Section 27 of the Indian Partnership Act, 1932 deals with:

Section 27 makes the firm liable where a partner, acting within his apparent authority, receives and misapplies money or property of a third party, or where the firm receives it in the course of business and a partner misapplies it while it is in the firm's custody. Wrongful acts of a partner generally are covered by s.26, a partner's liability for acts of the firm by s.25 and a transferee's rights by s.29.