Z and W are partners in a stationery business. Z uses the firm’s letterhead to order two bags of wheat…
Section 19(1) of the Indian Partnership Act, 1932, binds a firm when a partner acts in the usual way of carrying on that kind of business. Section 22 addresses how a partner…
Choose your answer
Z and W are partners in a stationery business. Z uses the firm’s letterhead to order two bags of wheat for personal use at home. The firm neither authorised nor later adopted the purchase. Under the Indian Partnership Act, 1932, is the firm liable to pay for the wheat?
Answer and explanation
Correct answer A
Section 19(1) of the Indian Partnership Act, 1932, binds a firm when a partner acts in the usual way of carrying on that kind of business.
Section 22 addresses how a partner acts so as to indicate an intention to bind the firm. Firm letterhead does not make the personal purchase part of a stationery business.
Option feedback
Option A
A personal wheat purchase falls outside the usual business of a stationery firm. The facts supply no other basis for binding the firm.
Option B
Partner status alone does not bind the firm for a personal transaction outside the scope of the partner’s authority.
Option C
The presence of two partners does not turn an unauthorised personal purchase into a debt for half the price.
Option D
Using the firm’s letterhead may indicate an intention to bind the firm, but it does not supply authority that the partner otherwise lacks.
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