Search Blog

Saturday, April 13

Partner to indemnify the firm for any loss caused to it by his fraud


As per section 10 of Indian Partnership Act, 1932, every partner of the firm is liable to indemnify the firm for any loss caused to it by his fraud in the conduct of the business of the firm.
To attract the provision of section 10, followings are necessary:
(i)    A loss to the Firm,
(ii)   The loss has to be caused due to partner’s fraud, and
(iii)  Fraud has to be in relation to the conduct of the business of the Firm.

The term ‘fraud’ has the same meaning as given in section 17 of the Indian Contract Act, 1872