My father was partner in a firm.total 3 partner. He was retired from the firm by other 2 with retirement deed but the deed is not submitted in the baklnk.so the account still remains with 3 partner names.he never got any profit 33% from the partnership.(10years). retired from the partnership in2019.what should we to get the money.and is it safe that in bank we are still partner.and the other partner brought another partner and made other account and doing business.
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In your case various options are available.
1. File a case of cheating and misappropriation against the partners in police.
2. File similar case in district court and challenge the retirement and formation of new partnership for the same business without the dissolution of the partnership.
3. You need to write to the bank to cease the account operation.
4. If the partnership firm is registered complain to the registrar as well.
Issue legal notice to firm and partners for recovery of your dues with interest
if they fail to pay file suit to recover dues with interest
also inform bank about retirement from firm . Enclose copy of deed of retirement
A case must be filed before the registrar for accounts and audit of the firm as your father was a partner in that firm.
You need to approach the registrar of firms and then to court for your capital
Retirement deed is actually signed by my father himself.(when he was suffering from dementia,also doesn't know about deeds and business)for the last 10years the capital is never increased and no profit shared in last 10years according to audit and itr fillings.retirement deed was made in 2019 but not submitted in bank for 2 years .so the bank is asking for a new retirement deed to close the accounts.for which we refused to sign the deed this time. So for this should we go for cheating and file a police complain and register a complain in registrar? Also is it necessary to send a legal notice to bank or we can send a registered post stating ceasation for the operation of accounts.
Sent letter to bank by registered post and also enclose retirement deed
2) issue legal notice to firm and partners for recovery of dues payable to father on retirement from firm
Yes first start with a legal notice and then proceed with the civil and criminal remedies
The amount due to the retiring partner is ascertained by preparing his capital account incorporating all the adjustments like the share of goodwill, undistributed profits or losses, accumulated reserves, profit or loss on revaluation of assets and liabilities etc.
The amount due to a retiring partner is settled as per the terms of partnership agreement or otherwise mutually agreed upon either in lump sum or in installments.
Section 37 deals with the rights of an outgoing partner in certain cases to share subsequent profits. It says that if any member of the firm dies or ceases to be the partner of the firm and the other partner carries on the business without any final settlement of the account between them; Then the outgoing partner is entitled to share his profits made by the firm, since he ceased to be a partner. The outgoing partner or his representative is entitled to use his share in the property of the firm or the interest at the rate of six percent per annum on the amount of the outgoing partner’s share in the property of the firm.
Therefore your father who retired from the partnership can take legal actions for recovery of his dues from the firm.
He can very well file a suit for rendition of accounts from the date of his retirement till the date preceding the institution of the suit and also for the appreciation of capital investment and profits therein.
You can consult a local lawyer and proceed as suggested.
The bank has nothing to do with this .
If the firm is submitting the retirement deed as on the date ou have mentioned, you may object to it.
However since your father is suffering from dementia, i.e., suffering from loss of cognitive functioning — thinking, remembering, and reasoning, you may have to make an arrangement to declare him mentally unfit and proceed with the after getting an authorisation from family members to pursue the matter on his behalf.
The police complaint may not come to your rescue for recovery of your dues from the firm.
A partner is entitled to share equally in the profits earned by firm in proportion to his contribution of capital in the firm. File a suit against the firm for rendition of accounts and payment of his share of profits earned by the firm during the period he was partner. Suit is to be filed in civil Court of the district where the office of firm is situated. It is not safe to let name of retired partner continue in the bank accounts. Such partner is accountable for any liability arising out of business of firm. Issue a public notice in local paper of retirement of partner to avoid any liability after retirement.
Dear Client,
As per the facts which have been provided, issue a legal notice to the firm and its partners.
Thank You.
