Partnership Deed Format for IT, Software & Computer Business in India

DEED OF PARTNERSHIP

This Deed of Partnership is made at on this day of , 20, by and between:

1. Mr./Ms. , son/daughter/spouse of , residing at , hereinafter referred to as the "First Partner";

AND

2. Mr./Ms. , son/daughter/spouse of , residing at , hereinafter referred to as the "Second Partner".

The First Partner and Second Partner are collectively referred to as the "Partners". The Partners agree to carry on business in partnership upon the following terms and conditions.

1. Name of the firm. The partnership business shall be carried on under the name and style of M/s , or under such other lawful name as may be unanimously agreed in writing by the Partners.

2. Commencement and duration. The partnership shall commence with effect from . Unless a fixed term is expressly inserted here-the partnership shall be treated in accordance with the Indian Partnership Act, 1932 and the terms of this deed.

3. Principal place of business. The principal place of business shall be at . The Partners may open, shift or close branches, offices, development centres, warehouses or other places of business by mutual written consent and subject to applicable law.

4. Objects and nature of business. The firm may carry on lawful activities relating to information technology and allied services, including software and application development, website design and development, cloud and IT-enabled services, software licensing and support, digital marketing and online advertising services, purchase and sale of computers, peripherals, networking equipment and other electronic products, installation and annual maintenance services, consultancy, training, outsourcing and such other allied activities as the Partners may unanimously approve.

5. Capital. The initial capital of the firm shall be ₹, contributed as follows:

(a) First Partner: ₹ / %

(b) Second Partner: ₹ / %

Further capital, if required, may be introduced in such proportions and on such terms as the Partners agree in writing. Amounts introduced as loans shall be separately recorded in the books.

6. Interest on capital and partner loans. Interest, if any, on capital or loans standing to the credit of a Partner shall be payable at the rate mutually agreed by the Partners, subject always to the maximum deduction, conditions and restrictions permitted under section 40(b) of the Income-tax Act, 1961, as amended from time to time.

7. Profit and loss sharing. The net profits and losses of the firm, after providing for all lawful business expenses, depreciation, interest, remuneration, taxes and other proper charges, shall be divided and borne by the Partners in the following ratio:

(a) First Partner: %

(b) Second Partner: %

8. Working partners and remuneration. The Partners who actively engage in conducting the affairs of the firm shall be treated as working partners. The working partners may be paid salary, bonus, commission or other remuneration as mutually determined and recorded in the books, provided that the aggregate amount deductible by the firm shall not exceed the amount allowable under section 40(b) of the Income-tax Act, 1961, as amended from time to time. The firm shall comply with tax-deduction obligations, including section 194T where applicable.

9. Bank accounts and digital payment facilities. The firm may maintain accounts with any scheduled bank or other legally permitted financial institution. Accounts, internet-banking facilities, payment gateways and authorised payment instruments shall be operated by such Partner or Partners and subject to such limits as may be decided in writing.

10. Books, records and financial year. Proper books of account, statutory records, tax records, invoices, contracts and supporting documents shall be maintained at the principal place of business or electronically in a lawful manner. The accounting year shall ordinarily run from 1 April to 31 March. Each Partner shall have reasonable access to the firm's books and records.

11. Duties of Partners. Each Partner shall act honestly and in the interest of the firm, give true accounts and full information relating to the firm's affairs, attend diligently to the business undertaken by that Partner, protect the firm's property and reputation, and comply with applicable law and agreed internal controls.

12. Restrictions without consent. Unless the other Partner gives prior written consent, no Partner shall outside the ordinary course of the firm's business:

(a) borrow material sums or create a charge over firm assets;

(b) give guarantees or securities on behalf of the firm;

(c) assign or encumber that Partner's interest in the firm;

(d) compromise or release a material debt due to the firm;

(e) enter into a material related-party transaction;

(f) admit liability or settle material litigation on behalf of the firm; or

(g) use firm funds or confidential information for an unauthorised personal purpose.

13. Intellectual property and work product. Unless otherwise agreed in writing for a particular project, intellectual property, source code, designs, databases, documentation, domain names, trademarks, business names and other work product created, acquired or paid for by the firm for its business shall belong to the firm, subject to third-party licence terms and applicable law. Each Partner shall execute documents reasonably required to record or protect the firm's rights.

14. Confidentiality and data. Each Partner shall keep confidential the firm's source code, credentials, customer information, pricing, trade secrets, commercial records and other non-public information. Personal data and customer data shall be accessed, used, stored and disclosed only for legitimate business purposes and in accordance with applicable law and contractual obligations.

15. Contracts, employees and professionals. The firm may engage employees, consultants, contractors, accountants, advocates and other professionals as necessary. Material appointments and contracts shall be approved in the manner mutually fixed by the Partners.

16. Drawings. Each Partner may draw sums against expected profit or remuneration within limits mutually agreed from time to time. Excess drawings shall be adjusted in the Partner's account.

17. Admission of a new partner. No person shall be admitted as a Partner without the consent of all existing Partners and execution of an appropriate supplementary or reconstituted deed specifying capital, profit-sharing and other agreed terms.

18. Retirement. A Partner may retire in accordance with this deed and the Indian Partnership Act, 1932 by giving days' written notice, unless the other Partners waive or modify the notice period in writing. Accounts shall be settled up to the effective date of retirement, subject to liabilities and agreed valuation terms.

19. Death, incapacity or insolvency. The consequences of death, permanent incapacity or insolvency of a Partner shall be governed by the Indian Partnership Act, 1932 and this deed. Subject to law and mutual agreement with persons legally entitled to the outgoing Partner's interest, the continuing Partner or Partners may continue the business and settle the outgoing interest on a valuation basis recorded in writing.

20. Valuation of outgoing interest. Unless otherwise agreed, the amount payable on retirement, death or other cessation shall be determined from properly prepared accounts as of the relevant date after considering capital, current account balances, accrued profits or losses, outstanding liabilities, recoverability of receivables, work in progress and the value of goodwill and other assets where applicable.

21. Goodwill and business name. Goodwill, domain names, trademarks, social-media identifiers, customer relationships and other business identifiers acquired for the firm shall form part of the firm's assets. Their use following reconstitution or dissolution shall be settled in writing and in accordance with applicable law.

22. Statutory registrations and compliance. The firm and Partners shall obtain and maintain registrations, licences and tax accounts required for the activities actually carried on, including PAN, GST registration where applicable, and other sectoral or local registrations. If eligible and desired, the firm may obtain Udyam Registration through the official Ministry of MSME portal.

23. Accounts on dissolution. On dissolution, the firm's accounts shall be taken and its assets applied toward debts and liabilities, partner advances, capital and the residue in accordance with the Indian Partnership Act, 1932 and the agreed profit-sharing ratio, subject to any lawful written settlement among the Partners.

24. Dispute resolution. The Partners shall first attempt in good faith to resolve disputes by discussion. Any dispute arising out of or relating to this deed that remains unresolved may be referred to arbitration under the Arbitration and Conciliation Act, 1996, as amended from time to time. The seat and venue of arbitration shall be , India. The arbitration shall be conducted by a sole arbitrator mutually appointed by the Partners; if appointment cannot be agreed, the appointment shall be made in accordance with applicable law. The language of arbitration shall be English, unless otherwise agreed.

25. Notices. Notices under this deed shall be in writing and delivered personally, by registered/speed post, recognised courier or electronic means capable of generating reliable delivery records to the latest address or electronic address notified by a Partner.

26. Amendments. Any material amendment to this deed shall be made in writing and signed by all Partners, with appropriate stamping, registration or filing wherever required.

27. Governing law. This deed and the partnership shall be governed by the laws of India, including the Indian Partnership Act, 1932, and other laws applicable to the firm's activities.

IN WITNESS WHEREOF, the Partners have signed this Deed of Partnership on the date and place first written above.

Witnesses