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mediumMCQCUET 2025 31 May Shift 12026CUET Accountancy
1 mark

The Court may order a partnership firm to be dissolved in which of the following case?

  1. A
    When the business of the firm becomes illegal
  2. B
    On the death of a partner
  3. C
    When a partner becomes insane
  4. D
    On the expiry of the term of the partnership

Solution & Step-by-step Explanation

Let's distinguish between different statutory causes of dissolution:Compulsory Dissolution (Section 41): Occurs automatically when the business becomes illegal.Contingent Dissolution (Section 42): Occurs naturally upon death of a partner or completion of a defined term, unless contracted otherwise.Dissolution by Court (Section 44): The court steps in to pass a legal order for dissolution upon suit filed by a partner if a partner becomes of unsound mind (insane), permanently incapacitated, or guilty of misconduct.

Practice this question

Try it yourself before checking the explanation above.

The Court may order a partnership firm to be dissolved in which of the following case?
A
When the business of the firm becomes illegal
B
On the death of a partner
C
When a partner becomes insane
D
On the expiry of the term of the partnership

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