Which of the following will lead to dissolution of partnership firm by agreement?
- AAdmission of a partner
- BWith the consent of all the partners.
- CDeath of a partner
- DExpiry of the period of partnership
Solution & Step-by-step Explanation
According to Section 40 of the Indian Partnership Act, 1932, a firm may be dissolved with the consent of all the partners or in accordance with a contract between the partners. This is known as dissolution by agreement. Other options like admission, death, or expiry of a term generally lead to the dissolution of partnership (reconstitution) rather than the compulsory or agreed dissolution of the entire firm itself unless specified.