Daily law MCQ Today
Zoya is a partner who habitually acts in the business of her firm. Aadil, a supplier, is…
Indian Partnership Act, 1932 Medium
Zoya is a partner who habitually acts in the business of her firm. Aadil, a supplier, is working together with Zoya to cheat the firm. He gives Zoya notice of a defect in goods he supplied to the firm, and she hides it from the other partners. Does the notice to Zoya operate as notice to the firm under Section 24?
Show answer and explanation
Answer: C. No, because the rule does not apply in the case of a fraud on the firm committed by or with the consent of that partner
Explanation
Under Section 24, notice to a partner who habitually acts in the business of the firm, of any matter relating to the firm's affairs, operates as notice to the firm. The section expressly excludes a fraud on the firm committed by or with the consent of that partner. Since Zoya was working with Aadil to cheat the firm, the general rule stated in the first option does not apply.
- Legal provision:
- Section 24, Indian Partnership Act, 1932