Change in Partnership Deed: Add a Partner, Retire, or Revise Terms
A change in partnership deed records any change in who the partners are or how the firm runs: a new partner, a retirement, a new profit ratio or a new address. We draft the supplementary deed, get it stamped, and record the change with the Registrar of Firms, GST and your bank.
What it is
A partnership deed is the agreement between the partners of a firm. When the partners agree to change it, they sign a supplementary deed (also called a deed of amendment, admission or retirement). The old deed stays; the new one changes only the clauses it names.
If your firm is registered, the Indian Partnership Act, 1932 lets you record the change with the Registrar of Firms: Section 60 for a new firm name or principal place of business, Section 61 for branches, Section 62 for a partner’s name or address, and Section 63 for a partner joining or leaving. Registering a new firm is a separate job, covered on our partnership firm registration page.
Who it applies to
Partners joining or leaving
Admission of a new partner, retirement, expulsion as the deed allows, or the death of a partner where the firm carries on.
Changes in terms
A new profit-sharing ratio, new capital contributions, or revised interest and remuneration for working partners.
Changes in the business
A new firm name or principal place of business, a branch opened or closed, or a new line of business.
Why it matters
Keep your right to sue
Section 69 bars a suit on a contract unless the firm is registered and the persons suing are shown in the register as partners. Here is the catch: a new partner who is not on the register may be unable to sue on the firm’s contracts.
Shield the retiring partner
Under Section 32(3), a retiring partner stays liable to third parties for the firm’s acts until public notice of the retirement is given.
Protect your tax deductions
Interest and remuneration to partners are deductible only within the limits of the income-tax law and only if the deed authorises them. A new ratio or salary needs a new clause.
Documents required
Firm documents
- Original partnership deed and any earlier amendments
- Registration certificate from the Registrar of Firms, if registered
- Firm PAN and GST certificate
Partner documents
- PAN, Aadhaar and address proof of the incoming partner
- Retirement letter or notice from the outgoing partner
- Death certificate and legal heir details, where relevant
For the new deed
- Agreed changes: ratio, capital, salaries, address
- E-stamp paper
- Two witnesses for signing
Which section for which change
| Change | Section of the 1932 Act | Who may notify the Registrar |
|---|---|---|
| Firm name or principal place of business | Section 60 | All partners, by a signed and verified statement |
| Branch opened or closed | Section 61 | Any partner or agent of the firm |
| Partner’s name or permanent address | Section 62 | Any partner or agent of the firm |
| Partner joins or leaves; firm dissolved | Section 63(1) | Any incoming, continuing or outgoing partner |
| Minor admitted to benefits comes of age | Section 63(2) | The person concerned |
An unregistered firm just executes the supplementary deed; GST, the bank and tax records still need updating.
How it works
Read the existing deed
We check the admission, retirement, expulsion and death clauses, and whose consent is needed. Take a Faridabad trading firm where the father is retiring and his son is joining: both events go into one supplementary deed with the same effective date.
Draft only the clauses that change
We write the amended clauses with a clear effective date, the new ratio and capital, and the settlement with any outgoing partner.
Stamp, sign and notarise
The deed goes on e-stamp paper, is signed by all partners and two witnesses, and is notarised where needed.
Record it with the Registrar of Firms
For a registered firm in Haryana, the change is filed on the Industries and Commerce Department’s online firm registration portal. In practice, a shop moving its principal place from NIT to Sector 24 needs a Section 60 statement and a GST core-field amendment at the same time.
Update GST, bank and tax records
We file the GST registration amendment, give the bank the new deed, and use the revised terms in the firm’s books and income-tax return.
Timelines
GST: 15 days
Partners, legal name and principal place are core fields. File FORM GST REG-14 within 15 days.
Registrar of Firms
The 1932 Act sets no day limit for Section 63 notices, but until you file, the register shows the old partners.
Stamping
The deed must be stamped before or at the time it is signed, under Section 17 of the Indian Stamp Act, 1899.
What happens if you don’t record the change
Weak position in court
A partner not shown in the register may be unable to sue on the firm’s contracts under Section 69.
Unstamped deed
Under Section 35 of the Stamp Act, an unstamped deed is not admissible in evidence until duty and a penalty of up to ten times the deficit are paid.
Disallowed deductions
Salary or interest paid to a partner without authority in the deed can be disallowed in the firm’s assessment.
Frequently asked questions
Is it compulsory to register a change in partnership deed?
Not in so many words: Section 63 of the Indian Partnership Act says partners “may” give notice. For a registered firm you should still record it. Without it, the register still shows the old partners, and Section 69 can block a suit by a partner not shown there. An unregistered firm files nothing with the Registrar but must still stamp the deed.
What stamp duty applies in Haryana?
It depends on what the deed does. A supplementary deed is stamped under the Haryana Schedule article that matches its effect, such as admission of a partner or retirement, and the duty is paid by e-stamp through the e-GRAS portal. The deed must be stamped before or when it is signed. We confirm the article and the current duty for your deed before you buy e-stamp paper, so nothing is paid twice.
Does the firm need a new PAN when a partner changes?
No. The firm’s PAN continues as long as the firm itself continues with the remaining and new partners. The same applies to the GSTIN, which is linked to the PAN. If all old partners leave and the business is really a new firm, the position is different, and we check that before filing anything.
How do I update GST after changing the deed?
File an amendment in FORM GST REG-14 on the GST portal within 15 days of the change. Adding or removing a partner is a core-field change, so the GST officer must approve it. Upload the supplementary deed and the new partner’s details. Approval usually comes within 15 working days, and the GSTIN stays the same throughout.
Can a partner retire without the consent of the others?
Only if the deed or the type of partnership allows it. Under Section 32(1) of the 1932 Act, a partner may retire with the consent of all the other partners, as the partners expressly agree, or, in a partnership at will, by written notice to all the other partners. Most deeds include a retirement clause, and we draft the supplementary deed to follow it exactly.
Is public notice needed when a partner retires?
Yes, if the retiring partner wants to end liability to third parties. Section 32(3) keeps a retiring partner liable for the firm’s acts until public notice is given. For a registered firm, Section 72 requires notice to the Registrar and publication in the Official Gazette and at least one vernacular newspaper. We arrange both along with the deed.
How many partners can a firm have after the change?
At least two and at most 50. The upper limit comes from Section 464 of the Companies Act, 2013 read with Rule 10 of the Companies (Miscellaneous) Rules, 2014. If a retirement leaves only one partner, the firm cannot continue as a partnership. We can then help you admit a new partner, or move the business to a proprietorship or company.
Should we convert to an LLP or company instead?
Consider it if partners change often. In an LLP or company, a change of member is a routine ROC filing rather than a new deed each time, and liability is limited. Conversion carries its own costs and tax conditions, so we compare the options for your firm. Say a three-partner firm expects a fourth partner and an outside investor next year; a conversion to a private limited company may then save repeated deed changes.
What it costs
Our fee plus the government fee that applies to your case, quoted before you commit. Tell us the situation and we will price it exactly.
Government costs: stamp duty on the deed at your state’s rate (we confirm the current Haryana figure for your deed), any Registrar of Firms fee, and notary charges where needed. There is no fee for the GST amendment.
Ready to begin?
Send us your current deed and tell us what is changing; we will send back a draft supplementary deed.