Partnership firms in India are governed by the Partnership Act, 1932. Section 4 of the Act defines Partnership as – “An agreement between persons who have agreed to share profits of the business carried on by all or any one of them acting for all.”

Registering a firm under the Partnership Act (hereinafter called the Act) is not mandatory as in the case of setting up a company. That said it is always advisable to get your firm registered at Registrar of Firms/Departments.