Sections 42 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 42 says a firm is dissolved, subject to contract between the partners, on four events: expiry of a fixed term, completion of its adventures, death of a partner, or insolvency of a partner. Section 43 lets any partner dissolve a partnership at will by written notice to all the others. For help choosing the route, see our legal consultation service.
Subject to contract between the partners, a firm is dissolved (a) by expiry of a fixed term, (b) by completion of the adventures or undertakings it was formed for, (c) by the death of a partner, (d) by the adjudication of a partner as an insolvent (s.42). Where the partnership is at will, any partner can dissolve the firm by giving notice in writing to all the other partners (43(1)). The firm is dissolved from the date stated in the notice, or, if none is stated, from the date the notice is communicated (43(2)).
Section 42: the four contingencies
| Clause | Event | Applies to |
|---|---|---|
| 42(a) | Expiry of the term | A firm constituted for a fixed term |
| 42(b) | Completion of the adventure(s) or undertaking(s) | A firm constituted to carry out one or more adventures or undertakings |
| 42(c) | Death of a partner | Any firm |
| 42(d) | Adjudication of a partner as an insolvent | Any firm |
The whole section begins "Subject to contract between the partners". That is the key point: the deed can displace each of the four. Many deeds say that the firm will continue despite the death of a partner, or a partner's insolvency. Where that is done, sections 34 and 35 supply the rules on liability afterwards; see sections 33 and 34 and sections 35 and 36.
42(a): expiry of a fixed term
If the firm was formed for a fixed term, say five years, it is dissolved when the term expires. What happens if the partners simply carry on after the term is dealt with in section 17, which is covered in sections 16 and 17. Section 42 does not discuss it.
42(b): completion of the adventure
A firm formed for a particular venture, such as constructing one building, is dissolved by completion of that venture. For the idea of a particular partnership, see sections 7 and 8.
42(c) and (d): death and insolvency
Death or adjudication of a partner dissolves the firm, unless the contract says otherwise. Compare section 41(a), under which the adjudication of all, or all but one, partners dissolves the firm without regard to contract; see sections 39 to 41.
Example. A three-partner firm has no clause on death. One partner, Sunil, dies. Under 42(c), the firm is dissolved. Had the deed said "the firm shall not be dissolved by the death of a partner and shall continue between the survivors", the contract would prevail and section 35 would limit the estate's liability for later acts.
The source copy has "Short Note" paragraphs under section 42 with case citations. They are the compiler's notes, not the Act, and are not relied upon.
Section 43: dissolution of a partnership at will
43(1): notice in writing to all
Where the partnership is at will, the firm may be dissolved by any partner giving notice in writing to all the other partners of his intention to dissolve the firm.
Three requirements appear in the text:
- the partnership must be at will;
- the notice must be in writing;
- it must go to all the other partners.
The text does not specify a minimum period of notice and does not say how the notice is to be delivered. Partnership at will means one with no fixed term and no provision for determination, as explained in partnership at will vs fixed term. This is why a short dissolution clause or a notice period in the deed is useful.
43(2): the date of dissolution
The firm is dissolved as from the date mentioned in the notice as the date of dissolution, or, if no date is mentioned, as from the date of the communication of the notice.
Example. Priya, a partner in a firm at will, writes to all her partners on 1 June saying "I wish to dissolve the firm with effect from 30 September". The firm is dissolved from 30 September. If her letter had named no date, it would be dissolved from the date the notice was communicated, that is, the day the others received it.
A "Short Note" under section 43 also appears in the copy; it is the compiler's note and not part of the Act.
What section 43 does not say
- It does not apply where the partnership is not at will.
- It does not require the other partners' consent.
- It does not say whether the date in the notice may be a past date. The text is silent.
- The deed may provide how notice is given and for how long, since section 43 itself does not say it is "subject to contract". Take advice before assuming the deed can override it either way.
After dissolution
Dissolution does not close the books at once. Partners remain liable to outsiders until public notice is given (see section 45), and accounts have to be settled (see partnership dissolution: five ways and the order of settling accounts).
Need help with dissolving a firm by notice?
Choosing the right route and wording the notice correctly makes the difference between a clean exit and a dispute about dates. Our legal consultation service can review your deed, say whether the firm is at will or for a term, and help you prepare a notice that meets section 43. We can also help with the winding-up that follows.
Key takeaways
- Subject to contract, a firm is dissolved by expiry of its term, completion of its adventures, death of a partner, or adjudication of a partner as insolvent (s.42).
- A partnership at will may be dissolved by any partner giving written notice to all the other partners (43(1)).
- Dissolution takes effect from the date stated in the notice, or, if none, from the date the notice is communicated (43(2)).
- The Act sets no minimum notice period in section 43.
Read next
- Sections 39 to 41: dissolution by agreement and compulsory dissolution
- Section 44: dissolution by the Court
- Sections 7 and 8: partnership at will and particular partnership
- Partnership at will vs partnership for a fixed term
Disclaimer: Based on the text of the Indian Partnership Act, 1932 as consulted on 1 October 2026. Several States have amended the registration chapter and make their own rules, forms and fees for the Registrar of Firms. This article is general information, not legal advice; check the official text and your State's rules before acting.