Home › CA Foundation › businesslaw › Partnership — General Nature of Partnership › A 'nominal partner' is one who:
A 'nominal partner' is one who:
AShares profits but not losses
BLends his name to the firm without real interest, takes no share of profits, yet is liable to third parties
CIs admitted only to the benefits of partnership
DInvests capital but takes no profit
Answer & Solution
Correct answer: B. Lends his name to the firm without real interest, takes no share of profits, yet is liable to third parties
A nominal partner only lends his name; he neither contributes capital nor shares profits, but he is liable to third parties for the firm's acts.
Related questions
Unlike a company which enjoys perpetual succession, in a partnership the death or insolvenIn determining the existence of a partnership under Section 6, the sharing of profits is:The name under which the business of a partnership is carried on is called the:Which correctly distinguishes partnership from co-ownership?A 'sub-partner' (a person with whom a partner shares his own share of profits):Under Section 28, a person who by words or conduct represents himself, or knowingly permitAn outgoing (retiring) partner remains liable to third parties for the firm's acts:An incoming partner admitted into an existing firm is: