Question

Ritesh and Hitesh are childhood friends. Ritesh is a consultant whereas Hitesh is an architect. They contributed equal amounts and purchased a building for Rs 2 crores. After a year, they sold it for Rs 3 crores and shared the profits equally. Are they doing the business in partnership? Give reason in support of your answer.

Answer 1

No, the relationship between Ritesh and Hitesh cannot be called as Partnership but would be they regarded as the co-owners. This is because Partnership requires the partners to conduct the business on a regular basis and share the profits from the same whereas in this case, this is a one-time activity.