Section 4 of the Indian Partnership Act 1932 defines partnership.
According to Section 4, partnership is defined as "the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all."
This definition highlights three essential elements of a partnership:
- There must be an agreement between persons
- The agreement must be to share profits of a business
- The business must be carried on by all partners or any of them acting for all
Section 4 is the foundational provision that establishes what constitutes a partnership under Indian law. All other provisions of the Act are based on this primary definition.