Question : Assertion (A): A partnership firm does not exist as a separate legal entity apart from the partners who comprise it.
Reason (R): The Central Government has established a limit of 100 partners in a firm.
Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
Option 3: Assertion (A) is true but Reason (R) is False
Option 4: Both Assertion (A) and Reason (R) are not correct
Correct Answer: Assertion (A) is true but Reason (R) is False
Solution : The Partnership Firm is not legally distinct from the partners. If any of your partners commits fraud. The partners, not the firm, would face legal action. The assertion is correct. The central government has set a limit of 50 partners.
Hence the correct answer is option 3.
