Question : Assertion (A): The partnership agreement can be written or oral.
Reason (R): To avoid any misunderstandings or disputes, it is always best to have a written agreement that has been signed and registered under the Act.
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: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
Solution : A written partnership agreement ensures that the partnership firm's business runs smoothly. It also aids in the resolution of disputes between partners. A duly signed and registered partnership deed can also be used as evidence in court.
Hence the correct answer is option 1.