Q: What do we mean by Dissolution of partnership without intervention of Court

Ans: Dissolution of partnership firm without the intervention of Court:-

1. By Agreement (S.40)
Section 40 of partnership act mentions that a partnership firm can be dissolved any time with the consent of all the partners whether the partnership is at will or for a fixed duration. A partnership can be dissolved in conformity with the terms of the Partnership Deed or of the terms of separate agreement.

2. Compulsory Dissolution (Sec.41):- In case of compulsory dissolution, any of the following events take place then it becomes compulsory for the firm to dissolute:

(i) Insolvency of Partners: 

In case all the partners or all the partners except one become insolvent because there must be atleast two persons for partnership. 

(ii) Unlawful Business

If the firm is engaged in more than one business which may have become unlawful, the unlawful business will be dissolved.  E.g. A and B charter a ship to go to foreign port and receive a cargo on the joint venture. War happens between England and the country where the port is situated before the ship arrives at the port, and it continues until after the time appointed for loading. The partnership between A and B is dissolved. 

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