A, B and C are partners in a firm. As per terms of the partnership deed, A is entitled to 20 percent of the partnership property and profits. A retires from the firm and dies after 15 days. B and C continue business of the firm without settling accounts. What are the rights of A’s legal representatives against the firm under the Indian Partnership Act, 1932?

Retirement / Death of Partner: Section 37 of the Indian Partnership Act, 1932 provides that where a partner dies or otherwise ceases to be a partner and there is no final settlement of account between the legal representatives of the deceased partner or the firms with the property of the firm, then, in the absence of a contract to the contrary, the legal representatives of the deceased partner or the retired partner are entitled to claim either. \n(i) Such shares of the profits earned after the death or retirement of the partner which is attributable to the use of his share in the property of the firm; or\n(ii) Interest at the rate of 6 per cent annum on the amount of his share in the property. \nBased on the aforesaid provisions of Section 37 of the Indian Partnership Act, 1932, in the given problem, A shall be entitled, at his option to: \n(i) the 20% shares of profits (as per the partnership deed); or \n(ii) interest at the rate of 6 per cent per annum on the amount of A’s share in the property.