A partnership firm consists of three partners 'A', 'B' & 'C', and owes 'R' sum of Rs. 15,000. 'A' wants to retire and it is agreed amongst all the three partners and 'R' that after retirement of 'A', 'B' & 'C' as continuing partners shall be liable for the dues of 'R'. After the retirement of 'A', 'R' sues 'A' for recovery of Rs. 15,000.

A) R' has an option to sue the firm consisting of 'B' & 'C' or the retired partner 'A' B) R' has a right to sue 'A' to the extent of Rs. 5000 being the portion attributable to 'A' C) R' has no right to sue 'A' as after the retirement of 'A' a new agreement came into being between 'R' & the firm and 'A' stood discharged of his liability towards 'R' D) 'R' can sue the firm consisting of 'B' & 'C' alongwith 'A' as liability of all the partners is joint & several

Answer & Solution

Correct Answer: Option C

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