11. Prohibition of
associations and partnerships exceeding certain number.—(l)
No company, association or partnership consisting of more
than ten persons shall be formed for the purpose of carrying
on the business of banking, unless it is registered as a company
under this Act, or formed in pursuance of some other Indian
Law.
(2) No company, association or partnership consisting of
more than twenty persons shall be formed for the purpose of
carrying on any other business that has for its object the
acquisition of gain by the company, association or partnership
or by the individual members thereof, unless it is registered
as a company under this Act, or is formed in pursuance of
some other Indian law.
(3) This section shall not apply to a joint family as such
carrying on a business; and where a business is carried on
by two or more joint families, in computing the number of
persons for the purposes of sub-sections (1) and (2), minor
members of such families shall be excluded.
(4) Every member of a company, association or partnership
carrying on business in contravention of this section shall
be personally liable for all liabilities incurred in such
business.
(5) Every person who is a member of a company, association
or partnership formed in contravention of this section shall
be punishable with fine which may extend to 1[ten thousand
rupees.
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