On the basis of liability, partnerships may be divided into two classes.

1. General Partnership or Unlimited partnership: A partnership which has only general partners is called “General partnership”. The partners whose liability is unlimited are called “General partners.”

2. Limited partnership: In a general partnership, the liability of every partner unlimited. This has proved to be a serious drawback from the growth of partnership organization. In order to remove the drawback of “unlimited liability”. Limited partnership has been introduced in Western European countries and in U.S. A. This type of partnership is governed by a separate act called the Limited partnership Act. This type of partnership is not permitted by law in India.

A partnership which has one or more limited partners in addition to one or more general partners in called ‘Limited Partnership”. The partners whose liability is limited to the extent of capital contributed by them are called “limited partner” or “special partners”.

From tlte point of view of duration, partnerships may be classified into three kinds they are:

1. Partnership for a fixed term 

2. Particular partnership 

3. Partnership at will.

i. Partnership for a fixed term: When a partnership is formed for a fixed term (i.e., for a particular period), it is called partnership for a fixed term. A partnership for a fixed term comes to an end on the expiry of the fixed period. It may be noted that a partnership formed for a fixed period may be continued even after the expiry of the fixed period, if the partners decide to continue their partnership after the expiry of the period, the rights and obligations of the partners will remain the same as before, and the partnership will become partnership at

ii. Particular partnership: When a partnership is formed for a particular venture (i.e., undertaking or business), it is called particular partnership. A partnership formed for a specified or particular venture comes to an end on the completion of the specified venture. As in the case of a partnership formed for a fixed term, a particular partnership also can be continued even after the completion of the particular venture, if the partners decide to continue their t partnership after the completion of the particular venture.

iii. Partnership at will: Where no provision is made in the contract between ‘ the partners for the duration of their partnership or- for the termination of their partnership, the partnership is called “partnership at will”, f As the duration is not fixed in the case of partnership at will, the partnership at will is uncertain and indefinite. Such a partnership can be dissolved at any time at the will and pleasure of any partner