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PARTNERSHIP DEED AMENDMENT (LAW)

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This query is : Resolved



( Author )
21 March 2010

Dear Friends,

I have an one query regarding Partnership Deed.

One of our client have Partnership business, they were 2 partners but 3 years back one of partner was dead, then they have introduced one new partner in the firm within 1 week of partner death, but at that time they did not amend the Partnership deed & same not registered with Registrar Of Firm.

Now they have 2 stamp papers of Rs.100 each dated April 2007 & they want to modified the deed & same they want to Registred with ROF.

Kindly guide me in the matter what to do & I want the same type of partnership deed related to the same case.

Best Regards

Devang Mirani

9819839798


M Prabhakar Menon

( Expert )
21 March 2010

Prepare a new partnership deed for incoming partner in the available stamp paper.Registration can be done at any time better that the new deed is silent on this issue since its 3 years old. Appearing as an after thought get the new deed registered by getting signatures of the new partners on the application for registration Registration is not compulsory however pl c S 69 for effect of non registration.


CA CHINTAN AJMERA

( Expert )
21 March 2010

Agree with expert


Devang Mirani

( Author )
21 March 2010

ya can u give me the similar Partnership deed bcoz i didnt get good exposure in the same.

I want to finalise the issue by today only so plz send me the similar partnership deed.


B.Chackrapani Warrier

( Expert )
21 March 2010

As per my understanding you cannot LEGALLY regularise the issue on account of the following observations.
1) In a partnership with two partners and out of that two one dies, the unavoidable inference is that the firm stands dissolved.

Citation :- CIT Vs Seth Govindram Sugar Mills (1965) 57 ITR 570(SC).

2) If some way or other you reconstitute the deed after the death of one partner,there is only one common partner which again leads to dissolution in the view that the partnership, at that point of time, was reduced to one ceasing to be a partnership.

Citation :- Palamkunnathu Traders Vs.CIT (2004) 269 ITR 322 (Ker).


Rahul Gupta

( Expert )
22 March 2010

Agreed with Mr. Warrier.

But the point arises that if we create the deed on the stamp paper of 2007 admitting new partner in partnership. Does it not leads to a Valid deed entered after the death of the one partner?

In my opinion, it will amount to a valid deed and the partnership can continue. Although consequences of not registering and intimating the change will follow. Also, in the original deed there may be some provisions for admitting a partner or dissolution of the firm at death of any partner.

Experts views are solicited.........


M Prabhakar Menon

( Expert )
23 March 2010

Mr Gupta is right.


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