Partner Ship firm

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 February 2011 A partnership firm having two partners. The net profit of the firm in crores. Now the existing partner's want to introduce two new partner without any capital or a minimum capital say rs. 50000/- from each. At the end of the year the nete profit will be distributed to all the four partner's. There is no extra expenses bookedby the firm due to indroduction of partner's. Hence firm will pay taxes as usual as it will pay without introduction of new parners. But funds are diverted in four partner's and the profit will be exempt in the hands of the partner. Now my basic issue is that a huge capital account will be created of new partners without any major capital and without paying any tax. is it practicable or any section of any law will attract it as diversion of funds.

Guest

Guest (Expert)

10 February 2011 Nothing wrong if it is genuine firm.

Message likes : 1 times

Querist : Anonymous

Querist : Anonymous (Querist)

11 February 2011 yes it is a genuine firm operating bussiness from last 3 - 4 years.but my basic question is that it is a diversion of funds. is it not the violation of law either of Income tax or partnership act.

Guest

Guest (Expert)

14 February 2011 There should be no problem.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

R M Shekhaliya

Amit Goyal

SHRI HARIRAO

Frank

Pushkar Nagda

Subscribe Now

Partner Ship firm

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Accountant

GST CONSULTANT

CA Final

Manager- Finance and Compliance

GST CONSULTANCY