Reconstruction of Partnership farm.
This query is : Resolved
27 February 2008
What is the tax treatment when one partner givesome amount to another partner to buy his share in profit.For example . A and B was partner with equal ratio with capital investment of 100m each.A buy B 40% stake by giving him 150m.Mean B invest 80m for 40% stake(100m for 50% share) now he got 150M .B got 70m extra. so what is the tax treatment for that
S.Srinivasaraghavan
(Expert)
27 February 2008
This will be construed as reliqishment of his right in the share of the firm. But there are litigation decided in various manner whether it is transfer or not.
27 February 2008
thanks . but how this 70m is charegable . either by CG or in BP
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