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Sale of share in firm by a partner

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Querist : Anonymous

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Querist : Anonymous (Querist)
30 October 2011 Mr. A and Mr. B are partners in M/s AB & Co.

Mr. A sold his share to Mr. C for Rs. 10 lacs on 31-03-2011. The partners capital as per audited balance sheet as on 31-03-2011 was Rs. 5 lacs and Rs.4 lacs of both the partners.

Would there be any income tax liability to Mr. A towards profit on sale of his share?
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Gursimar Singh

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Gursimar Singh (Expert)
31 October 2011 No tax liability on Mr. A....it will be regarded as capital Recipt...(Based on a case law...)
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Querist : Anonymous

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Querist : Anonymous (Querist)
31 October 2011 kindly provide the case law on this.
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
09 July 2023 "Sorry, I am not a featured member."

For featured members contact....

https://www.caclubindia.com/catalogue/featured.asp
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