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CHANGE IN PAN OF A FIRM IN CASE OF CHANGE IN PARTNERS

CA KRISHNA KUMAR DARUKA (CHARTERED ACCOUNTANT) (4458 Points)

30 March 2011

A firm had 4 partners. 2 partners retired. Firm is not a registered one.

1. Whether any change is required in PAN

2. Whether any other intimation is to be made to ITO in this regard.

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6 Replies

CA Saiyum khan (Practicing CA) (685 Points)
Replied 30 March 2011

Originally posted by : CA KRISHNA KUMAR DARUKA
	A firm had 4 partners. 2 partners retired. Firm is not a registered one. 1. Whether any change is required in PAN 2. Whether any other intimation is to be made to ITO in this regard.

In my view partnership firm is a different entity and it does not lose its identity merely on change of partners even though if it is not registered.

1. No chage is required in PAN.

2. No special intimation is required except that is prescribed in the format of ITR and Audit Report.

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CA. Dashrath Maheshwari (TaXpert) (15090 Points)
Replied 30 March 2011

FOr the purpose of income tax, registration of partnership is not compulsary and therefore, Firm is still firm when minimum 2 partners are there, but when only one partner is there, firm gets dissolved and need to surrender that PAN.

If that only partner wants to continue the business, he need to take separate PAN under his proprietorship.

RAVI YADAV (BHOPAL) (41 Points)
Replied 01 April 2011

Dear Sir,

When chagne of partners in firm not correction required in PAN Card, beacause when firm given application for New PAN card not provided detials about his partners to ITO only given ID & Address proof with fillup Form49 A(Partnersheep deed,Registration Certificate) of for PAN Card purpose.but change in address of firm should be fillup correction form(49a Correction)for Address

RAVI YADAV (BHOPAL) (41 Points)
Replied 01 April 2011

Dear Sir,

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 01 April 2011

Section 184. ASSESSMENT AS A FIRM.

(1) A firm shall be assessed as a firm for the purposes of this Act, if -

(i) The partnership is evidenced by an instrument; and

(ii) The individual shares of the partners are specified in that instrument.

(2) A certified copy of the instrument of partnership referred to in sub-section (1) shall accompany the return of income of the firm of the previous year relevant to the assessment year commencing on or after the 1st day of April, 1993, in respect of which assessment as a firm is first sought.

Explanation : For the purposes of this sub-section, the copy of the instrument of partnership shall be certified in writing by all the partners (not being minors) or, where the return is made after the dissolution of the firm, by all persons (not being minors) who were partners in the firm immediately before its dissolution and by the legal representative of any such partner who is deceased.

(3) Where a firm is assessed as such for any assessment year, it shall be assessed in the same capacity for every subsequent year if there is no change in the constitution of the firm or the shares of the partners as evidenced by the instrument of partnership on the basis of which the assessment as a firm was first sought.

(4) Where any such change had taken place in the previous year, the firm shall furnish a certified copy of the revised instrument of partnership along with the return of income for the assessment year relevant to such previous year and all the provisions of this section shall apply accordingly.

(5) Notwithstanding anything contained in the foregoing provisions of this section, where, in respect of any assessment year, there is on the part of a firm any such failure as is mentioned in section 144, the firm shall not be assessed as such for the said assessment year and, thereupon, the firm shall be assessed in the same manner as an association of persons, and all the provisions of this Act shall apply accordingly.

Suresh Krishnan (Manager) (26 Points)
Replied 30 October 2021

According to the structure of the PAN number, the 5th character is the first letter of the firm/individual. So when a name change in a partnership firm will lead to a change in PAN number.