Dear Friends
There is one Partnership firm with A,B,C,D as 25 % partners. Also there is one Private ltd. company with same persons with same shareholding pattern.
Now there is no money in Partnership firm but money is lying idle in Pvt. Ltd. Co. I understand that if money is transferred from pvt. ltd. co. to partnerhip firm it will be treated as deemed dividend.
To over come that it is proposed that the above pvt. ltd company be made partner in the partnership firm upto say 20 % and existing partners reduce their share and this company brings in capital contribution and money comes into the firm. IS this transaction be treated as Tax planning or it is not within the frame work of the law
Please reply
CA Rajesh Poddar
CAclubindia
