Hell sir,
Can HUF become partner in partnership firm with the same rights and responsibilities as a individual become partner?
3 Replies
jashwanth
(CA-PRACTICE)
(400 Points)
Replied 17 May 2020
HUF can't become a partner in a partnership firm. As individuals only can enter into the partnership.
madhur
(student)
(25 Points)
Replied 19 May 2020
The Hon’ble Supreme Court in Ram Laxman Sugar Mills vs. CIT [1967] 66 ITR 613 observed that a HUF is undoubtedly a Person with in the meaning of section 2(31), it is however not a juristic person for all purposes and cannot enter in to an agreement of partnership either with another HUF or Individual.
CA Raj Doshi
(Practising CA)
(8944 Points)
Replied 27 May 2020
An HUF can become a partner in a firm through its Karta. Salary to HUF as a partner shall be taxable in the hands of Karta. Interest on capital shall be taxable in the hands of HUF.
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