LIVE GST Audit Course by CA Sachin Jain. Register Now!!

Issues on death of a partner, in partnership

shikhar (LEARNER ) (1394 Points)

12 January 2013

IF there r 3 partners in a partnership firm and, one partner died in the mid of the year (30.09.2012), on 1st jan2013 one partner also join the firm . i am searching answers for following questions.

(1) wht changes should be maid in partnership dead, weather i hv to go with new partnership dead or supplimentary dead is sufficient??

(2) should i continue the firm with similar PAN?? or i hv to apply new ???

(3) if i use similar pan then weather i hv to intimate to PAN authority regarding change in partnership dead???

(4)whts should be the impact on income tax return filling for the above.

Waiting for your valuable replies.

Reply
Follow
Share

3 Replies

Nikhil Kaushik (Fellow CA) (85271 Points)
Replied 12 January 2013

Originally posted by : shikhar
	IF there r 3 partners in a partnership firm and, one partner died in the mid of the year (30.09.2012), on 1st jan2013 one partner also join the firm . i am searching answers for following questions. (1) wht changes should be maid in partnership dead, weather i hv to go with new partnership dead or supplimentary dead is sufficient?? (2) should i continue the firm with similar PAN?? or i hv to apply new ??? (3) if i use similar pan then weather i hv to intimate to PAN authority regarding change in partnership dead??? (4)whts should be the impact on income tax return filling for the above. Waiting for your valuable replies.

1. Supplementary partnership deed should be sufficient.

2. There is no need to apply for new PAN card

3. there is no need to inform the changes to PAN authorities

4. There is no impact on income tax return filing per say except for: (a) in ITR5 in sheet "NATUREOFBUSINESS", mention that there has been change in partnership

Further, you should be guided by the specific provisions in the income-tax act relating to changes in partnership etc.

karan jit singh (Consultant) (1299 Points)
Replied 12 January 2013

Originally posted by : shikhar
	IF there r 3 partners in a partnership firm and, one partner died in the mid of the year (30.09.2012), on 1st jan2013 one partner also join the firm . i am searching answers for following questions. (1) wht changes should be maid in partnership dead, weather i hv to go with new partnership dead or supplimentary dead is sufficient?? (2) should i continue the firm with similar PAN?? or i hv to apply new ??? (3) if i use similar pan then weather i hv to intimate to PAN authority regarding change in partnership dead??? (4)whts should be the impact on income tax return filling for the above. Waiting for your valuable replies.

Please see the clause of conitunuance of business by remaining partners in case of dissolution in original deed. What your original partnership deed said about the continuance of business in case of outgoing partner. And as far as the registration of deed, there is no compulsory provisions regarding registration of the deed but it will be good for the firm to get register it. As the firm can sue only after registering itself with the registrar of firms & societies.

And if there is a provision in your original deed for continuance of business than you have make a ded of dissolution & in the same deed you can enter new partners.

And if there is no provision regarding continuance of business than make changes in the clause by making a subsequent deed with original partners.

I hope this will be help for you.

2. No , but not sure

3.No, but not sure.

4.No impact on firm;s ITR

CS,CA F,Numrologi TusharSampat (CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert) (85930 Points)
Replied 12 January 2013

Ans to ur all q is hereunder :

(1) wht changes should be maid in partnership dead, weather i hv to go with new partnership dead or supplimentary dead is sufficient??

Ans-u have to file new ammended deed as there is change in constitution of original firms.Refer sec 182-187 of Income tax act also.

(2) should i continue the firm with similar PAN?? or i hv to apply new ???

Ans- Yes, as there is 1old partner and itrequires only in case when there is totally new n diff partners then original ones.

(3) if i use similar pan then weather i hv to intimate to PAN authority regarding change in partnership dead???
Ans- No,but u need to the inform jurisdictional A.O when any assessment proceedingsare started.

(4)whts should be the impact on income tax return filling for the above.
Ans - Nil.jus only when anything about constituency is asked in itr u need to infrm.

HOPE UR QUERRY IS SOLVED.