SUCCESSION OF FIRM

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umesh (Querist)
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30 May 2017 Suppose there are 2 partners in a firm. Both of them retire on same day & their capital is converted to loan a/c of the firm and 2 new partners are admitted who are family members of retiring partners.. Does this amounts to succession or change in constitution of the firm??? What shall be the income tax implications?

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CA Mohit Kumar

CA Mohit Kumar (Expert)
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30 May 2017 It will be called constitution of firms.. As per income tax, setoff of loss and carried forward is not available to the new firm subject to other conditions..

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umesh

umesh (Querist)
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30 May 2017 Thanx sir Is That means two assessments shall be done 1) upto retirement of pa

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umesh

umesh (Querist)
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30 May 2017 Thanx sir, Is that mean 2 assessment shall be done under income tax? 1) upto date of retirement of all the partners & 2) upto year end for new partners??? If so then weather i should upload 2 b/s & 2 pnl for different periods along with audit reports?? Please clarify Thanks in advance

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