CA Siddhi (PRACTICE) (257 Points)
10 January 2012
Argha Ghosh
(Article Assistant)
(21 Points)
Replied 10 January 2012
MD
(AAA)
(117 Points)
Replied 13 January 2012
A company is a juristic person and therefore can become a partner in a partnership firm, if it is authorised to do so by its objects.
However, remuneration should be paid only to a working partner. For this purpose working partner means an individual who is actively engaged in conducting the affairs of the business or profession of the firm of which he is a partner - Explanation 4 to section 40(b) of the Income tax Act.
Hence, in view of above the remuneration cannot be paid to a partner being a company.
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