Conversion of sole proprietorship to partnership

Querist : Anonymous (Querist) 23 February 2010 This query is : Resolved
My husband's elder brother is running a sole proprietorship business. My husband is also a silent sharer of profits therein. Now they want to enter into a partnership business. My husband's elder brother is having a CC Loan in proprietorship mortgaged upon my husband's vacant land. How will this loan be taken in the new partnership business?

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B K Raghavendra Rao (Expert) 23 February 2010
Balance amount of loan in the sole proprietorship business as on the date of formation of partnership firm is to be calculated and taken as the liability of your husband's elder brother.

Liabilities further to entering upon partnership shall be shared in the ratio agreed upon as per the terms of partnership ship deed.

Querist : Anonymous (Querist) 24 February 2010
Dear Mr. Rao,
Thanks for the reply.
Shall the liability be entered as only in my husband's brother's name as the guarantor of the CC Loan is my husband himself being the owner of the land which has been mortgaged for getting the loan.