Whether Partner Transfer his share in Asset of the Firm to his wife by Gift Deed?!

Consultant

Hi,
One of the Partner wish to Transfer his share in Asset of the firm to his wife.

Simply, his family member (wife) Name needs to be inserted instead of his name in the land which is now Firm owned, implicitly, he & his cousin are the current joint owners/partners. As the said partner is the major investor/managing partner of the firm (which is Non-functional currently), he holds 60% of share & the rest is his partner's, as per Partnership deed.

So, Can he Transfer the land (Undivided Property) DIRECTLY TO HIS WIFE IN WAY OF GIFT/SETTLEMENT as said in Transfer of Property Act (OR) He needs to brought her in as an INCOMING PARTNER OF THE FIRM (HE OUT..) AND TRANSFER ALL HIS RIGHTS/INTERESTS/SHARES OF PARTNERSHIP TO HIS WIFE?

Else, is it necessary/mandatory to make a SALE DEED BY HIM ALONG WITH OTHER PARTNER(S) & Transfer the land to his wife, in case not inducting her in Partnership? (Whereas, Stamp duty for Gift deed is only 1% but it is 7% for Sale deed, plus Registration costs 1%.)

In order to refrain from spending any extra costs unnecessarily, Either he may wish to continue in Partnership Or inducting his wife as partner, he would like to transfer/settle his share to his wife by way of Gift deed, with other partner's consent. So, what is the simple way out or how the Law to be enforced here..?!

Thanks in advance.
 
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ha21@rediffmail.com Mumbai : 9820174108

1. Property belonging to a Firm's name CANNOT be transferred by partner to his Wife, since this would constitute a prosecutable offence.

2. Partner can transfer his Partnership Share to his Wife, via a registered Gift Deed.

Keep Smiling .... Hemant Agarwal
VISIT: www.chshelpforum.com


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subregistrar/supdt.(retired)

The firm's property cannot be transferred to any person.  Therefore it is better, that the present partners may induct her as an incoming partner with some share by reducing the share of her husband.  otherwise,  her husband may retire from the business by joining her in his place by executing a Reconstitution of Partnership deed.


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Consultant

Dear Mr.Hemant & Mr.Satya,
Thanks for your immd respond.

From your abovesaid points, Need some clarification as below:

If a Partner transfers his Partnership Share to either his wife/family or non-family member,

(OR)

While Re-constitution of Partnership,

HOW the Firm land (purchased in the name of Firm, representing by its partners) to be treated...and WHO will be the Owner(s) of the said Property?! HOW THE CLAIMANT & EXECUTANT IN EC REFLECTS? Whether it can be automatically converted to Continuing/Incoming Partners as done in Companies Act or is to be re-registered in the name of New/Incoming partners...or just "Relinquishment & Reconstitution Deed" is enough by mentioning Outgoing and Incoming partners, as said above?!

And, Is any seperate Stamp charges to be lieved for transferring the Firm property again to all Continuing partners including the new one inducting..and is that all these required?!

My understanding is that "As per law of the firm, unlike company, Partnership Firm is not a legal entity. Hence the property is not registered in the name of a registered partnership concern. This makes the difference between company and partnership firm."

Still there's a confusion that Firm is a legal entity or not and HOW THE FIRM LAND TRANSFERRED TO INCOMING PARTNERS WHEN THE CONSTITUTION CHANGES (as per Land Transfer Act or Registration Act) OR HOW THE PARTNERSHIP SHARES TO BE TRANSFERRED TO THE NEW ONE INDUCTING (EITHER WIFE OR NON-FAMILY)?!

ALSO, REQUEST YOU TO SEND ME THE FORMAT OF GIFT DEED OF TRANSFERRING SHARE TO WIFE OR ANY JUDGEMENT PERTAINING TO OUR SUBJECT MATTER.

Appreciate your immd reply.
 
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