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 14 Replies

D.V.RamaKrishna (Advocate)     25 May 2009

Yes, a partnership firm is also a juristic person and it can do all such acts and activities like any other juristic person such as a company, individual etc provided the partnership deed provides for the manner of investments of its funds

1 Like

Sunu (Company Secretary)     28 May 2009

I beg to differ from the view already expressed:

A Partnership firm cannot be a member of a Company. The membership has to be in the name of the partners of the firm. There is a clarification from the Department of Company Affairs stating that "a firm, not being a person cannot be registered as a member of the Company except when the Company is licences under Sec 25 of the Companies Act, 1956.

Regards

Sunu

 

Arjun Thakkar (CS)     28 May 2009

CS Sunu is absolutely right

Abhishek (Lawyer)     24 July 2009

Partnership firm can invest in shares. CS Sonu is absolutely right that Partnership firm can not become member of the company as it doesnot have a seprate legal status like company. But Demat account can be opened in the name of the partners and broking account can be opened in the name of partnership firm. Partners can unanimously appoint authorised partner who will issue instructions to broker for purchasing and selling the shares. For this porpose Partnership PAn no. should be given.So the main answer is yes partnership firm can invest in shares market but cannot hold shares in partnership firm's name.

Smita_L01042008 (student)     12 December 2009

please clarify your query. in case partnership firm is intend to open a trading account and deal in the buying and selling in stock market. then a partnership can open trading account in its name

shonaly ALVA (bANKER)     12 February 2010

can a partnership firm wherin the partners are pvt ltd companies open a demat a/c...can the demat a/c be opened in the name of the pvt ltd companies jointly

Suresh CSLLM (Service)     12 February 2010

In India partnership firm does not recognized as seprate legal entity. A firm always goes with its partners.

A firm can invest in a company and accordingly can become member through one or more of its partner. If partner holds shares in a company on behalf of the firm, Section 187C of the Company should be complied with.

Suresh

 

 

 

1 Like

sandesh trivedi (-)     30 March 2010

 

Partnership firm can invest in shares. CS Sonu is absolutely right that Partnership firm can not become member of the company as it doesnot have a seprate legal status like company. But Demat account can be opened in the name of the partners and broking account can be opened in the name of partnership firm. Partners can unanimously appoint authorised partner who will issue instructions to broker for purchasing and selling the shares. For this porpose Partnership PAn no. should be given.So the main answer is yes partnership firm can invest in shares market but cannot hold shares in partnership firm's name.


If shares cant be held in the partnership firms name then whose name is it held?

CA Adarsh Agrawal (CMD of SHAYVIDZ Group)     30 March 2010

Originally posted by :adv.ranchi
" Can partnership firm invest in shares in india? "

Share can be purchased by Partner subject to partnership deed & the beneficiary will be the partnership firm.

Anjali Singh (Assistant Company Secretary)     12 June 2010

From the above it can be interpreted that in the Register of members and share certificate it should be mentioned Partners name to whom the firm has delegated the powers, also mentioning  on whose behalf it is been invested.

Further as Sec187C has to be compiled. Would like to know if the same has not been compiled with in past what would be the remedial measures at present..

Khandaker Habibuzzaman (abc)     05 January 2011

Can any one pls explain what is  "Legal status/entity" means.

Vishnu (Student)     20 January 2011

Sonu is absolutely correct. The Department Circular which talks about a firm not being a member is Circular 4/72 dated 9 March, 1972. 

Aman Agarwal   28 March 2022

what is the taxation i need to follow in case of investment partnership? capital gains or income tax?

 

Prabhu Kumar   03 November 2022

Partnership firms are permitted to invest in the stock market but are not permitted to hold shares in their own names. If you decide to join a partnership, the profit distribution will be in accordance with the partnership agreement, which allows you to specify a separate operational or professional payment for yourself. You will only invest in a partnership firm for the purpose of sharing profits with your partners. You can participate in share trading with Share India. The leading brokerage house provides financial services to all kinds of individuals and businesses. It has a reputation of providing excellent services and customer support system. The brokerage charges are quite reasonable too.
 


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