P.ANNAPURNA 03 January 2020

Conversion of sole proprietorship into pvt ltd company

To convert sole proprietorship into Pvt LTD company a new Pvt company was incorporated. Now by entering agreement can all fixed assets be taken by new company Shares will be alloted to proprietor and he is one of the promoter of the company My question is any stamp duty need to be paid I guess as it's converted to company so no stamp duty required Please resolve it's an urgent issue

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3 Replies

Akshay (Advocate) 29 January 2020

Hii,

Yes, you are right here No Stamp Duty is required to be paid because all movable and immovable properties of the firm automatically vest in the Company.

P.ANNAPURNA 29 January 2020

Ok but as it's come under slump sale few r saying stamp duty attracts

Akshay (Advocate) 29 January 2020

As per section 2(42C) of Income -tax Act 1961, 'slump sale' means the transfer of one or more undertakings as a result of the sale for a lump sum consideration without values being assigned to the individual assets and liabilities in such sales.