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the high court which has jurisdiction over lakshadweep
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Answer / falgun buch
The High Court of Kerala, Ernakulam is the High Court for
Lakshadweep.
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There are three partners in a partnership firm. The firm has office premises in the name of firm. Depreciation on this asset is charged every in the books of the firm. Now after depreciation the book value of this assets has become Rs. 1000. Whereas the market vakue of this premises id Rs. 10 crorer. To bring this property at MV the partners revalued this premised at Rs. 8 crorers in the books of the firm and accordingly credited partner's capital account in their profit sharing ratio. My questions are as under. What is the income tax liability of the firm on revaluation? What is the income tax liability of partner of each partner on revaluation and credit to his capital account. In future whether depreciation to the firm is allowed on revalued amount under the income tax act. What happens to the tax liability if one partner withdraw his entire capital from the firm which includes credit on revaluation of office premises? When partners can withdraw out of their credit balance in their capital account without attracting any tax liability either by the firm or by partner? What happens if one partner retires and he gets amount equal to his capital account which inclides credit on account of revaluation? is there any tax liability to the retiring partner?
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