2. Gift…
A gift is a voluntary transfer of property from one
person to another without any consideration.
A gift involves three elements:
The donor intends to transfer ownership of the property
to the donee immediately.
The donor delivers the property to the donee.
The donee accepts the property.
3. Continued…
An inter vivos gift – is a gift given during life and with
no expectation of death.
The gift is valid, if it meets the basic conditions of a gift.
A gift causa mortis – is a gift given in expectation of
dying soon.
The gift is valid, if it meets the conditions of a gift, and
the giver dies as expected.
The giver may rescind the gift at any time, and it is
automatically rescinded if the giver does not die as
expected.
4. Donor and Donee…
Donor:
A person or entity making a gift or donation is known as
the donor i.e giver of the gift.
Donee:
A person or entity receiving an outright gift or donation
i.e. receiver of the gift.
5. Assignment…
A transfer of rights in real property or personal property to
another that gives the recipient(the transferee), the rights
that the owner or holder of the property(the transferor), had
prior to the transfer. Statutes regulate the extent to which
an assignment may be made.
For Example:
An assignment of wages is the transfer of the right to
collect wages from the wage earner to his or her creditor.
6. Transfer…
Any and every method of removing something
from one person or place to another; specifically,
the handing over of possession or control of assets
or title. Transfer may be affected by assignment, by
delivery, by endorsement, and by operation of law.
7. Proprietorship…
A sole proprietorship, also known as the sole trader or
simply a proprietorship, is a type of business entity that is
owned and run by one individual and in which there is no
legal distinction between the owner and the business.
The owner receives all profits (subject to taxation specific
to the business) and has unlimited responsibility for all
losses and debts.
Every asset of the business is owned by the proprietor and
all debts of the business are the proprietor's. It is a "sole"
proprietorship in contrast with partnerships.
8. Continued…
Glos and Baker write that "A sole proprietorship is
a business owned by one person who is entitled to
all of its profits," and Reed and Conover say "The
single or the sole proprietorship is a business
owned and controlled by one man even though he
may have many other persons working for him." A
sole proprietor may use a trade name or business
name other than his or her legal name
9. Partnership…
Section 4 of the partnership act 1932
defines partnership as “the relation
between persons who have agreed to
share the profits of business carried on
by all or any of them acting for all.”
10. Formation of Partnership…
Partnership may be express (in writing or oral); or may be
implied, i.e. it may be inferred from the conduct of the
parties.
It is based on an agreement between two or more persons
joining hands together to share the profits of the business
carried on by all or any one of them acting for all.
Partnership agreement should comply with the essentials
of an ordinary contract.
Parties of partnership should be competent to contract.
A minor may be admitted to the benefits of partnership
with the consent of all the other partners .
Partnership business and object must be lawful.
11. Continued…
As relationship of partners to one another is that of
agency, no consideration is required to create the
partnership.
Though partnership may be implied from the conduct or
course of dealing of the parties, it is advisable to form
partnerships by an agreement in writing. This agreement is
called a partnership deed which should be adequately
stamped as required by the Indian stamp act 1889.
The partnership deed contains names and addresses of the
partners, name and address of the firm, duration of the
firm, profit sharing management accounts etc
12. Legal status of partnership…
A Partnership firm has no separate legal existence. As it is
a name given to the collective relationship of person it has
no separate legal existence from its partners. The right and
obligation of a firm are infact rights and obligation of the
partners constituting the firm. It is not a legal person and
therefore enjoys no separate right independent of its
partners. However under the income tax act, the firm is
considered a separate legal entity for taxation purpose.
Partners are not individually taxed on the share of income
received by them.
13. Continued…
It is the partner who owns jointly in common the asset
of the partnership. In consequence of the dissolution,
division on allotment of assets to the partners which
follows upon dissolution after discharge of liabilities is
nothing but a mutual adjustment of rights between
the partners and there is no question of
extinguishment of the firms rights in the partnership
assets amounting to transfer of assets. There is
therefore, no transfer of assets involved even in the
sense of any extinguishment of the firms rights in the
partnership assets when distribution takes place upon
dissolution.
14. Limited Liability Partnership(LLP)…
LLP is a new corporate structure that combines the
flexibility of a partnership and the advantages of
limited liability of a company at a low compliance cost.
In other words, it is an alternative corporate business
vehicle that provides the benefits of limited liability of
a company, but allows its members the flexibility of
organising their internal management on the basis of a
mutually arrived agreement, as is the case in a
partnership firm.
15. Feature of LLP…
The LLP is a body corporate and a legal entity separate
from its partners.
Any two or more persons, associated for carrying on a
lawful business with a view to profit.
The LLP will have perpetual succession.
The compromise or arrangement including merger and
amalgamation of LLPs shall be in accordance with the
provisions of the LLP Act 2008.
The Central Government has powers to investigate the
affairs of an LLP, if required, by appointment of competent
Inspector for the purpose.
