STAMP DUTY ON TRANSFER OF IMMOVABLE PROPERTY ON CONVERSION OF COMPANY INTO LLP

[deepak gulati]

WE ARE CONVERTING A PRIVATE LIMITED COMPANY IN TO LLP.THE COMPANY OWNS A IMMOVABLE PROPERTY.PLEASE TELL WEATHER THE IMMOVABLE PROPERTY IS REQUIRED TO RE-REGISTER IN THE NAME OF LLP BY PAYING STAMP DUTY

[Mahir S]

Section 58(4)(b) of LLP Act,2008 provides that on conversion of a company into LLP, “all tangible (movable or immovable) and intangible property vested in the partnership firm or the company, as the case may be, all assets, interests, rights, privileges, liabilities, obligations relating to the partnership firm or the company, as the case may be, and the whole of the undertaking of the firm or the company, as the case may be, shall be transferred to and shall vest in the limited liability partnership without further assurance, act or deed.”

Therefore, there should be no stamp duty implications on conversion to LLP, where there is immovable property for the firm because the transfer is by operation of law so that there should be no need for fresh registration of properties. All movable and immovable properties of the company automatically vest in the LLP. No instrument of transfer is required to be executed and hence no stamp duty is required to be paid.

AI Summary

Conversion to LLP: immovable property vests by operation of law, avoiding need for fresh transfer or stamp duty.
Conversion of a company into an LLP effects automatic vesting of all movable and immovable property, assets, rights and liabilities in the LLP without further assurance, act or deed, so no instrument of transfer is required and no stamp duty or fresh registration arises from that vesting.