Whether the partners of an existing firm 'A' can form another partnership 'B' with or without any change in the objects?. The partners of 'A' and 'B' are the same. Is there any court decision accepting such formation?
Formation of more than one partnership
KJ NARAYANAN
Partners Can Form New Partnership with Same Members Unless Aiming to Evade Tax Limits Like Excise or Service Tax. A participant inquired whether partners of an existing firm 'A' can establish another partnership 'B' with identical partners, regardless of changes in business objectives. The response indicated that forming a second partnership is generally permissible unless it is intended to evade tax exemption limits, such as those related to excise or service tax. There was no mention of specific court decisions addressing this issue. (AI Summary)