https://www.taxtmi.com/caselaws?id=62272 Reduction of a partner's profit share on reconstitution of a partnership firm is treated as a taxable gift under the Gift-tax Act, 1958 where the partner receives no consideration in money or money's worth. The alleged benefits from admission of new partners, including capital contribution, sharing of future losses, and participation in the business, may advantage the firm but do not constitute consideration flowing to the partner for surrendering part of his interest. On that footing, surrender of a 20% share in the partnership was treated as a taxable gift, and the reciprocal arrangements were held insufficient to exclude gift-tax liability. en-us Wed, 03 Jul 1996 00:00:00 +0530 Tue, 18 Jan 2011 19:06:09 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=62272 Reduction of a partner's profit share on reconstitution of a partnership firm is treated as a taxable gift under the Gift-tax Act, 1958 where the partner receives no consideration in money or money's worth. The alleged benefits from admission of new partners, including capital contribution, sharing of future losses, and participation in the business, may advantage the firm but do not constitute consideration flowing to the partner for surrendering part of his interest. On that footing, surrender of a 20% share in the partnership was treated as a taxable gift, and the reciprocal arrangements were held insufficient to exclude gift-tax liability. Case-Laws Income Tax Wed, 03 Jul 1996 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=62272