https://www.taxtmi.com/caselaws?id=23904 Admission of new partners into a firm, coupled with their capital contribution, was treated as adequate consideration for reconstitution of partnership interests. On that basis, a reduction in an existing partner's share in future profits did not amount to a taxable gift under the Gift-tax Act merely because the profit-sharing ratio changed. The involvement of goodwill did not alter the position, since the capital introduced by the incoming partners supported the transfer of partnership rights as part of the business reallocation as a whole. The effect was that the reduced share interest was not chargeable to gift-tax. en-us Wed, 08 Mar 1989 00:00:00 +0530 Fri, 15 Jan 2010 11:42:20 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=23904 Admission of new partners into a firm, coupled with their capital contribution, was treated as adequate consideration for reconstitution of partnership interests. On that basis, a reduction in an existing partner's share in future profits did not amount to a taxable gift under the Gift-tax Act merely because the profit-sharing ratio changed. The involvement of goodwill did not alter the position, since the capital introduced by the incoming partners supported the transfer of partnership rights as part of the business reallocation as a whole. The effect was that the reduced share interest was not chargeable to gift-tax. Case-Laws Income Tax Wed, 08 Mar 1989 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=23904