https://www.taxtmi.com/caselaws?id=38634 A partner's right to share in firm profits is property capable of transfer, so a consensual reduction in one partner's share with corresponding increases for others constitutes a transfer amounting to a gift and is chargeable to gift tax. The reallocation was nevertheless held exempt under section 5(1)(xiv) because it occurred in the course of the partnership business and was shown to be bona fide for the effective and profitable working of the firm. The evidence supported the finding of bona fides, and no separate goodwill issue arose. en-us Tue, 27 Jul 1976 00:00:00 +0530 Wed, 07 Apr 2010 17:42:46 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=38634 A partner's right to share in firm profits is property capable of transfer, so a consensual reduction in one partner's share with corresponding increases for others constitutes a transfer amounting to a gift and is chargeable to gift tax. The reallocation was nevertheless held exempt under section 5(1)(xiv) because it occurred in the course of the partnership business and was shown to be bona fide for the effective and profitable working of the firm. The evidence supported the finding of bona fides, and no separate goodwill issue arose. Case-Laws Income Tax Tue, 27 Jul 1976 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=38634