| Question And Answer | |
|---|---|
| Subject: | Capital contribution by partners |
| Category: | Income-Tax |
| Querist: | Akshay |
| Answered by: | Advocate Shashi Ashok Bekal |
| Tags: | Capital contribution, Limited liability partnership, LLP |
| Date: | August 10, 2023 |
The LLP in there agreement obligated to contribute 20 lakhs each by four partners. On 15th dec 2022. However till 31st March 23 nil contribution made by the partner. My query is can we show 80 lakhs as capital contribution and corresponding 80lakhs as receivable from partners in current assets as on 31st 2023 balance sheet.
Thk in adv.
As per section 32(1) of the Limited Liability Partnership Act of 2008, a contribution can be made in the form of a tangible, movable or any form of immovable or intangible property or any other form of benefit to the limited liability partnership which can include money, promissory notes and other agreements which can contribute cash or property and contracts for services performed or to be performed. Furthermore, Partnerships are based on the law of contracts and mutual understanding between the partners. Therefore, it appears that there shouldn’t be a problem with the proposed journal entries.