The assessee, an LLP, was a partner in a partnership firm from where it derived profits. While filing its Return, it claimed an exemption under s. 10(2A) of the Act. The exemption was disallowed by Revenue Authorities, stating that a firm cannot be a partner in another firm. Tribunal, after analysing various provisions of the Indian Partnership Act, 1932, the LLP Act, 2008, and the General Clauses Act, 1897, observed that the liability of partners of the LLP and liability of the LLP as a partner under the Partnership Act would be different. The liability of partners in an LLP cannot have any relevance when the LLP itself becomes a partner. In such cases,\u00a0 the provisions of the Partnership Act will apply to an LLP. It also observed that the LLP is a distinct body corporate and a \u2018person\u2019 separate from its partners and hence characteristically differs from a partnership firm. Referred\u00a0 \u00a0Dulichand Laxminarayan\u00a0v.\u00a0CIT\u00a0AIR 1956 SC 354.(AY. 2020-21)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 10(2A) : Share income of partner-The Limited Liability of Partnership,(LLP) being a distinct person from its partners can become a partner in a partnership firm and is also eligible to claim the exemption. [S. 2(23), Indian Partnership Act, 1932 ,S. 4,25,26,49, Limited Liability of Partnership ,Act, 2008,S.. 14,General Clauses Act, 1897, 3(42)] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-41600","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-aOY","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/41600","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=41600"}],"version-history":[{"count":2,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/41600\/revisions"}],"predecessor-version":[{"id":45642,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/41600\/revisions\/45642"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=41600"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=41600"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=41600"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}