11 Sep

Agreement To Share Profits Implies

The misappropriation of the income of a partner from the main company at source to the sub-company by an overall obligation resulting from a sub-company transforms the income of a partner into the income of the sub-company and thus confers on the sub-company an enforceable right to claim a share of the profits paid to a partner or partner. The right to obtain profits and bear losses becomes the asset of the sub-company. A sub-company which obtains a share of the profits of a partner in the main company must be regarded as a member of the main company for the limited purposes of Article 10(2)-A of the Law on Income Tax. A profit-forwarding agreement should indicate all parties involved with the name and address at the beginning of the contract. You should write the name of the company you are creating at the beginning of the agreement as well as the purpose of the business. Add references to the date of the agreement as well as the expected duration of the agreement. The accounts into which the profits are paid and when those profits are paid shall be indicated. Rules on the management of the departure of a partner following a death or cessation of activity should also be included in the agreement. These terms may include a purchase and sale agreement detailing the valuation process or require any partner to maintain a life insurance policy that designates the other partners as beneficiaries. A partnership company cannot become a partner in another partnership company within the meaning of the Indian Partnership Act 1932, because a company is not a person under that Act and therefore does not have the right to enter into an agreement. However, the situation is different with regard to the Income Tax Act. A `person` has been defined in Section 2, paragraph 31, which includes, inter alia, an undertaking.

The capital is the amount contributed by the partners of the partnership for the purpose of creating or carrying out the partnership activity and which is generally expressed in cash, even if the contribution was a property or a good-business or goodwill. A partner`s participation in the capital in the partnership relates to the amount contributed and differs from its share of the partnership`s assets, which relates to its share in the partnership under the social contract (see paragraph 53.60) (provided that there is one – see paragraph 53.54). .

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