Hi trade in stock market mainly in Future and Options india. My query is me and my friend also some family members want to pool money and then trade in one account.So please let me know is there a legel way to pool all our money and then trade or invest. I will distribute the profit among them . Also can charge them or take a profit share for myself. As i am managing my friends money now and taking profit share as cash.
Asked 4 years ago in Business Law
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If you will form partnership than distribution of profit will be acc. to partnership deed, in deed you can mention separate operational/professional payment for you. You will invest for partnership firm only and profit distribution among partners.
Company not advisable.
What is right choice for me partnership or llp and how many people can join in. Is there captial requirements or can i take any thing from partner for fund.
Asked 4 years ago
LLP has different requirements to fulfill for it`s incorporation and otehr post incorporation liabilities. Hence, Partnership is good.
Advocate, Jaipur
21576 Answers
31 Consultations
partnership firm caninvest insharesmarket but cannot hold sharesinpartnership firm'sname.
1)PAN card Aadhar card is a mandatory requirement for investing
2) . It is required for KYC (know your client) procedure while opening an account with the marketregulator, the Securities and Exchange Board of India (Sebi).
3) the government has mandated six-month bank statement along with a cancelled cheque, under the new rules to open a demat account.
4) Broking account can be opened in name of firm and demat account in name of partners
Llp will be good
Broking account can be opened in name of partnership firm or LLP
2) partnership firm canGenerally have between two and 20 partners. A partnership of more than 20 partners must incorporate as a company under the Companies Act, C
A Partnership firm cannot be a member of a Company. The membership has to be in the name of the partners of the firm. There is a clarification from the Department of Company Affairs stating that "a firm, not being a person cannot be registered as a member of the Company except when the Company is licences under Sec 25 of the Companies Act, 1956.
Partnership firm can not become member of the company as it doesnot have a seprate legal status like company. But Demat account can be opened in the name of the partners and broking account can be opened in the name of partnership firm. Partners can unanimously appoint authorised partner who will issue instructions to broker for purchasing and selling the shares. For this porpose Partnership PAn no. should be given. So the main answer is yes partnership firm can invest in shares market but cannot hold shares in partnership firm's name.
Partnership firm can't be a share holder for any company. partnership firm is a association of person , and is better represented by its partner.
So it's like two people holding shares in joint account. So partners who want to own shares in firm's name have to open demat account in joint name along with partnership proof.
The rules for opening a partnership firm is the same for any other partnership firm.
t is mandatory for allfirmsto apply for registration with the Income Tax Department and have a PAN Card. After obtaining a PAN Card, thepartnership firmis required toopena Current Account in the name of thepartnership firmand to operate all its operations through this bank account.
TheRegistrationof apartnership firmis notcompulsoryunder Part VII of the IndianPartnershipAct, 1932, though it is usually done asregistrationbrings many advantages to thefirm. It is optional for partners to set thefirm registeredand there are no penalties for non-registration
Dear
You can make a partnership firm by deed of partnership and then open Demat on name of firm and then indulge in trading.
The profit or loss will distribute among partners according to partnership deed.
