Legal Question in Real Estate Law in India
My Father- in-law is partner to one other person in his current small scale startup company.
He has his credit in the company to be 70 lacs. Recently he made a withdrawal of 30 lacs from company�s joint account. This money is invested in new business where other partner is not considered.
Is there a law provision which says we can make the deposit amount withdrawn from first firm to make sure we have no debt from the above withdrwal in new firm.
Do this any way mean there is a chance for legal action from the partner. Does he have any stake in the new business which is completely owned by my father-in-law.
2 Answers from Attorneys
28.04.2013
Dear Sir / Madam,
Withdrawal made by your father-in-law from the firm is treated as Drawings. There is no law which says that you cannot withdraw monies as a partner from the firm. But your father in law will remain liable to settle all the liabilities of the firm along with the other partner till the firm is dissolved and finally closed. The existing partner has no stake in your father-in-law's new business.
Regards,
A partner who is entitled to withdraw funds belonging to his share, once withdrawn the money is his, and he can invest the way he likes and only he owns it and he alone is responsible for the same.
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