| 17A |
Issues relating to change in firm name/seniority of firms in such cases including cases covered by reconstitution of firms in general
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Chapter17A |
Issues relating to change in firm name/seniority of firms in such cases including cases covered by reconstitution of firms in general
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The Council considered the issues relating to change in firm name/seniority of firms in such cases including cases covered by reconstitution of firms in general and decided as under :- |
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PARTICULARS OF CASES
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| 1. Propreitorship to firm: |
Seniority |
A member practising as a sole properietor in a trade name, admits one or more members as partners thereby constituting a firm, and
a. the firm name is the same trade name
b. the firm name is different from the
trade name
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The date of establishment of practice in the trade name
The date of approval of the firm name or the date of establishment of the firm in the firm name, whichever is later |
| II. Death of the individual member
If the member practising in a trade name dies and if the trade name is sold/assigned to another member and if the other member practises (either as sole properietor or in partnership with others) immediately after such sale/assignment
- In the same trade name
- In the new trade/firm name
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Date of establishment as recognised by the Institute in the case of the deceased member if the sale/assignment is made (within one year from the date of death of the member)
The date of approval of the new trade/firm name or the establishment of practice under new trade/firm name by other member/members, whichever is later.
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| III. Partnership firms
a Firm consisting of two partners - If one of the partners retires/dies and if the remaining partner continues either as sole proprietor or in partnership with others,
- in the same firm name
- in a new firm name
Firm consisting of more than two partners - If one or more of the partners dies/retires and the remaining partners continue to practise in the same firm name with or without dissolution |
There is no change in the date of the establishment of the firm
Date of approval of new firm name or the date of establishment of the firm under the new firm name, whichever is later
There is no change in the date of establishment of the firm |
| IV. Merger or amalgamation of two or more firms
If two or more firms merge/amalgamate, the new firm after merger/amalgamation practices
- in the firm name of one of the merged firms
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in a new firm name
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Date of establishment of the firm, which firm name is continued to be used after merger
The date of establishment of the new firm |
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| Example |
Name of
Firm |
Name of
Firm |
Name of New
Firm |
1.A &
Co. 1966 |
B & Co. 1980 |
A & Co. |
2.A & Co. 1966 |
B & Co. 1980 |
B & Co |
3. A & Co. 1966 |
B & Co. 1980 |
Y & Co. |
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V. Change in trade/firm name |
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The member/firm continues the practice (with or without change in constitution ) with the change in trade/firm name |
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Seniority |
Date of establishment will be 1966
Date of establishment will be 1980
Date of establishment will be date of approval of Y & Co. by the Institute or constitution of the Partnership firm, whichever is later |
- Change of name from the date of approval.
- There is no change in the date of establishment. The old trade/firm name will be frozen in the Institute's records for three years from the date of approval of the new trade/firm name. In the constitution certificate issued by the Institute during that period of three years, the name will be mentined as "M/s............(formerly known as M/s.............)"
During that period of three years, the firm will be given the option to have its original name at the choice of all the partners only if all those partners so apply to the Institute in the prescribed manner |
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| Note |
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Trade name: The name is which the member practices as a sole proprietor.
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Firm name : The name in which the firm practises.
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`Trade name' and `Firm name' are the names as approved by ICAI.
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Merger/amalgamation is a term not applicable to firms under the Partnership Act. It is reconstitution of firm by addition/deletion of partners. The principles applicable to any reconstitution will, therefore,apply in these cases."
The Council further decided that its decision as narrated in Sr. No. V above should also be applicable in the case of merger or amalgamation of two or more firms as narrated in sr. no. IV (ii) |
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Particulars of cases
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Seniority |
I |
X |
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X |
X |
X |
X |
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X |
X |
X |
X |
X |
X |
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X |
X |
X |
X |
X |
X |
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Merger of amalgamation of two or more firms.
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If two or more firms merge/amalga- mate, the new firm after merger/ amalgamation practice |
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- in the firm name of one of the merged firms
- in a new firm name, in cases where the existing firm is
seeking change of firm name and approval thereof
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- Change of name from the date of approval
- There is no change in the date of establishment. The old trade/firm name will be frozen in the
Institute's record for Three years from the date of approval of the new trade/firm name. In the constitution certificate issued by the Institute during that period of three years, the name will be mentioned as M/s ......(formerly known as M/s. ....)
During that period of three years, the firm will be given the option to have its original name at the choice of all the partners only if all those partners so apply to the Institute in the prescribed manner
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The Council also decided that in the three examples given in the aforesaid decision to illustrate the seniority against "IV Merger or amalgamation of two or more firms", fourth example to deal with seniority when two or more firm merge and decide to adopt a name by combining the names of said firms, should also be given. The fourth example approved by the Council to be added, is as under :-
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Name of Firm |
Name of Firm |
Name of New Firm |
Seniority |
4, A&Co., 1966 |
B&Co., 1980 |
Either AB&Co or BA & Co |
Date of establishment will be |
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