Stamp duty or registration fees cannot be levied for the conversion of 'Partnership Firm' into 'Limited Liability Partnership'

Upon conversion of a registered partnership firm to a Limited Liability Partnership under the provisions of the Limited Liability Partnership Act, all movable and immovable properties of erstwhile registered partnership firm, automatically vest in the converted Limited Liability Partnership. The transfer of assets of the firm to the Limited Liability Partnership is by operation of law. It being a statutory transfer, no separate conveyance/instrument is required to be executed for the transfer of assets. Since there is no instrument of transfer of assets of the erstwhile partnership firm to the limited liability partnership, the question of payment of stamp duty and registration charges does not arise. These are chargeable only on the instruments indicated in the Stamp Act and Registration Act respectively.

Partnership firm's legal entity after conversion to limited liability partnership does not change. Only the identity of the firm as a legal entity changes. Such conversion or change in the name does not amount to a change in the constitution of a partnership firm. Stamp duty and registration fee cannot be levied upon conversion of a partnership firm to a Limited Liability Partnership. Therefore, permission for recording change of name in the revenue documents, cannot be made dependent upon deposit of stamp duty and registration fee.