Members base cannot exceed 50 in case of AOP

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Members base cannot exceed 50 in case of AOP


How many number of members can be there in an AOP?
Can we add the new member’s in existing AOP ? 
Opinion :
1. New members can be admitted as members of AOP subject to any restriction in the deed forming the AOP
2. The number of members should not exceed 50. If it exceeds 50, it would amount to violation of section 464 of Companies Act read with Rule 10 of Companies (Miscellaneous) Rules, 2014. If it exceeds 50, each member would be liable for fine which may extend upto Rs 1 lakh. 
3. So once the number of members exceed 50, it should get registered as a Company 
4. The money that is brought in by the new members can be shown as capital contribution 
5. If upon admission of new members, the existing members receive any money from the AOP, section 45(4) of Income-tax  Act might get triggered.  
6. If any capital asset is received by the existing members upon admission of new members, section 9B and section 45(4) might get triggered.

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