IP, Doha
ANSWER: The tax payer may deduct losses incurred during a taxable year from the net income of subsequent years, subject to losses may not be carried forward from more than three years as of the end of the taxable year during which they are incurred; and losses resulting from an exempt or non-taxable source of income may not be deducted (Article 10 of the Income Tax Law).
As per Article 238 of Commercial Companies law, unless the Articles of Association of the company stipulates otherwise, if a partner who intends to assign his share to a person other than a partner for consideration, he shall notify the other partners of the assignment terms through the company manager.
Each partner shall have right to acquire the share at its actual value and under the same conditions. In the event of disagreement, the company’s auditor shall fix that price on the recovery date.
The partner shall be free to dispose of his shares, if no partner requests recovery of the share after thirty days from the date of notification.
Disciplinary measure
Q: My company has issued a termination letter to me, giving me notice until this month-end. Two weeks ago, I had a small fight with my colleague while we were doing the weekly shopping. Later on, we had settled the issues between us. But the company has mentioned the dispute with the colleague as the reason for my termination. Is it legal to terminate on this ground?
SYI, Doha
A: According to Article 62 of the Labour Law, the company has no right to take disciplinary measure against an employee for any act committed outside the workplace unless such an act is related to the employment and falls within the employee’s duties.
Also, the employer should not penalise an employee on mere accusations and before taking any action, employer should diligently investigate any behavioural or performance problems caused by the employee. You can seek the assistance of the Labour Department for challenging the termination.
Obligations of a witness
Q: My colleague has filed a case against our manager for misbehaving and she has cited me as a witness. But I am afraid about the consequences if I appear in the court as a witness. If a witness fails to appear before the court even after repeated notification, is there any chance of legal action?
FR, Doha
A: As per Article 200 of penal law, if the witness fails to appear before the court, after summoning him in accordance with the law, the court may postpone the case to re-summon him, or order to arrest and bring him before the court. If he fails to attend the second time or to take the oath or testify without an admissible reason, the court may, after hearing the statements of the Public Prosecution, make him subject to the provision of Article 179.
Article 179 states any person, being a witness before a judicial or investigative authority, refuses to appear, take the oath or otherwise withholds testimony before the authority, unless there is a valid excuse for this refusal, shall be punished with imprisonment for a term not exceeding six months or a fine not exceeding R3,000 or both.
When the landlord refuses to accept rent
Q: We have rented a villa in Al Sadd for two years and we used to pay rent by the fourth of every month. Now it’s our 11th month in the villa. When we met the landlord to pay rent recently, he insisted for an increase in rent for the second year. But it is clearly mentioned in the contract that the rent value is for two years and nothing is mentioned about an increase. We are ready to vacate the premises and we don’t wish to renew it after the second year. But the landlord says he will not accept the same rent for the next year. Without receiving the rent, can the landlord seek for eviction on the ground of non-payment?
RP, Doha
A: According to Article 11 of rent laws, if the landlord refuses to accept the rent, the tenant may, within seven days of the date of such refusal, notify the lessor, by registered letter, that the rent is due to be received within seven days, and if the landlord does not accept such rent within the specified period, the lessee shall deposit the rent with the treasury of the Committee for Settlement of Rental Disputes, against no fees. This shall be considered as payment of the rent on the prescribed date.
Both the tenant and the court shall notify the landlord of this deposit by a registered letter. The deposit receipt shall be considered a document absolving the tenant from the value of the due rent to the extent of the amount deposited.
*Please send your questions by e-mail to: [email protected]
LEGAL SYSTEM IN QATAR
According to Article 201, the capital of a capital shall not be decreased except under a resolution issued by the extraordinary general Assembly after hearing the auditor’s report; subject to the approval of the ministry concerned. A capital reduction is permissible in one of the following two cases: (1) Where the capital exceeds the company requirements, or
(2) Where the company incurs losses.
The board of directors shall publish the resolution calling for the reduction of the capital in two local newspapers, of which one shall be in Arabic language, and on the website of the company, if any.
The creditors shall provide the company with documents in support of their debts within 60 days from the date of publication to enable the company to pay their due debts and provide adequate guarantee for payments of deferred debts.
As per Article 204, if the capital reduction is effected by the purchase and cancellation of number of the company shares, all shareholders shall be invited to offer their shares for sale.
Such invitation should be published in two local newspapers, of which one shall be in Arabic language.
The shareholders may be notified by registered letters of the company’s intention to buy the shares.
If the number of shares offered for sale exceeds the amount decided to purchase by the company, the sale applications shall be reduced pro rata to the excess. Share purchase price shall be determined according to the provisions of article of association.
If the article of association is silent in this respect, the company shall pay a fair price determined by the company’s auditor in accordance with the prevailing evaluation methods or the market price, whichever is higher.
According to Article 205, a number of founders of not less than five may establish, among themselves, a private shareholding company which shall not offer its shares for public subscription and they shall subscribe for all the shares. The company capital shall not be less than two million riyals.
Excluding the provisions of the public subscription and share transfer, a private shareholding company shall be governed by all the provisions mentioned in this Law relating to public shareholding company.
As per Article 208, the private shareholding company may transform to a public shareholding company under following conditions:
(1) The nominal value of issued shares must be paid up in full;
(2) The company has been in existence for at least two financial years;
(3) the company must, during the two years preceding the application for conversion, have realised net profits distributable to other shareholders at an average of not less than 10% of its capital;
(4) The resolution calling for the conversion of the company is adopted by a majority of three quarters of the company’s capital in the extraordinary general meeting; and
(5) A decree by the ministry concerned has been issued to transform the company to a public shareholding company and this decision, along with the company’s articles of incorporation and memorandum of association, shall be published, at the company’s expense, in the official gazette.