The Limited Liability Partnership Act, 2008

Click to edit Master subtitle style Sub- Business Law SYFM PRO - RAJNISH

4/21/12

INDEX
I.

INTRODUCTION COMPARITION SECTIONS CONCLUTION

I.

I.

I.

4/21/12

INTRODUCTION

An Act to make provisions for the formation regulation of Limited Liability Partnerships and for matters connected therewith or incidental thereto.

Limited Liability Partnership agreement means any written agreement between the partners of the limited liability partnership or between the limited liability partnership and its partners and their rights and duties in relation to that limited liability 4/21/12 partnership;

COMPARITION
PARTICULAR Partnership firm Limited Liability Partnership Registration Mandatory Private company Public company

Registration

Registration Optional

Registration Mandatory LLP is Body Corporate

Registration Mandatory LLP is Body Corporate

Partnership LLP is Body Firm not Body Corporate Body Corporate corporation Registering AuthorityRegistrar of Firms Registering AuthorityRegistrar of Companies

Registering Authority 4/21/12

Registering AuthorityRegistrar of Companies

Registering AuthorityRegistrar of Companies

PARTICULAR

Partnership firm Min. No. of Partner -2 Max. no. of Partners:

Limited Liability Partnership

Private company

Public company

Min & Max No. of Partner Banking - 10 Non-Banking 20 Rights

Min. No. of Min. No. of Min. No. of Partner -2 Part Shareholder-7 Max. no. of shareholder Max. no. of Partners - No -2 Shareholders Limit Max. no. of No Limit Shareholders 50

Voting Rights One vote per One vote per One vote per not applicable Partner member on member on show of hands show of hands Liability of Partners is unlimited joint and several Liability of Partners is limited to the extent of Contribution made except under certain Liability of Liability of shareholders shareholders is limited to is limited to the extent of the extent of shares held shares held

Liability 4/21/12

Chapter I titled Preliminary

Contains 2 Sections Section 1: Describes the title, jurisdiction and effective date of the Act

Section 2: Contains definitions of terms used in the Act

4/21/12

Chapter II titled Nature of Limited Liability Partnership

Contains 8 Sections

Section 3: LLP is a separate legal entity and it is a body corporate Section 4: Partnership Act 1932 is not applicable to LLPs except as provided Section 5: Who can and who cannot be partners of an LLP Section 6: Min. no. of Partners and Personal Liability if the number falls below 2 Section 7: Designated Partners Requirements for appointment etc
4/21/12

Section 8: Responsibilities and Obligations of Designated Partners

Chapter II titled Nature of Limited Liability Partnership

Section 9 : Filling up of vacancy in Designated Partners and consequences of failure Section 10: Penalty for contravention of provisions of Section 7 (1), (4), (5), Section 8 and Section 9
4/21/12

Chapter III titled Incorporation of LLP and Matters Incidental thereto Contains 11 Sections

Section 11: Incorporation of LLP, procedure for incorporation and penalty Section 12: Registration of LLP by Registrar and Certificate of Incorporation Section 13: Registered Office and other office of LLP and changes thereof Section 14: Effect of Registration and Powers of LLP
4/21/12

Chapter III titled Incorporation of LLP and Matters Incidental thereto

Section 15: Use of words Limited Liability Partnership or acronym LLP as last words in the name Section 16: Application reservation of name of LLP for approval and

Section 17: CGs power to direct change of name by a LLP already registered

4/21/12

Chapter III titled Incorporation of LLP and Matters Incidental thereto

Section 18: Application by a Company, LLP or Entity to Registrar for directing change of name of LLP registered with similar name Section 19: Change of name by LLP on own volition Section 20: Penalty for misuse of words LLP in the name Section 4/21/12 21: Publishing of name, address and

Chapter IV titled Partners and their Relations

Contains 4 Sections Section 22:How to become partners of a LLP Section 23:Mutual Rights & Duties of Partners inter-se partners and LLP and its partners etc. Section 24:Cessation/Resignation of a partner
4/21/12

Chapter V titled Extent and Limitation of Liability of LLP and Partners

Contains 6 Sections

Section 26: Partner is an Agent of LLP and not of other partners

Section 27: Liability of LLP 4/21/12 when and how much

Chapter V titled Extent and Limitation of Liability of LLP and Partners

Section 29: Person holding out to be a partner shall be liable to creditors Section 30: Unlimited liability of partners and LLP under certain circumstances Section 31: Whistle Blowing benefits to a partner and an employee
4/21/12

Chapter VI titled Contributions

Contains 2 Sections Section 32: Contributions by partners - by way of money, tangible and intangible assets etc. Section 33: Obligation of partners to contribute money or property or other benefit shall be as per LLP Agreement

4/21/12

Chapter VII titled Financial Disclosures

Contains 8 Sections

Section 34: Maintenance of Books, preparation and filing of Statement of Account and Solvency with the Registrar Section 35: LLP to file Annual Return with the Registrar

4/21/12

Chapter VII titled Financial Disclosures

Section 39: Compounding of Offence committed where punishable with fine Section 40: Registrar to destroy documents filed in accordance with Rules Section 41: Registrar may require filing of corrected or amended document etc.
4/21/12

Chapter VIII titled Assignment and Transfer of Partnership Rights

Contains 1 Section

Section 42: A Partner can transfer his rights to share in profits or receive contributions and still continue to be a partner in a LLP etc.

4/21/12

Chapter IX titled Investigation

Contains 12 Sections

4/21/12

Section

Chapter IX titled Investigation

Section 47: Duty of Designated Partners or partners to produce documents Section 48: Inspector to approach First Class Magistrate or Judicial Magistrate for order for confiscation of records or documents Section 49: Inspector to make interim if required by CG and also make final report to the CG
4/21/12

Chapter IX titled Investigation

Section 51: If it is that it is expedient to wind up as per the Order, the LLP shall be wound up by order of Tribunal Section 52: CG may bring proceedings for recovery of damages or property Section 53: Initial expenses of investigation will be borne by CG but upon conviction the person convicted shall bear the expenses
4/21/12

Section 54: The Inspectors Report will be will be

Chapter X titled Conversion into Limited Liability Partnership Contains 4 Sections

Section 55: A Partnership Firm may convert itself into LLP Section 56: A private company may convert itself into LLP
4/21/12

Chapter XI titled Foreign LLPs

Contains 1 Section

Section 59: Central Governments power to formulate rules applicable to foreign LLPs establishing place of business in India

4/21/12

Chapter XII titled Compromise, Arrangement or Reconstruction (CAR) of LLPs

Contains 3 Sections Section 60: Procedure for C or A and Order of Tribunal for C or A Section 61: Tribunal shall have power to supervise carrying out of C or A Section 62: Tribunal may approve C or A 4/21/12 proposal and order the scheme for R or

Chapter XIII titled Winding Up and Dissolution

Contains 3 Sections Section 63: Voluntary Winding up and/or through Order of the Tribunal Section 64: Circumstances under which Tribunal may order winding up Section 65: CG may make rules in relation to winding up of LLPs 4/21/12

Chapter XIV titled Miscellaneous

Contains 16 Sections

Section 66: A partner may lend money or transact business with LLP Section 67: CGs power to notify that provisions of Companies Act, 1956 may apply with or without modifications to LLPs
4/21/12

Chapter XIV titled Miscellaneous

Section 69: Document required to be filed with Registrar if not filed within due date can be filed within 300 days on payment of additional fees and beyond 300 days also Section 70: Imprisonment of partner or designated partner for 2nd and subsequent offences and levy of fine up to twice the amount prescribed Section 71: Provisions of this Act shall be in addition and not in derogation of provisions of any other law

4/21/12

Chapter XIV titled Miscellaneous

Section 73: Failing to comply with order of the Tribunal shall attract imprisonment up to 6 months and shall also be liable to fine of not less than Rs.50,000/Section 74: If the Act is silent on fines, the person can be punishable with fine with Min. of Rs.5,000/and Max. of Rs.50/- per day of default (subject to Maximum amount of Rs.5,00,000/-) Section 75: Registrars power strike off name of LLP if LLP is not carrying on business 4/21/12

Chapter XIV titled Miscellaneous

Section 78: CGs power to alter the provisions of Schedules to the Act Section 79: CGs power to make Rules for carrying out provisions of this Act Section 80: CGs power to make provisions to remove difficulties but the power cannot be exercised after 2 years from the date of commencement of the Act
4/21/12 Section

81: Transitionary provisions until Tribunal

Conclusion
The regime of LLP will provide a platform to small and medium enterprises and professional firms of Company Secretaries, Chartered Accountants, Advocates, etc. to conduct their business / profession efficiently which would in turn increase their global competitiveness. It will eventually foster the growth of services sector.
4/21/12