BRIEF OUTLINE OF MEANING AND REGISTRATION PROCESS OF LIMITED LIABILITY PARTNERSHIP ACT 2008

u   THE LIMITED LIABILITY PARTNERSHIP ACT,2008

u   BUSINESS LAW/CORPORATE LAW

u   QUESTION: DISCUSS THE MEANING AND REGISTRATION PROCESS OF LIMITED LIABILITY PARTNERSHIP UNDER LLP ACT 2008

u    ANSWER:-LLP IS VIEWED AS AN ALTERNATIVE CORPORATE BUSINESS VEHICLE THAT PROVIDES THE BENEFIT OF LIMITED LIABILITY BUT ALLOWS THE MEMBERS THE FLEXIBILITY OF ORGANIZING THEIR INTERNAL STRUCTURE AS A PARTNERSHIP BASED ON MUTUALLY ARRIVED AGREEMENT.

u   LEGAL FRAMEWORK IN INDIA    :

u   GOVERNED BY LIMITED LIABILITY PARTNERSHIP ACT,2008 AND LIMITED LIABILITY PARTNERSHIP RULES,2009

u   LIABILITY PARTNERSHIP RULES 2009 CONTAINS PROVISIONS FOR FORMATION, MGMT, RECONSTRUCTION AND WINDING UP OF LLPS.

u   CENTRAL GOVT CAN MAKE ANY APPLICABLE ANY PROVISIONS OF COMPANIES ACT BY NOTIFICATION

u   THE INDIAN PARTNERSHIP ACT,1932 SHALL NOT BE APPLICABLE                             

u   FEATURES

1. BODY CORPORATE AND LEGAL ENTITY SEPARATE FROM ITS PARTNERS
2. CAN BE FORMED BY MINIMUM TWO PERSONS OR MORE FOR LAWFUL BUSINESS BY SUBSCRIBING THEIR NAMES TO INCORPORATION DOCUMENT
3. NO UPPER LIMIT
4. PERPETUAL SUCCESSION LIKE COMPANIES
5. THE MUTUAL RIGHTS AND OBLIGATIONS UNDER THEIR OWN AGREEMENT OR BY THE ACT
6. NEW PARTNERS SHALL BE ADMITTED AS PER PROVISIONS OF LLP AGREEMENT
7. EVERY LLP HAS TO HAVE AT LEAST TWO DESIGNATED PARTNERS(INDIVIDUALS)  AT LEAST ONE OF THEM SHOULD BE RESIDENT IN INDIA.
8. TO MAINTAIN ANNUAL ACCOUNT SHOWING TRUE AND FAIR PICTURE OF STATE OF AFFAIRS
9. THE FRAMEWORK OF LLP IS NOT RESTRICTED TO PROFESSIONAL SERVICES ALONE.
10. A FIRM ,PRIVATE COMPANY OR AN UNLISTED COMPANY IS ALLOWED TO CONVERT ITSELF INTO LLP
11.  CENTRAL GOVERNMENT MAY APPOINT INSPECTORS
12. WINDING UP OF LLP MAY BE EITHER VOLUNTARY OR BY THE TRIBUNAL

u   EXTENT AND LIMITATION

1.     PARTNER IS THE AGENT OF LLP AND NOT OF THE PARTNERS

2.     NOT BOUND BY THE ACTS OF PARTNERS ( NO AUTHORITY)

3.     OBLIGATION OF LLP SHALL BE SOLELY OBLIGATION OF  LLP NOT OF PARTNERS

4.     UNLIMITED LIABILITY IN CASE OF FRAUD

5.     CONTRIBUTION BY PARTNERS MAY BE TANGIBLE,INTANGIBLE,MOVABLE OR IMMOVABLE

u   PROCEDURE OF INCORPORATION

u   PRE REQUISITES:-

1. AT LEAST TWO PARTNERS
2. 2 INDIVIDUALS DESIGNATED PARTNERS
3. DIGITAL SIGNATURE CERTIFICATE
4. LLP NAME
5. LLP AGREEMENT
6. REGISTERED OFFICE

7. DECIDING THE PARTNERS AND DESIGNATED PARTNERS:_
8. OBTAINING DPIN AND ELECTRONIC SIGNATURE
9. DPIN IS AN EIGHT DIGIT NUMERIC NUMBER ALLOTTED BY CG
10. ON LINE APPLICATION e form 7 ALONG WITH FILING FEE OF 100
11. DIGITAL SIGNATURE CERTIFICATES:- FROM AUTHORIZED CERTIFYING AUTHORITIES

u   PROCEDURES FOR INCORPORATION

u   NAME AVAILABILITY

u   NOT BE SIMILAR OR IDENTICAL

u   NOT PROHIBITED

u   SELECT PROPOSED NAME( 6 CHOICES)

u   E FORM 1 ALONG WITH FEES 200

u   DETAILS OF MINIMUM TWO DESIGNATED PARTNERS

u   DRAFTING OF LLP AGREEMENT

u   NAME OF LLP

u   NAME OF PARTNERS AND DESIGNATED PARTNERS

u   FORM OF CONTRIBUTION

u   PROFIT SHARING RATIO

u   RIGHTS AND DUTIES OF PARTNERS

u   PROPOSED BUSINESS

u   RULES FOR GOVERNING THE LLP

u   PROCEDURE OF INCORPORATION

1. FILING OF INCORPORATION DOCUMENTS
2. DOCUMENTS REQUIRED:
3.  E FORM1 –NAME AVAILABILITY
4. --------2- INCORPORATION DOCUMENT
5.              3  DETAILS OF LLP AGREEMENT
6.              4 CONSENT OF PARTNERS
7.               9  APPLICATION FOR DESIGNATED PARTNERS IDENTIFICATION NUMBER
8. SUBSCRIPTION SHEET
9. DULY STAMPED LLP AGREEMENT
10. PROOF OF REGISTERED ADDRESS
11. CONSENT OF PARTNERS AND DESIGNATED PARTNERS
12. PROCEDURE OF INCORPORATION
13. INCORPORATION DOCUMENTS
14. FILL UP FORM 2
15. DIGITALLY SIGNED BY DESIGNATED PARTNER AND DIGITALLY SIGNED BY AN ADVOCATE/CS/CA/COST ACCOUNTANT
16. SUBSCRIPTION SHEET ALSO HAVING SIGNATURE OF WITNESS
17. REGISTRATION FEES

u   REGISTRATION

I.        SEPARATE LEGAL ENTITY

II.        EASY TO ESTABLISH AND EASY TO DISSOLVE

III.        PERPETUAL EXISTENCE

IV.        LLP AND ITS PARTNERS ARE SEPARATE

V.        FLEXIBILITY

VI.        PERSONAL ASSETS ARE NOT EXPOSED EXCEPT FRAUD