Registration of LLP in India

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Registration of Limited Liability Partnership in India : 

Registration of Limited Liability Partnership in India

Limited Liability Partnership(LLP) : 

Limited Liability Partnership(LLP) LLP is means a partnership formed and registered under the Act(Sec.2(n) LLP is a body corporate formed and incorporated under LLP Act and is a legal entity separate from that of its partners.(Sec.3(1) In general, LLP is a separate legal entity, liable to the full extent of its assets; the liability of the partners would be limited to their agreed contribution in the LLP. Further, no partner would be liable on account of the independent or unauthorized actions of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful business decisions or misconduct.

Main Features : 

Main Features The provision of Indian Partnership Act does not apply to LLP(Sec.4) Can sue and be sued(Sec.14(a) Can acquire, own, hold and develop or dispose the movable/immovable/tangible/ intangible property sec.14(b) Common seal (Sec.14(b) All the partners of LLP are entitled to share equally in the capital, profits and losses of LLP. Firms, private companies and unlisted public companies can be converted into LLP. No restriction as to number of maximum partners.

Advantages of LLP : 

Advantages of LLP Separate legal entity Easy to establish Flexibility without imposing detailed legal and procedural requirements Perpetual existence irrespective of changes in partners Internationally renowned form of business in comparison to Company No requirement of minimum capital contribution No restrictions as to maximum number of partners LLP & its partners are distinct from each other Partners are not liable for Act of other partners. Personal assets of the partners are not exposed except in case of fraud. Easy to dissolve or wind-up Professionals like CS / CA / CWA / Lawyers can form Multi-disciplinary Professional LLP No requirement to maintain statutory records except Books of Accounts Less Cost of formation (Compared to a company)

Pre-requisites for registering/incorporating a LLP : 

Pre-requisites for registering/incorporating a LLP 1.Form No. 2(Incorporation Document and Statement)(Rule 11) 2.Form no.3 Information with regard to LLP and any changes(Rule 21) 3. Minimum 2 Partners (Individual or body corporate)(Sec.6(1) and name and address of each partners (Sec.11(2)(e) 4. Minimum 2 Designated Partners who are individuals and at least one of them should be resident in India.(Sec.7(1) and name and adress Sec.11(2)(f) 5.Form N0.9(consent to act as Designated Partner)Rule7&10(8) 6. Digital Signature Certificate 7. LLP Name(Sec.11(2)(b) 8. Proposed business of LLP (Sec.11(2)(c) 9. LLP Agreement 10. Registered Office Sec.11(2)(d)

How to obtain DPIN : 

How to obtain DPIN All designated partners of the proposed LLP shall obtain “Designated Partner Identification Number (DPIN)” Login to www.llp.gov.in by using user name and password Click on the E-Forms Link and open Form no.7 Fill up “Form 7” for allotment of DPIN Pay filing fee of Rs.100 online through credit card (master/visa) Submit the application form online. The system will generate a provisional DPIN. Take the print out of the application form, affix a latest passport size photograph and get it attested/certified for submission physically along with documentary evidences for proof of identify and proof of residence with the Registrar LLP. Deliver the printed and signed application form, along with the prescribed documents by hand/courier/registered post to the Office of Registrar, Ministry of Corporate Affairs, 3rd Floor, “Paryavaran Bhawan”, CGO Complex, Lodhi Road, New Delhi-110003.

How to acquire DSC (Digital Signature Certificate) : 

How to acquire DSC (Digital Signature Certificate) Partner/Designated partner of LLP/proposed LLP, whose signatures are to be affixed on the e-forms has to obtain class 2 or class 3 Digital Signature Certificate (DSC) from any authorized certifying agency, like MTNL CA, TCS, IDBRT, SAFESCRYPT (SATYAM), nCODE Solutions, NIC, Central Excise & Customs(only to their department personnel), e-Mudhra The DSCs are typically issued with one year validity and two year validity. These are renewable on expiry of the period of initial issue. You need to submit application in prescribed form along with the address proof, photo and fee. For more information log on to particular service providers.

Online Registration : 

Online Registration Log on to www.llp.gov.in Register yourself as user by filling the registration and by uploading digital signature Get the username and password Once the name is reserved by the Registrar, log on to the portal and fill up Form-2 “Incorporation Document and Statement”. Pay the prescribed registration fee as per the slab given in Annexure A of the LLP Rules, 2009. Fill up form No.3(Information with regard to LLP agreement and changes, if any made therein) and Form-4 (Notice of Appointment of Partner/Designate Partner, his consent etc.)(It can also be filed within 30 days of the date of incorporation or within 30 days of such subsequent changes.

Who can be the partners : 

Who can be the partners Companies incorporated in and outside India LLP incorporated in and outside India Individuals Resident in and outside India In case any Body Corporate is a partner, then it will be required to nominate any person (natural) as its nominee for the purpose of the LLP. Any Person of sound mind The persons who are not declared as insolvent

Designated Partner : 

Designated Partner Every LLP should have minimum 2 designated partners who are individuals and atleast one of them should be resident in India. A person or nominee of a body corporate, intending to be appointed as who is appointed as designated partner of LLP should hold a Designated Partner Identification Number (DPIN) allotted by the Ministry of Corporate Affairs.(Sec.7(6) and Sec.266A to 266G of the companies act 1956 is applicable for this. DPIN can be obtained by submitting application along with address proof and identity proof of the individuals.

Reservation or Change of LLP name : 

Reservation or Change of LLP name Apply to registrar in form no.1(rule.18(5), sec.16(1)(a) for reservation of name- name will be reserved for 3 months from the date of intimation by the registrar.Sec.16(2) Apply to registrar in form no.1(Rule.18(5) for change of name sec.16(1)(b) and Sec.19.

Checking name availability and Reservation of name online : 

Checking name availability and Reservation of name online To check the availability of name go to LLP portal and click on check the name availability or follow this link given below. (can be checked without login) Any partner or designated partner in the proposed LLP may submit Form-1 for reservation of name Log on to the LLP portal www.llp.gov.in by entering username and password Click on E-Forms link Open Form No.1, fill up, Select name of the proposed LLP (upto 6 choices can be indicated),append digital signature Pay the necessary fee by credit card (master/visa). Check status of your application by logging on the portal. http://www.mca.gov.in/DCAPortalWeb/dca/MyMCALogin.do?method=setDefaultProperty&mode=16

Cessation of partner from LLP : 

Cessation of partner from LLP By agreement as mentioned sec.24(1) If no such agreement-Not less than 30 days notice to the other partners. Sec.24(1) By death sec.24(2)(a) Declared to be unsound mind by competent court sec.24(2)(b) If he becomes insolvent sec24(2)(c)

Liability of partners : 

Liability of partners Every partners are the agents of LLP. LLP is not bound by any act of the partners which the partner had no authority do particular act.Sec.27(1) The liabilities of LLp is met out of the property of LLP. Sec.27(4) A partner is not personally liable for the any act or omissions of other partner.

Assignment or transfer of partnership rights : 

Assignment or transfer of partnership rights The rights of partner to a share of profits and the losses of LLP and to receive distributions in accordance with the LLP agreement are transferable either wholly or in part. (Sec.42)

Winding up and Dissolution : 

Winding up and Dissolution By voluntary By tribunal (sec.63 to 65)

Jurisdiction of court : 

Jurisdiction of court JMFC or metropolitan magistrate will have the jurisdiction to try any offences under the act. Sec.77. Tribunal will have the powers as conferred under the act and appeals from tribunal lies to appellate tribunal and the provisions of sections 10FQ,10FZA, 10G,10GD, 10GE and 10GF of companies act is applicable in respect of such appeal.

Slide 18: 

Thank you