What is Limited Liability Partnership?

The (LLP) Limited Liability Partnership can be said to be the upgraded version of Partnership. The Limited Liability Partnership Act 2008 was published in the official Gazette of India on 7 January 2009 and has been notified with effect from 31 March 2009.

A Limited Liability Partnership (LLP) can be defined as the partnership in which some or all partners are having limited liabilities and they carry on the business for a common objective.

LLP is mainly suitable for all those who are engaged in providing consultancy service. Partnerships (LLP), along with the private and public limited corporations. It is the hybrid form which incorporates benefits of both partnership and companies.

The most distinguishing feature of an LLP is that it limits the liability of its partner for the errors, omissions, incompetence, or negligence of the LLP’s employees or other agents.

Formation of LLP/ Process:

  1. A minimum of two partners will be required for formation of an LLP (one of them must be a resident of India).
  2. There is no restriction on the maximum number of partners
  3. Any Individual or Body Corporate may be a partner of Limited Liability Partnership.
  4. Every Partner of the LLP is, for the purpose of the business of LLP, the agent of the LLP, but not of the other partner.
Registered Office:

Each Limited Liability Partnership (LLP) shall have a registered office where all Notices may be communicated.

Simplified Procedure:

1. Obtain DIN (If already there then Ignore)

2. Obtain DSC (If already there then Ignore)

3. Search for Name Availability for LLP formation name.
4. File Form 1 – Rule 18(5): Reservation of name:
Reservation of name shall be filed. Partners shall have to select the name of the proposed LLP.

5. File Form 2 for incorporation and subscription Document have to be filed with ROC after the name is reserved for LLP by Registrar.

6. File Form 3 for LLP Agreement: It is not compulsory to file LLP agreement at the time of registration of the LLP but the LLP agreement it is to be mandatorily filed within 30 days of Incorporation of LLP in Form -3.

List of Forms for Incorporation:

Forms to be Filed by Limited Liability Partnership (LLP) on Incorporation:

Application for reservation or change of name

Filing documents necessary for incorporation

Provide the Detailed information about designated partners

Information with regard to Limited Liability Partnership agreement and changes, if any

 Form 1

 Form 2

 Form 2A

   Form 3

Note: Stamp Duty need to be paid where necessary as per stamp Act.

Penalty: For non-Compliance, the penalty charged to LLP is 100 Rs. Per day.