Procedure for forming a limited liability partnership in India In this blog, we have discussed about the procedure for forming a limited liability partnership (LLP) in India in a user friendly manner. Chiefly, LLP stands for limited liability partnership. The Parliament of India passed the Limited Liability Partnership Act in 2008 to govern LLP businesses in India. According to Section 2 of this law, an LLP is a partnership registered under the Act. Further, an LLP agreement refers to a written agreement between an LLP’s partners or between the LLP itself and its partners. This agreement defines the rights, liabilities, duties, and powers of the partners. The procedure for forming an LLP is very easy. Since the Limited Liability Partnership Act, 2008 specifically governs limited liability partnerships in India, the provisions of the Indian Partnership Act, 1932 are not applicable to LLPs. They only apply to traditional partnership firms. Benefits of LLP registration: The LLP can be restricted to raise fund from public by issuing securities or by debts. The LLP can get the funding by its partners or through the banks in the form of loans. The partners cannot take any actions without the consent of majority partners in the LLP. One partner should seek the approval of other partners for doing any activity. LLP doesn't have more creditability as compared to other companies. People always prefer these types of company for investing the money and running their business under the name of private limited company or public limited company. The LLP is easy to attract the investors and business expansion is easy compared to all other type of company. Procedure for the eligibility of LLP: PARTNERS: Minimum two designated partner is required to register the LLP. Both the partner should have Designated Partner Identification Number (DPIN). There is no maximum limit for the partners and designated partners, but every person who wants to become a designated partner in the LLP must have the DPIN. Both partners and designated partners can directly take part in the LLP, the LLP registration requires only the designated partners.
NAME: The name of the Limited liability partnership must have the word “LLP” at the end of the name. For example: “XYZ marketing LLP” here the XYZ denotes the name of the company and marketing signifies that the LLP is indulging in the business of marketing and LLP word shows the business format.
REGISTERED OFFICE: The LLP must have a registered office and it should mentioned in the LLP agreement. If any of the partner wants to change the registered office then firstly he should take the consent of all designated