Limited liability Partnership

SMCLLP Act, 2008 was started by the Parliament of India to introduce and legally concept of LLP in India. Unlike the general partnerships in India, LLP is a corporate and legal entity separate from its partners. LLP is a corporate business firm that enables professional expertise and entrepreneurial initiative to combine and operate in flexible, as a hybrid of companies & partnerships providing benefits of limited liability. Separate Legal Entity- Continue its existence irrespective of changes in partners,

  • * LLP itself can enter into contracts,
  • * Partners’ Liability as per the contribution,

Partner: Partner means any person who becomes a partner in the LLP as per the LLP agreement. Financial Year: The period from the 1st day of April of a year to the 31st day of March of every year. In the case of a LLP incorporated after the 30th day of September of a year. LLP Agreement

Any written agreement between the partners of the LLP which determines the mutual rights and duties of all the partners and their rights and duties in relation to that LLP. It is not necessary to enter into an LLP agreement as per LLP Act, 2008

Minimum number of partners

Every LLP shall have at least two designated partners who are individuals and atleast one of them shall be resident in India. If at any time the number of partners of a LLP is reduced below two and the LLP carries on business for more than six months, the person, who is the only partner of the LLP carries on business after those six months shall be liable personally for the obligations of the LLP incurred during that period.

Designated Partner

Every limited liability partnership shall have at least two designated partners who are individuals and at least one of them shall be a resident in India. In case if no partner is designated or if at any time there is only one designated partner, each partner shall be deemed to be a designated partner of the LLP. In case of a limited liability partnership in which all the partners are bodies corporate or in which one or more partners are individuals and bodies corporate, at least two individuals who are partners of such limited liability partnership or nominees of such bodies corporate shall act as designated partners.

Accounts and Audit

LLP is required to maintain books of accounts for each year on cash basi.. Accounts shall be audited by Auditors appointed by the Authorized Person. Audit of accounts is compulsory if turnover exceeds Rs. 40 lakhs.