IMITED LIABILITY PARTNERSHIP (LLP) IN INDIA
LLPs are an easy means of combining entrepreneurial talent and initiative with requisite capital and other resources, the professional expertise, and creative knowledge about the business concerned.
LLPs are mainly suitable for partnership concerns set up by Professionals.
The salient features of LLP are as under:
- LLP is a body corporate and a legal entity separate from its partners.
- LLP has a perpetual succession i.e., it can continue its existence even after the retirement, insanity, insolvency or even death of one or more partners.
- Separate Legal Entity- the liability of the partners is limited to their agreed contribution in the LLP which may be tangible or/and intangible in nature.
- LLP Agreement- The mutual rights and duties of all partners are governed by an agreement between them. Also, the partners shall have flexibility to devise the agreement as per their choice.
- No partner is liable for independent or un-authorized acts of other partners or their misconduct
- Every Limited Liability Partnership must have at least two partners and at least two individuals as designated partners, of whom at least 1 shall be resident in India.
- A LLP shall maintain annual accounts reflecting true and fair view of its state of affairs. A statement of accounts and solvency shall be filed by every LLP with the Registrar every year.
