What is Limited Liability Partnership?
LLP is a kind of business entity which brings together the advantages of both partnership & company where one partner is not responsible for other partners’ negligence or misconduct. Each partner has limited liability towards the organization. No one is personally liable to pay out of their personal property for any liability that arises towards the organization.
Every LLP shall have a least two designated partners, a least one of which must be resident in India. To add a new partner to existing LLP consent of all partners is required. However, if the LLP agreement allows that one partner can add new partner without the consent of other partners, then the consent of all partners is not required.
Documents Required for Appointment of Designated Partner to LLP
Document for Appointment of designated partner to LLP:
- Copy of Aadhar card of proposed designated partner.
- Copy of PAN Card.
- Passport sized photograph.
- Scanned copy of signature.
- Existing LLP Agreement.
Procedure for Appointment of Designated Partner to LLP
- A designated partner can be Appointment to an existing LLP with the consent of all existing partners of LLP as per the provisions of section 25 of LLP Act, 2008.
- Liabilities of proposed designated partner Rights and liabilities of proposed designated partner will be decided to vide the LLP agreement entered by the existing partners of the LLP.
- Existing partners After getting the consent of existing partners for admission of a proposed designated partner in a duly convened meeting a supplementary LLP Agreement needs to be drafted and filed with Registrar of Companies.
- Consent of proposed designated partner is also required to be obtained from him/her in the prescribed form.
- After the appointment, it is required by the LLP to intimate concerned Registrar of companies about the change in E-Form LLP-4 after getting it certified by practicing CA/CS/CMA within 30 days of appointment.
- Supplementary LLP Agreement is also required to be filed with the concerned Registrar of Companies in E-Form LLP-3, within 30 days of the appointment of designated partner.
Frequently Asked Questions
The term “Designated Partner” denotes a person who is responsible for taking care of day to day activities, compliances, operations, and dealing of the LLP.
Only a natural person is eligible to become a Designated Partner in a Limited Liability Partnership.
The ones who are not eligible to become a Designated Partner are Undischarged Insolvent, Minor, a person who has been sentenced imprisonment for involvement in Immoral Acts, who has held the payment of creditors, etc.
The steps included are Apply for DSC and DIN, Pass necessary Resolution, and the Inclusion of name in the LLP Agreement.
The main role of a Designated Director is to affix his/ her signature on the Statement of Account and Solvency, file Annual Returns with the ROC, file necessary documents and details for Inspection, and reimburse expenses.
A minimum of 2 designated partners are required to start an LLP or Limited Liability Partnership in India.
The documents required for the Appointment of the Designated Partner are a copy of the Aadhar Card, PAN Card, Passport-sized Photograph, DSC (Digital Signature Certificate), and existing LLP Agreement.
A minimum of Rs 10000 will be levied as penalty for the non-appointment of Designated Partner in an LLP.
Usually, a period of 4 days is required for obtaining the approval for the appointment of Designated Partner in an LLP.
An LLP needs to file Form 4 with the Registrar for the appointment of director.
No, a minor cannot become a Designated Partner in an LLP.
Yes, it is mandatory for a proposed designated partner to provide a LOC (Letter of Consent) in form 9 to other designated partners.
Swarit Advisors have a team of 300+ experienced professionals, who work to provide end-to-end legal assistance to cater their client needs.
A person should have a minimum age of 18 years to become a Designated Partner in an LLP.
No, a Bankrupt person cannot apply for becoming a Designated Partner in an LLP.
Yes, the Designated Partners of a Limited Liability Partnership are similar to the Directors of a Company.