LLP Partner Change

Who is Designated Partner in LLP?

Designated Partners are the individuals who manage the affairs of the limited liability partnership. They are similar to the directors of the company, however a basic difference between the two is that designated partners being contributed in the contribution of the LLP has the shares in the profit of the LLP. However in case of director, they are only entrusted to act and manage the affairs of the company by shareholders of the company and receive the remuneration from the company.

Who is Partner as per LLP Act, 2008?

Partner in relation to a LLP means any person designated as partner in the LLP as per the LLP agreement. A Partner must fulfil the conditions that he / she has to be of sound mind and must not be an undischarged insolvent.

Minimum Number of Designated Partners in LLP

As per the Limited Liability Partnership Act, 2008, every LLP shall have minimum two designated partner who are individual and one of them shall be a Resident in India.  However, in case of a LLP, having any or all designated partners as body corporates, then the nominee of the body corporate shall act as designated partners.

In case the number of designated partners falls below two in the LLP, and the LLP carries business for more than six months with one partner only, and the partner has the knowledge of the same, shall be liable personally for the obligation of the LLP incurred during the period.

Any individual of the age of 18 and above or Body Corporate can become designated partner in LLP. An individual shall not be capable of becoming partner of a LLP, if:

(a) he/she has been found to be of unsound mind by a Court of competent jurisdiction and the finding is in force;

(b) he/she is an undischarged insolvent; or

(c) he/she has applied to be adjudicated as an insolvent and his application is pending.

The appointment, resignation and change in designation of designated partner and partner in LLP is governed by the LLP Agreements executed amongst the partners of the LLP and LLP Act. For becoming a designated partner in LLP, Designated Partnership Identification Number (DPIN) is mandatory. However, in case of appointment of partner in LLP, DPIN is not mandatory.

Appointment of designated partner and/partner:

• For appointment of designated partner and partner in LLP one has to check the LLP Agreement.
• Obtain class III DSC, in case DPIN is also to be applied as well.
• Application for DPIN in form DIR-3, for appointment of partner DPIN is not mandatory
• Obtain the consent of the individual/nominee in form 9
• Obtained resolution from body corporate, in case a body corporate to be appointed as partner
• Draft supplementary LLP agreement and execute the same on the appropriate value of stamp paper
• Filing of form LLP-3 and LLP-4 with the Registrar of Companies

The fees to be paid on filing of form depends on the amount of contribution.

The value of stamp duty is to be paid on the agreement depends on the contribution of the LLP and the state in which the registered office address of the LLP is situated.

Resignation of designated partner and/partner:

• For resignation of designated partner and partner in LLP one has to check the LLP Agreement.
• Obtain class III DSC, in case the DSC of all the individual designated has expired.
• Obtain the resignation letter in form LLP-13
• Obtain a resolution in case the resigning partner is a body corporate
• Draft supplementary LLP agreement and execute the same on the appropriate value of stamp paper
• Filing of form LLP-3 and LLP-4 with the Registrar of Companies

The fees to be paid on filing of form depends on the amount of contribution.

The value of stamp duty is to be paid on the agreement depends on the contribution of the LLP and the state in which the registered office address of the LLP is situated.

Change in designation of designated partner and/partner:

• For change in designation of designated partner and partner in LLP one has to check the LLP Agreement.
• In case the designated partner/partner is body corporate obtain a copy of resolution
• Draft supplementary LLP agreement and execute the same on the appropriate value of stamp paper
• Filing of form LLP-4 with the Registrar of Companies

The fees to be paid on filing of form depends on the amount of contribution.

The value of stamp duty is to be paid on the agreement depends on the contribution of the LLP and the state in which the registered office address of the LLP is situated.