New Delhi, India (PressExposure) June 02, 2009 -- LLP Formation Procedure-5 Simple Steps
Step I: Deciding the Partners & Designated Partners.
A LLP can be incorporated with a minimum of at least two partners who can be Individuals or Body Corporate through their nominees. Further for incorporating an LLP, of the total number no. of partners, at least two shall be Designated Partners, of which at least one must be an Indian Resident.
Step II: Obtaining DPIN & Digital Signatures.
Section 7 (6) of LLP Act 2008, provides that every Designated Partner to obtain a DPIN from the Central Government.
Every Designated Partner requires Digital Signature for being registered as Business user. The signatures shall also be required for signing and filing of all relevant forms and documents to be filed, annually or event based after incorporation of the LLP, asking for approvals or as intimation.
Step III: Checking Name Availability of LLP
The name of the limited liability partnership shall not be similar or identical with Company or LLP already registered in India and it should not contains words prohibited under the âEmblems and Names (Prevention of improper use) Act, 1950âor which are also not âUndesirableâ in the opinion of Central Government or which satisfies the conditions prescribed under rule 18(2). For more information check Name Availability Guidelines.
Step IV: Drafting of LLP Agreement
The next pertinent step is drafting of Limited Liability Partnership Agreement governing the mutual rights and duties among the partners and among the LLP and its partners containing the basic content in respect of Name of LLP, Name of Partners & Designated Partners , Form of contribution , Profit Sharing ratio , Rights & Duties of Partners , Proposed Business , Rules for governing the LLP.
In case no agreement is entered into, the rights & duties as prescribed under Schedule I to the LLP Act shall be applicable
Step V: Filing of Incorporation Documents
Next is the filing of Incorporation documents (e Form 2), consent of Partners (e Form 4), LLP Agreement (e Form 3) and declaration electronically through the medium of e-forms prescribed with the Registrar of Companies for incorporation of the LLP on payment of prescribed fees based on the total monetary value of contribution of partners in the proposed LLP.
Step VI: Certificate of Incorporation
After the Registrar is satisfied that all the formalities with respect to the incorporation has been complied, he will issue a Certificate of Incorporation as to formation of the LLP within maximum of 14 days from date of filing of documents. The Certificate of Incorporation issued shall be the conclusive evidence of formation of the LLP.
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