Limited Liability Partnership (LLP) was introduced in India by way of the Limited Liability Partnership Act, 2008. The basic premise behind the introduction of Limited Liability Partnership (LLP) is to provide a form of business entity that is simple to maintain while providing limited liability to the owners. Since, its introduction in 2010, LLPs have been well received with over 1 lakhs registrations so far until September, 2014.
Steps to form a LLP
Step 1: Digital Signature Certificate (DSC) :
Before initiating the process of registration, we apply for the digital signature of the designated partners of the proposed LLP. This is because all the documents for LLP are filed online and are required to be digitally signed.
Step 2: Reservation of Name:
LLP-RUN (Limited Liability Partnership-Reserve Unique Name) is filed for the reservation of name of proposed LLP which shall be processed by the Central Registration Centre under Non-STP. But before suggesting the name to be applied, it is recommended that you use the free name search facility on MCA portal. The system will provide the list of closely resembling names of existing companies/LLPs based on the search criteria filled up. This will help you in choosing names not similar to already existing names.
The registrar will approve the name only if the name is not undesirable in the opinion of the Central Government and does not resemble any existing partnership firm or an LLP or a body corporate or a trademark. The form RUN-LLP has to be accompanied with fees as per Annexure ‘A’ which may be either approved/rejected by the registrar. A re-submission of the form shall be allowed to be made within 15 days for rectifying the defects. There is a provision to provide for 2 proposed names of the LLP.
Step 3: Incorporation of LLP:
The form used for incorporation is FiLLiP (Form for incorporation of Limited Liability Partnership) which shall be filed with the Registrar who has a jurisdiction over the state in which the registered office of the LLP is situated. The form will be an integrated form. Fees as per Annexure ‘A’ shall be paid. This form also provides for applying for allotment of DPIN, if an individual who is to be appointed as a designated partner does not have a DPIN or DIN. The application for allotment shall be allowed to be made by two individuals only. The application for reservation may be made through FiLLiP too. If the name that is applied for is approved, then this approved and reserved name shall be filled as the proposed name of the LLP
Step 4: Drafting of LLP Agreement: LLP agreement has to be drafted line with LLP Act. It is not mandatory to file LLP agreement at the time of registration and same can be file within 30 days. Designated partners are responsible for doing all acts, matters and things that are required to be done for complying with the provisions of the LLP act. They are liable to all penalties imposed on the LLP. So it is very important to draft LLP agreement with professional help.
Step 5: Filing of Form 3 - LLP Agreement:
The LLP agreement has to be uploaded. Once it gets approved all the formalities for registration gets completed.
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