How to Incorporate a Limited Liability Partnership in India?

LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners.

Following is the process to get registered your business as a Limited liability Parnership.

Step 1 : User Registration

• Register yourself on the website of Ministry of Corporate Affairs, developed for LLP services, i.e. www.llp.gov.in. This website may also be accessed through the website of the ministry www.mca.gov.in On the home page of the URL www.llp.gov.in click “Register” tab on top right hand corner of the page
• Fill in the registration form. Fields marked * in the form are to be mandatorily filled. Select your user name and password.
• Upload digital signature certificate
• On successful registration, system will give a message that you have been registered successfully.

Step 2 : Obtain Designated Partners Identification Number (DPIN).

• All designated partners of the proposed LLP shall obtain “Designated Partner Identification Number (DPIN) / Director Identification Number (DIN)”.
• DPIN/DIN may be applied from: http://www.mca.gov.in/MCA21/ Din.html

Step 3 : Digital Signature Certificate

• Partner/Designated partner of LLP/proposed LLP, whose signatures are to be affixed on the e-forms has to obtain class 2 or class 3 Digital Signature Certificate (DSC) from any authorized certifying agency, details of which are available on the home page of the LLP portal under the tab “Certifying Authorities”.

Step 4 : Reservation of Name

• Log on to the LLP portal by clicking the “log in” tab on the top right corner of the homepage and enter your username and password. After login, click “E-Forms” link.
• Open Form-1 for reservation of name and fill in the details. Select name of the proposed LLP (upto 6 choices can be indicated).
• Any partner or designated partner in the proposed LLP may submit Form-1.
• Append digital signatures and submit the e-form
• Pay the necessary fee by credit card (master/visa).
• Free name search facility (of existing companies / LLPs) is available on MCA portal (hyper link available on LLP portal). The system will provide the list of similar/closely resembling names of existing companies/LLPs based on the search criteria filled up.
• Details of minimum two designated partners of the proposed LLP, one of them must be a resident of India, is required to be filled in the application for reservation of name. Only individuals or nominees on behalf of the bodies corporate as partners can act as designated partners.
• Check status of your application by logging on the portal.

Step 5 : Incorporation of LLP

• Once the name is reserved by the Registrar, log on to the portal and fill up Form-2 “Incorporation Document and Statement”.
• Pay the prescribed registration fee as per the slab given in Annexure A of the LLP Rules, 2009, based on the total monetary value of contribution of partners in the proposed LLP.
• Statement in the e-form is to be digitally signed by a person named in the incorporation document as a designated partner having permanent DPIN and also to be digitally signed by an advocate/company secretary/chartered accountant/cost accountant in practice and engaged in the formation of LLP.
• On submission of complete documents the Registrar after satisfying himself about compliance with relevant provisions of the LLP Act will register the LLP, maximum within 14 days of filing of Form-2 and will issue a certificate of incorporation in Form-16.
• You can check status of your application by logging on to the portal

Step 6 : Filing of LLP agreement (Form-3) and Partners’ details (Form-4)

• Once the name is reserved by the Registrar, log on to the portal and fill up Form-2 “Incorporation Document and Statement”.
• Form 3 (Information with regard to LLP agreement and changes, if any made therein) and Form-4 (Notice of Appointment of Partner/ Designate Partner, his consent etc.) may be filed with the prescribed fee simultaneously at the time of filing Form-2 or within 30 days of the date of incorporation or within 30 days of such subsequent changes.


DOCUMENTS REQUIRED FOR LIMITED LIABILITY PARTNERSHIP REGISTRATION

• ID and Address Proof of Partners like Pan Card/Passport/Voter ID/Aadhar Card/Driving License Copy of the Partners.
• One Business Place Address proof like Electricity Bills or any other Address Proof



ADVANTAGES/BENEFITS OF LIMITED LIABILITY PARNERSHIP

Limited Liability :
In case of LLP partners are not personally liable for the debt and obligation of the partnership. It means that their personal assets are protected in case the business runs into financial trouble

Separate Legal Entity :
The LLP is a different legal entity from its partners, with its rights and obligations. The LLP can now enter into agreements, hold property, and bring or receive legal action in its name.

Flexibility in Management and Operations :
LLPs are exempt from stringent statutory obligations, in contrast to other commercial entities. Partners are allowed to mutually agree upon how they want to divide profits and define their respective roles and responsibilities. This makes it possible to create a management structure that is tailored to the needs and preferences of the partners and is flexible.

Easy Transfer of Ownership :
LLP registration makes the transfer of ownership easy. Following the steps stated in the partnership agreement, partners in an LLP can transfer their ownership interests to others in whole or in part.