A limited liability company (LLP) is a company in which some or all of the partners (depending on the jurisdiction) have limited liability. It can therefore have elements of partnerships and companies. In an LLP, each partner is not responsible for the misconduct or negligence of another partner. This is an important difference from the traditional partnership under the UK Partnership Act 1890, where each partner has joint and several (but not several) liability. In an LLP, some or all shareholders have a form of limited liability similar to that of shareholders of a corporation. Unlike corporate shareholders, shareholders have the right to directly manage the business.  In contrast, shareholders of corporations must elect a board of directors under the laws of various state charters.  The board of directors organizes itself (also under the laws of the various state charters) and hires senior executives, who, as “corporate” persons, then have the legal responsibility to run the company in the best interest of the company. An LLP also contains a tax liability other than that of a corporation. There are significant differences between the composition of PLLs in the US and those introduced in the UK under the Limited Liability Companies Act 2000 and adopted elsewhere. The UK LLP, despite its name, is expressly regulated by law as a corporation and not as a partnership. All deeds, contracts, plans, debentures, agreements, demands, instruments and agreements that existed immediately prior to the company`s registration as LLP are enforceable by or against LLP because LLP was named there or a party in place of the company. The limited liability company is governed by the Limited Liability Companies Act 2008, which came into force on 1 April 2008.
TheLP Act, 2008 has 81 sections and 4 schedules. So far, LLP Rules 2009 has required many forms to be submitted to MCA for a successful LLP agreement. A natural or legal person may become a partner in LLP. Arrangements have been made for the establishment of a branch by a foreign LLP. A foreign LLP must submit within 30 days of establishing a place of business in India to Registration Form 27 with a copy of the Certificate of Incorporation or Registration or any other document proving the incorporation of the LLP, the full address of the LLP`s registered office/registered office in the country of incorporation, the address of the principal place of business in India, the list of partners and designated partners, if any, as well as the names and addresses of two or more persons residing in India who have the right to accept the delivery of notices, documents, etc. Any changes to the above details must be indicated in the prescribed forms. If the documents are not available in English, the certified translation must also be submitted. A foreign LLP is also required to file a bank statement and creditworthiness each year. Foreign PLLs may be considered a corporation for income tax purposes. All designated LLP partners must receive a DPIN, which is a designated partner identification number. At the time of registration, the document must specify at least two persons as named partners.
In the absence of a specification, any partner whose name is first indicated in the partner statement in the declaration will be considered a designated partner. In the United States, Delaware Supreme Court Chief Justice Myron Steele suggested that limited liability companies should not be bound by common law standards of fiduciary principles (as applied to all other corporate and corporate structures). Instead, he argued that courts should use a contractual analysis of the partnership agreement when assessing cases of inappropriate corporate governance.  This led directly to the abolition of the “independent fiduciary duty of good faith” in Delaware corporate law in 2006.  There were various expert groups and committees in India, including the Abid Hussain Committee in 1997, the Naresh Chandra Committee on Audit and Corporate Governance in 2003, and Dr. J.J. In 2005, the Iranian Corporate Law Committee considered and recommended the need for a law allowing for the establishment of LLP. After considering all these recommendations, the Ministry of Corporate Affairs of the Government of India issued a discussion paper on limited partnership on 2 November 2005, stating that the LLP regime would provide a platform for small and medium-sized enterprises and professional firms of auditors, corporate secretaries, lawyers, etc. to conduct their business effectively, which would increase their global competitiveness. increase.
The LLP agreement does not even require written form, as simple partnership by-laws apply due to default provisions. It has been accurately reproduced by Japan, Dubai and Qatar. It is perhaps, by its very nature, the closest to a limited liability company in the United States of America, although it may differ from that entity in that, although the LLC has a legal existence independent of its members, it is not technically a corporation because its legal existence is limited in time and does not “persist”. In accordance with Article 76, the LLP, as well as such Designated Partner or Partner, shall be guilty and liable to prosecution if a criminal offence has been committed by a Partner or Designated Partner or is due to gross negligence on the part of a Partner or Designated Partner. There is often a list of professions approved for PLLs, such as lawyers, accountants, consultants, and architects. Liability protection also varies, but LPLs in most countries protect the partner from the negligence of another partner. Under the Limited Liability Companies Act 2008, at least two partners must be named “designated partners” in the incorporation document, who must be individuals. Although, if no person is specified, each LLP partner is considered a designated partner. Non-notification by the Partner of the change of name, address, etc. within 15 days of the change The partners of the audit firm share the profits, but do not have to bear the consequences of the negligence of the company or the other partners.
Not content with pressuring and funding political parties to achieve their ends, accounting firms have engaged entire governments to promote their interests. PricewaterhouseCoopers and Ernst & Young have asked the Jersey legislature to pass an LLP bill that they themselves had drafted. They protected themselves from lawsuits, with little public accountability. Accounting is of paramount importance for all calculations on institutionalized abuse, tax evasion and liability avoidance.  If the LLP is constituted for the period concerned, this period after which the LLP must be dissolved must be indicated. The LLP can also be formed for certain objects after the completion of such an object; the LLP must be closed. In the absence of a specific period or purpose, the duration of the LLP may include up to the period during which it is terminated with the consent of the LLP partners. The announcement of the partners and changes between them or the consent of the new partner to become a partner/designated partner LLP is necessary to keep appropriate accounting records, which can be done on a cash or periodic basis and in accordance with the dual accounting system.
The accounts show the financial situation, details of funds received and spent, records of assets and liabilities, cost of goods purchased, inventories, work in progress, finished products and the cost of acquiring goods sold. The books and records should allow the designated partner to ensure that the statement of account and solvency comply with the ACT. Each LLP is required to submit the statement of account and solvency within 30 days of the expiration of the six months of the fiscal year, i.e. no later than the 30th anniversary of the fiscal year. October, on Form 8. LLP degrees must be verified. However, an LLP whose turnover in a financial year does not exceed 40 lakhs or whose contribution (capital) does not exceed 25 lakhs is exempt from the provisions of the statutory audit. For the first year, the auditor may be appointed at any time before the end of the financial year. Thereafter, the auditor must be appointed at least 30 days before the end of the financial year. The appointed partners appoint the auditors.
If they do not, shareholders can appoint auditors. Arrangements have been made for the staffing of casual vacancies in the Office of auditors, the renewal of the mandate of auditors, the presumed renewal of the mandate of auditors and the dismissal of auditors. Unlike the company, there are no provisions in the ACT for the Registrar on the appointment of the auditor. An auditor may resign or express his or her rejection of a new appointment by means of a written notification. In both cases, he is required to attach to the notice a statement of the circumstances surrounding his resignation. Within 60 days of the end of the fiscal year, the LLP is required to file the annual statement on Form 11. .