Change or Amendment of LLP Agreement
LLP (Limited Liability Partnership) is a Company where all partners have limited liabilities. Limited Liability Partnership (LLP) has a different legal status. Each partner is protected from their liability; also protected by the joint liability created by the other partner's wrong business decision or misconduct. Registration of LLP in India is ruled under the LLP Act, 2008, and a separate LLP Agreement has to be filed. Limited Liability Partnerships are required to be registered with the Registrar of Companies.
The existence of a Limited Liability Partnership doesn't solely depend on either of the partners. For instance, the demise of a Partner in Partnership Company may cause the Company to disintegrate, whereas, in Limited Liability Partnership, it may not cease to exist in such a case. The partners of LLP may keep changing from time to time & it will not affect the continuity of LLP.
The LLP Agreement is a common legal document that controls the Limited Liability Partnership and its overall operations. The partners must follow the terms of the Agreement & not violate any of them. By having a mutual agreement from the partners, the LLP Agreement can be changed at any time after the Registration. Changes in capital, activities, responsibilities & rights are among the most common reasons for Change. A complementary agreement is generally incorporated additionally with the actual Agreement to change the clauses. We at TAXAJ provide end-to-end solutions for filing Changes in LLP Agreements. Corpbiz is a legal consultancy firm providing comprehensive services concerning Changes in LLP Agreements.
Amendment of LLP Agreement for any changes.
Depends upon case to case basis
- Filing for Amendment of LLP Agreement for any changes.
- Business or Individual planning file for Amendment of LLP Agreement for any changes.
- Purchase of Plan
- Expert Assigned
- Share the details as requested
- Preparation of Form and Filing with MCA
Documents to be enclosed with Form 3
- Original LLP Agreement
- Modified LLP agreement
- Supplementary Deed
- Resolution regarding the changes to be made, which is passed in a Change in LLP Partners
- Any forms or documents required as proof
- Original LLP Agreement
- Modified LLP agreement
- Supplementary Deed
- Resolution regarding the changes to be made, which is passed in a Change in LLP Partners
- Any forms or documents required as proof
Documents to be enclosed with Form 4
- Consent of each of the partners
- An affidavit or other proof of a change in name
- Evidence of cessation
- If any of the partners is a company, the copy of the resolution in this regard
- Copy of authorisation/resolution mentioning the name & address of individuals(s) nominated as a representative of the partner/nominee
- Consent of each of the partners
- An affidavit or other proof of a change in name
- Evidence of cessation
- If any of the partners is a company, the copy of the resolution in this regard
- Copy of authorisation/resolution mentioning the name & address of individuals(s) nominated as a representative of the partner/nominee
What is a Limited Liability Partnership Agreement?
What is a Limited Liability Partnership Agreement?
A limited liability partnership (LLP) is a partner-based business that does not have common ownership or control of its assets. Instead, it is owned by all the partners, who take turns running the business based on how much money they contribute each year.
The LLP’s legal structure makes it an association rather than a corporation or a company. This means it does not have separate financial accounts, and business expenses are instead charged against the general partners’ shares. Instead, all business expenses are considered partner income and are therefore deductible for each partner.
Some Common Reasons for Making Changes in LLP Agreement
Some Common Reasons for Making Changes in LLP Agreement
The LLP Agreement is a charter of every limited liability partnership which defines the role, responsibilities, rights, and duties of all partners towards each other and towards the firm simultaneously. LLP Agreement is a mandatory document to get it registered with the concerned Registrar of Companies (“ROC”) in LLP e-Form – 3 and must be made on the relevant stamp paper (Appropriate value as per the state law) within 30 days of the formation of the LLP.
Some Most Common Changes that Occur in an LLP
Some Most Common Changes that Occur in an LLP
- Changes to the Agreement in general;
- Change in LLP Name;
- Changes to the LLP’s objectives;
- Change of LLP Registered Office within the jurisdiction of the ROC;
- Removal or resignation of an LLP Partner;
- Transmission of LLP rights in the vent of partner death;
- Shifting the registered Office or premise from one state to another state;
- Transmission of LLP rights in the case of partner death;
- Change in the LLP’s Profit & Loss Sharing Ratio;
- LLP sale to a completely new group of people.
Procedure to Make Changes in LLP Agreement
Procedure to Make Changes in LLP Agreement
Before making the Change in LLP Agreement, there are a few forms & steps to be followed:
- The 1st step is to arrange a meeting of the partners & taking the consent of each one involved in the Limited Liability Partnership. It is done by passing a Resolution for the partners;
- To fulfil the requirement of the appointment along with filing with the Ministry of Corporate Affairs (MCA), the authorisation is given to one of the Partners;
- After carrying out the above steps, further, the execution of the LLP Agreement is done by the payment of stamp duty;
- The requirement of Stamp Duty, Supplementary Deed & LLP Agreement validity;
- The Signature needs to be done by the partners;
- The attestation must be done by at least 2 witnesses.
Once all the above-mentioned steps are completed successfully, the further steps to alter the LLP Agreement are very easy to be completed. The steps are as follows:
- Passing a Resolution needs to be completed for revising the LLP Agreement.
- Once the resolution is passed within thirty days, Form-3 has to be filed with the Registrar.
Detailed Steps to Amend LLP Agreement
Agreement of the Limited Liability Partnership (LLP) is its charter, similar to Memorandum of Association and Articles of Association of a company. In the agreement, nature of business activities, rights, duties, and obligations of partners are mentioned.
Changing an LLP agreement is very easy.
Step 1– A resolution needs to be passed to revise the LLP agreement.
Step 2 – Form 3 is to be filed with the Registrar within 30 days of passing the resolution.
Details to be filled in Form 3
1. Date of modification in the agreement
2. Reason of change– whether the change is on account of:
- Change in business activities
- Change in partner(s)
- Change in partner’s contribution and percentage of profit sharing
- Change in any other relevant details like:
- Rights and duties of partners
- Restrictions on the authority of partners
- Management and administration of LLP
- Acts that can be done only with the consent of all the partners/ consent of a specific number or percentage of partners
- Procedure of calling, holding and conducting meetings
- Details of indemnity clause
- In relation to partner(s), details of agreement related to
- Admission
- Retirement
- Cessation
- Expulsion and
- Resignation
- Resolution of disputes between
- The partners
- The partner and the LLP
- Duration of the LLP
- Voluntary winding up
- Any other clauses related to the LLP agreement
3. Details of business activities after change 4. Main division of industrial activity as per NIC-2004 (based on changed business activities) 5. Details of partner’s contribution and profit sharing ratio after change in the LLP agreement
- Type of change (deletion/ change)
- Details of each partner (DPIN/ PAN), amount of contribution and percentage of profit sharing
- Total amount of contributions after the changes in the LLP agreement
Documents to be attached with Form 3
- Initial LLP agreement
- Changed LLP agreement
- Any other document(s)
Step 3 – File Form 4 for change in partner/ designated partner
If the change is due to change in partner(s)/ designated partner(s), Form 4 is also required to be filed along with Form 3.
In case of appointment, cessation, change in name/address/ designation of a designated partner or partner, Form 4 has to be filed.
In this form, details of all individuals and corporates being appointed as partner(s) and designated partner(s) have to be filled.
Documents to be attached with Form 4
- Consent of the partner
- Evidence of cessation
- Affidavit or any proof of change of name
- If the partner or a designated partner is a company, copy of resolution of the company to become partner in LLP
- Copy of resolution/authorization letter mentioning name and address of individual nominated as representative nominee/ partner.
Conclusion
After the LLP Agreement has been submitted and finished, further changes and additions can be made at any time after the online upload has been completed. Given the dynamic and ever-changing nature of the business industry and the firms, changes to the Agreement can be made at any moment by the company/individuals, and the process is also simple when you use the expertise of a lawyer from TAXAJ.
