Change of Designated Partners in LLP

Overview

LLP has gained a lot of popularity during the present times as it has lesser compliances involved and lesser maintenance costs. Any designated partner can resign from the LLP provided the total number of DP in LLP shall not fall below the minimum criteria of 2. LLP is incorporated with a minimum of two designated partners. However, there is no limit specified under the law on the maximum number of partners in LLP. It is to be noted that at least one DP must be resident of India which means an NRI can also be appointed as a Designated Partner in LLP.

The Task of Designated Partner

A designated partner is a partner like a managing director in the event of the organization. He is one of the partners of the LLP who deals with everyday activities, compliances and dealings of the LLP. A Limited Liability Partnership is controlled by its partners. From its administration to the activity, the partners direct the LLP towards its objectives and vision. New partners are included or existing leave; it doesn't influence the status of the LLP, yet without a doubt impacts the development of the business and obligations of different partners.

Admission, Cessation and Change in Designated Partners

An individual can be admitting to appoint a partner to the LLP with the assent of different partners of the LLP and as per the arrangements of Limited Liability Partnership Act, 2008. In a similar way, Cessation of Partner and Change in Designated Partners occur, Form 3 is required to be recorded. The rights and commitments of the admitted partner shall be determined via agreement entered with other partners into the LLP.

Documents required

The following documents are required for change of designated partner,

• Passport size photograph
• PAN Card
• Aadhar Card
• Driving License/ Voter ID Card/ Passport
• Email Id
• Contact Number

Further documents required to be furnished while changing the designated partners

• Notice of Resignation/Removal (when applicable)
• Consent to go about as Partner/Designated Partner (when applicable)
• Resolution
• Original LLP Agreement and
• Supplement Deed to LLP Agreement

Procedure

• First of all, the person who wants to get appointed shall obtain Digital Signature Certificate.
• Then an application for allotment of DIN shall be made by filing form DIR-3.
• Supplemental Deed will be drafted for the incoming designated partner as well as an outgoing designated partner.
• Get the deed duly signed and stamped on a non-judicial stamp paper of appropriate value.
• Consent will be obtained from the incoming DP in Form-9.
• Resignation letter from the outgoing DP will be obtained.
• Form 3 and Form 4 will be filed to the registrar within 30 days from the date of execution of the supplemental deed.

It may be noted that the Resignation of Designated Partner is different from the Removal of Designation Partner.

There are circumstances under which Designated Partner will automatically be removed from the LLP which are discussed as below,

• In case of death of the DP.
• If the Designated Partner is declared to be the person of unsound mind.
• If the Designated Partner is adjudicated as an insolvent or declared as an insolvent.

The need for a change of partners

• Proficiency with extra capital
• Change in terms of Partnership
• The inability of the current Partner
• The numeral of designated partners is below the legislative boundary

Conclusion

Nowadays, it’s being seen that LLP has become the most popular form of business organization with its advantageous nature just as the absence of compliances. The procedure for changes in partners for LLP alongside drafting of agreement with important changes will be followed in a well agreeable way which requires the consultancy with the Professional. Here Neusource controls you in the business foundation and that still any confusion continues, at that point you can reach us.

For more information contact us on given communication details,

Email Id Swati@neusourcestartup.com and Phone Number 9540026175.

The NeuSource Startup Mind is the finest business startup consultant that offers various services of registration like Proprietorship Firm Registration, Partnership Firm Registration, LLP Registration, Company registration, GST Registration, Copyright Registration, ISO Registration Trademark registration and other FSSAI License etc.

CS Vaishali Verma

Ideas are easy but Implementation is hard. If you're seriously passionate about something and you work hard, then I think you will be successful. Neusource helps you to make your start up successful.