29 August 2021
There is a LLP having 2 partners. There capital contribution is Rs 50000 each. Now one partner want to retire and 4 another partner join the LLP. And also some business activity has to added (Business activity code remain the same, only some extra business object has to added in the same business activity code ) Also new partner brought some capital . Suppose each partner want to contribute Rs 200000. Now I summarise the changes :- 1. Retirement of a partner 2. Admission of 4 new partner 3. Some addition in business object with same business activity code
Now I want to know the step by step procedure for this change. Which form to be used and whether supplementary LLP agreement required or new LLP agreement required. Please resolve my problem.
06 July 2024
To make the changes you've outlined in your LLP (Limited Liability Partnership), here's a step-by-step procedure along with the necessary forms and considerations:
### Step-by-Step Procedure:
1. **Retirement of Partner:** - The retiring partner needs to give a notice of retirement to the LLP. - The LLP Agreement typically outlines the procedure for retirement, including settlement of accounts and transfer of rights. - Obtain consent from other partners regarding the retirement.
2. **Admission of New Partners:** - The LLP Agreement must be checked to see if it allows for admission of new partners and the procedure for doing so. - Obtain consent from existing partners for admission of new partners. - New partners should contribute their capital as per the agreed terms.
3. **Amendment of LLP Agreement:** - Determine if the changes (retirement, admission of new partners, addition of business activities) require an amendment to the LLP Agreement. - If significant changes are needed (like adding new business activities), it's advisable to amend the LLP Agreement rather than supplementing it.
4. **Filing with ROC (Registrar of Companies):** - Prepare and file Form 4 with the ROC for changes in LLP partners (retirement and admission). - Prepare and file Form 3 for changes in LLP Agreement (if applicable). - File Form 17 (if necessary) for the addition of business activities.
5. **Documents Required:** - Resolution passed by partners for retirement and admission of new partners. - New LLP Agreement or amended LLP Agreement, as applicable. - Consent letters from retiring and new partners. - Form DIR-12 for cessation of retiring partner (if applicable).
### Forms Required:
- **Form 4:** For changes in partners (retirement and admission). - **Form 3:** For changes in LLP Agreement (if applicable). - **Form 17:** For addition of business activities under the same business activity code.
### Supplementary LLP Agreement vs. New LLP Agreement:
- **Supplementary LLP Agreement:** Typically used when there are minor amendments or additions to the existing LLP Agreement. - **New LLP Agreement:** Recommended when there are substantial changes, such as adding new business activities or significantly altering partner rights and obligations.
### Additional Considerations:
- Ensure all filings are completed within the prescribed timelines to avoid penalties. - Verify with a legal professional or a company secretary to ensure compliance with LLP rules and regulations. - Maintain records of all resolutions, agreements, and filings for future reference and compliance audits.
By following these steps and completing the necessary forms, you can effectively make the changes in your LLP, including partner retirement, admission of new partners, and addition of business activities. If in doubt, consulting with a professional familiar with LLP regulations can ensure smooth execution of these changes.
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