LLP: Induction of New partner
What is the exact procedure for inducting a new partner in an LLP?
S. 25 of Limited Liability Partnership Act, 2008 (referred to as The Act herein), deals with the admission of new partner in an LLP. According to S. 25(1) of The Act, every partner shall inform the LLP of any change in his name or address within a period of fifteen days of such change; providing for the new partner to intimate the LLP of her/his intention to join. As per S.25(2)(b) of The Act, any change in the name or address of a partner requires filing of a notice with the Registrar within thirty days of such change; and S.25(3)(c) of The Act provides that if such notice filed with the Registrar relates to an incoming partner:
Generally, consent of all existing partners is essential for admission of a new partner, but if the LLP agreement explicitly provides a single partner with the power to act for all partners then consent of all partners is not essential.
Rule 22 of Limited Liability Partnership Rules, 2009 provides the procedure for inducting a new partner in an LLP:
After the filing of Form 4, the fact of new admission of partner is recorded by the Registrar and the inducting procedure of a new partner in an LLP is completed.
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Hi Akarsh !!
The procedure for inducting a new partner is very simple.
1. Consent of all existing partners needs to be obtained. But look out for the LLP Agreement, if it permits for one Partner has the authority to admit new Partners to the LLP without consent of all existing partners, then you can proceed in consonance with the Agreement.
2. New Partner must give intimation of his/her intent to join the LLP in FORM-6 of LLP Rules, 2009.
3. Upon admission/induction of the person as New Partner, the LLP has to file FORM-4 of LLP Rules, 2009 with Ministry of Corporate Affairs onwww.llp.gov.in., within 30 days of the admission of the New Partner.
4. LLP Form-3 must be signed by an existing Designated Partner.
5. You will be required to obtain a Certificate from a practising Company Secretary or Chartered Account to the effect that the CS/CA has verified all the details of the Partner added including the books and records of the LLP and found them to be correct.
6. Finally, an agreement for adding Partner must be executed as an addendum to the existing LLP Agreement.
If you need the format of the Agreement for adding partner, let me know. You can reach me out at firstname.lastname@example.org
Why not create one now for free in under 10 minutes!