Limited Liability Partnership Law and Practice

 Limited Liability Partnership: Law & Practice is a comprehensive commentary on the law of and rules for setting up and regulate limited liability partnership in India—the Limited Liability Partnership Act 2008 (Act No 6 of 2009). The book provides a section by section explanation and comments on statutory provisions of the LLP Act 2008 and practice hints for professionals. The book has been structured in four parts for easy reference and access to content.  Part I explains the LLP Act at a glance and reference tables for forms to be used, comparison of LLP with firms and companies and penalties under the LLP Act. Part II provides an overview of LLPs in India and foreign countries. Part III gives a section-wise commentary of the LLP Act, 2008 divided into 14 well written chapters along with relevant rules etc. Part IV gives the text of the LLP Rules, Forms, relevant provisions of other Acts, extracts from expert committee reports, fees, etc. Detailed commentary on the statutory provisions has been provided. The chapters are based on the scheme of the LLP Act. Rules and Forms are explained along with relevant sections for ease of reference. Foreign LLPs are explained separately. The commentary includes explanation of similar provisions of the Companies Act 1956. Cross references to other provisions of LLP Act, Companies Act and Partnership Act, etc, have also been given. Practice hints for filling forms and secretarial compliances have been provided. Indian and foreign decided case laws in the subject are included to support the commentary. Reference has also been made to similar provisions in foreign Acts.  This is a user-friendly book authored by subject experts, keeping in mind professionals and LLPs.

Contents
Preface ................................................................................................vii
Acronyms for Reference and Terms Used in the Book .................... xi
Table of Contents..............................................................................xiii
Table of Cases ................................................................................ xxxi
PART I
REFERENCER
CHAPTER 1
Scheme of Limited Liability Partnership
Act 2008 (LLP Act)
At a Glance
Ministry of Corporate Affairs Notification ...................................... 7
LLP Rules ................................................................................................ 7
Limited Liability Partnership Rules 2009 ......................................... 8
Concept Limited Liability Partnership (Winding up and
Dissolution) Rules 200_ .......................................................... 9
Other Applicable Acts .......................................................................10
Table 1—Forms to be Used by Limited Liability
Partnerships (LLPs) ...............................................................11
Table 2—Penalties and Punishments Under LLP Act 2008 .......15
Table 3—Comparison of Partnership/Firm and Limited
Liability Partnership (LLP) ...................................................21
Comparison Of Limited Company And Limited Liability
Partnership ..............................................................................26

PART II
INTRODUCTION
CHAPTER 1
Limited Liability Partnership—An
Overview
1.1 Introduction ............................................................................35
1.2 Types Of Business Organisation .........................................36
1.2.1 Sole Proprietorship Firm ..........................................36
1.2.2 Partnership Firm .......................................................36
1.3 Cooperative Society ...............................................................38
1.4 Company .................................................................................38
1.5 Genesis Of Limited Liability Partnerships Abroad
And In India ...........................................................................42
1.6 Limited Liability Partnership Concept...............................45
1.7 Limited Liability Partnership Defined And Explained ...46
1.8 Committee Recommendations ............................................51
1.8.1 Naresh Chandra Committee ..................................51
1.8.2 JJ Irani Committee ....................................................52
1.8.3 Distinction between Recommendations of the
Naresh Chandra Committee and Dr JJ Irani
Committee on Concept of Limited Liability
Partnership .................................................................54
1.9 Objectives Of And Reasons For Having Limited
Liability Partnership In India ..............................................54
1.10 Regulatory Framework Of Limited Liability
Partnerships In India.............................................................57
1.11 Salient Features Of The Limited Liability Partnership
Bill 2008 (Now Act) ...............................................................59
1.12 Salient Features Of The Limited Liability Partnership
Act In India .............................................................................60
1.13 Advantages Of Limited Liability Partnerships .................63
1.14 Disadvantages Of Limited Liability Partnerships ............65
1.15 Taxation Of Limited Liability Partnerships ......................65
1.16 Conclusion...............................................................................67

CHAPTER 2
Limited Liability Partnership:
International Perspective
2.1 Introduction ............................................................................69
2.2 Limited Partnerships .............................................................70
2.3 Limited Liability Partnerships Across The Globe .............71
2.3.1 Limited Liability Partnership in the
United States ..............................................................71
2.3.2 Limited Liability Partnership in Canada ..............74
2.3.3 Limited Liability Partnership in China .................75
2.3.4 Limited Liability Partnership in Japan .................76
2.3.5 Limited Liability Partnership in United
Kingdom .....................................................................77
2.3.6 Limited Liability Partnership in Singapore ..........81
2.4 Comparative Position Of Limited Liability
Partnerships ............................................................................89
PART III
COMMENTARY ON STATUTORY
PROVISIONS OF THE LIMITED
LIABILITY PARTNERSHIP
ACT 2008
CHAPTER 1
Jurisdiction, Commencement and Definitions
1.1 Scope Of The Chapter ...........................................................93
1.2 Section 1 ...................................................................................93
1.2.1 Objective .....................................................................94
1.2.2 Commentary ..............................................................94
1.3 Section 2 ...................................................................................95
1.3.1 Objective .....................................................................98
1.3.2 Commentary ..............................................................98

CHAPTER 2
Nature of Limited Liability Partnership
2.1 Scope Of The Chapter ........................................................ 119
2.2 Section 3 ................................................................................ 120
2.2.1 Objective .................................................................. 120
2.2.2 Commentary ........................................................... 120
2.3 Section 4 ................................................................................ 126
2.3.1 Objective .................................................................. 126
2.3.2 Commentary ........................................................... 127
2.4 Section 5 ................................................................................ 128
2.4.1 Objective .................................................................. 128
2.4.2 Commentary ........................................................... 128
2.5 Section 6 ................................................................................ 130
2.5.1 Objective .................................................................. 130
2.5.2 Commentary ........................................................... 131
2.6 Section 7 ................................................................................ 131
2.6.1 Objective .................................................................. 133
2.6.2 Commentary ........................................................... 133
2.7 Section 8 ................................................................................ 139
2.7.1 Objective .................................................................. 139
2.7.2 Commentary ........................................................... 139
2.8 Section 9 ................................................................................ 141
2.8.1 Objective .................................................................. 141
2.8.2 Commentary ........................................................... 142
2.9 Section 10 ............................................................................. 142
2.9.1 Objective .................................................................. 143
2.9.2 Commentary ........................................................... 143
2.10 Similar Provisions Under The Foreign Law ................... 144
2.11 LLP Rules 2009 —Rules—7, 8, 9 and 10 ........................ 145
2.11.1 Text of the Rules—Chapter II of the LLP
Rules —Rules 7, 8 and 9 ....................................... 145
2.11.2 Text of the Rules—Chapter III of the LLP
Rules—Rule 10 ....................................................... 146
2.11.3 Commentary on Rule 10 and Relevant
Forms ........................................................................ 148
2.12 Forms To Be Used For Section 7 Read With
Rules 7, 8, 9 and 10 ............................................................. 153
2.13 Prescribed Fee ...................................................................... 153
2.14 Penalty .................................................................................. 154
2.15 Cross References ................................................................. 154
CHAPTER 3
Incorporation of Limited Liability Partnership
3.1 Scope Of The Chapter ........................................................ 157
3.2 Section 11 ............................................................................. 158
3.2.1 Objective .................................................................. 159
3.2.2 Commentary ........................................................... 160
3.3 Section 12 ............................................................................. 163
3.3.1 Objective .................................................................. 164
3.3.2 Commentary ........................................................... 164
3.4 Section 13 ............................................................................. 166
3.4.1 Objective .................................................................. 167
3.4.2 Commentary ........................................................... 167
3.5 Section 14 ............................................................................. 171
3.5.1 Objective .................................................................. 171
3.5.2 Commentary ........................................................... 171
3.6 Section 15 ............................................................................. 174
3.6.1 Objective .................................................................. 174
3.6.2 Commentary ........................................................... 174
3.7 Section 16 ............................................................................. 181
3.7.1 Objective .................................................................. 181
3.7.2 Commentary ........................................................... 181
3.8 Section 17 ............................................................................. 183
3.8.1 Objective .................................................................. 184
3.8.2 Commentary ........................................................... 184
3.9 Section 18 ............................................................................. 185
3.9.1 Objective .................................................................. 185
3.9.2 Commentary ........................................................... 186
3.10 Section 19 ............................................................................. 187
3.10.1 Objective .................................................................. 187
3.10.2 Commentary ........................................................... 187
3.11 Section 20 ............................................................................. 188
3.11.1 Objective .................................................................. 188
3.11.2 Commentary ........................................................... 188
3.12 Section 21 ............................................................................. 189
3.12.1 Objective .................................................................. 189
3.12.2 Commentary ........................................................... 190
3.13 Similar Provisions Under The Foreign Law ................... 192
3.14 LLP Rules 2009 – Rules 11 to 20 ...................................... 192
3.14.1 Text of the Rules 11 to 20 ..................................... 192
3.14.2 Commentary on Rules 11 to 20 and
Relevant Forms ....................................................... 192
3.15 Prescribed Forms ................................................................. 204
3.16 Prescribed Fee ...................................................................... 204
3.17 Penalty .................................................................................. 205
3.18 Cross References ................................................................. 206
The Limited Liability Partnership Act 2008................... 206
The Companies Act 1956 .................................................. 206
Annexure 3.1—Rules–11 to 20 of the LLP Rules, 2009 207
Annexure 3.2—The Schedule of Undesirable Names
Specified Under Sections 2 (a) and 3 of the Emblems
and Names (Prevention of Improper Use) Act 1950.... 213
Annexure 3.3—Company Affairs Circular No 6/99
Dated 13th May, 1999 issued by the Government
of India, Department of Company Affairs (File
No.5/35/98-CL. V) ............................................................ 216
Annexure 3.4—How to Obtain a Digital Signature
Certificate ............................................................................. 219
Annexure 3.5—Guidelines to draft an LLP
Agreement ............................................................................ 220
Annexure 3.6—Schedule I to LLP Act, 2008 ................. 221
Annexure 3.7—How to Incorporate a New Limited
Liability Partnership ........................................................... 222
Annexure 3.8—Form 1 ...................................................... 225
CHAPTER 4
Partners and Their Relations
4.1 Scope Of The Chapter ........................................................ 239
4.2 Section 22 ............................................................................. 240
4.2.1 Objective .................................................................. 240
4.2.2 Commentary ........................................................... 240
4.3 Section 23 ............................................................................. 241
4.3.1 Objective .................................................................. 242
4.3.2 Commentary ........................................................... 242
4.4 Section 24 ............................................................................. 245
4.4.1 Objective .................................................................. 247
4.4.2 Commentary ........................................................... 247
4.5 Section 25 ............................................................................. 251
4.5.1 Objective .................................................................. 252
4.5.2 Commentary ........................................................... 252
4.6 Similar Provisions under the Foreign Law ..................... 253
4.7 LLP Rules 2009 — Rules 21 and 22 ................................. 254
4.7.1 Text of Rules 21 And 22 ....................................... 254
4.7.2 Commentary on Rules 21 and 22 and the
Relevant Forms ....................................................... 255
4.8 Prescribed Forms ................................................................. 260
4.9 Prescribed Fee ...................................................................... 261
4.10 Penalty .................................................................................. 261
4.11 Cross References ................................................................. 261
The Companies Act 1956 .................................................. 261
The Partnership Act 1932 ................................................. 262
CHAPTER 5
Extent and Limitation of Liability of Limited
Liability Partnership and Partners
5.1 Scope Of The Chapter ........................................................ 263
5.2 Section 26 ............................................................................. 264
5.2.1 Objective .................................................................. 264
5.2.2 Commentary ........................................................... 264
5.3 Section 27 ............................................................................. 266
5.3.1 Objective .................................................................. 266
5.3.2 Commentary ........................................................... 266
5.4 Section 28 ............................................................................. 272
5.4.1 Objective .................................................................. 272
5.4.2 Commentary ........................................................... 272
5.5 Section 29 ............................................................................. 274
5.5.1 Objective .................................................................. 275
5.5.2 Commentary ........................................................... 275
5.6 Section 30 ............................................................................. 276
5.6.1 Objective .................................................................. 277
5.6.2 Commentary ........................................................... 278
5.7 Section 31 ............................................................................. 280
5.7.1 Objective .................................................................. 281
5.7.2 Commentary ........................................................... 281
5.8 Similar Provisions under the Foreign Law ..................... 283
5.9 Penalty .................................................................................. 283
5.10 Cross References ................................................................. 283
The Companies Act 1956 .................................................. 283
The Partnership Act 1932 ................................................. 284
CHAPTER 6
Contributions
6.1 Scope Of The Chapter ........................................................ 285
6.2 Section 32 ............................................................................. 285
6.2.1 Objective .................................................................. 286
6.2.2 Commentary ........................................................... 286
6.3 Section 33 ............................................................................. 288
6.3.1 Objective .................................................................. 288
6.3.2 Commentary ........................................................... 288
6.4 Similar Provisions under the Foreign Law ..................... 290
6.5 LLP Rules 2009—Rule 23 .................................................. 291
6.5.1 Text of Rule 23 ........................................................ 291
6.5.2 Commentary on Rule 23 ...................................... 292
6.6 Penalty .................................................................................. 292
6.7 Cross References ................................................................. 293
Limited Liability Partnership Act 2008 .......................... 293
The Companies Act 1956 .................................................. 293
CHAPTER 7
Financial Disclosures
7.1 Scope Of The Chapter ........................................................ 295
7.2 Section 34 ............................................................................. 296
7.2.1 Objective .................................................................. 297
7.2.2 Commentary ........................................................... 297
7.3 Section 35 ............................................................................. 302
7.3.1 Objective .................................................................. 302
7.3.2 Commentary ........................................................... 303
7.4 Section 36 ............................................................................. 304
7.4.1 Objective .................................................................. 304
7.4.2 Commentary ........................................................... 304
7.5 Section 37 ............................................................................. 305
7.5.1 Objective .................................................................. 305
7.5.2 Commentary ........................................................... 305
7.6 Section 38 ............................................................................. 306
7.6.1 Objective .................................................................. 307
7.6.2 Commentary ........................................................... 307
7.7 Section 39 ............................................................................. 309
7.7.1 Objective .................................................................. 309
7.7.2 Commentary ........................................................... 309
7.8 Section 40 ............................................................................. 310
7.8.1 Objective .................................................................. 310
7.8.2 Commentary ........................................................... 310
7.9 Section 41 ............................................................................. 313
7.9.1 Objective .................................................................. 314
7.9.2 Commentary ........................................................... 314
7.10 Similar Provisions Under The Foreign Law ................... 315
7.11 LLP Rules 2009—Rules 24 To 27 ..................................... 316
7.11.1 Text of the Rules ..................................................... 316
7.11.2 Commentary of the Rules and Relevant
Forms ........................................................................ 316
7.12 Prescribed Forms ................................................................. 326
7.13 Prescribed Fee ...................................................................... 326
7.14 Penalty .................................................................................. 326
7.15 Cross References ................................................................. 327
The Companies Act 1956 .................................................. 327
Annexure 7.1—Chapter VII and VIII of the LLP
Rules 2009 ............................................................................ 328
CHAPTER 8
Assignment and Transfer of
Partnership Rights
8.1 Scope Of The Chapter ........................................................ 335
8.2 Section 42 ............................................................................. 335
8.2.1 Objective .................................................................. 336
8.2.2 Commentary ........................................................... 336
8.3 Similar Provisions under the Foreign Law ..................... 340
8.4 Penalty .................................................................................. 341
8.5 Cross References ................................................................. 341
The Limited Liability Partnership Act 2008 ................... 341
The Partnership Act 1932 ................................................. 341
The Companies Act 1956 .................................................. 341
CHAPTER 9
Investigation
9.1 Scope Of The Chapter ........................................................ 343
9.2 Section 43 ............................................................................. 347
9.2.1 Objective .................................................................. 348
9.2.2 Commentary ........................................................... 348
9.3 Section 44 ............................................................................. 356
9.3.1 Objective .................................................................. 356
9.3.2 Commentary ........................................................... 357
9.4 Section 45 ............................................................................. 358
9.4.1 Objective .................................................................. 358
9.4.2 Commentary ........................................................... 358
9.5 Section 46 ............................................................................. 359
9.5.1 Objective .................................................................. 359
9.5.2 Commentary ........................................................... 360
9.6 Section 47 ............................................................................. 362
9.6.1 Objective .................................................................. 364
9.6.2 Commentary ........................................................... 364
9.7 Section 48 ............................................................................. 369
9.7.1 Objective .................................................................. 370
9.7.2 Commentary ........................................................... 370
9.8 Section 49 ............................................................................. 375
9.8.1 Objective .................................................................. 376
9.8.2 Commentary ........................................................... 376
9.9 Section 50 ............................................................................. 380
9.9.1 Objective .................................................................. 380
9.9.2 Commentary ........................................................... 380
9.10 Section 51 ............................................................................. 382
9.10.1 Objective .................................................................. 383
9.10.2 Commentary ........................................................... 383
9.11 Section 52 ............................................................................. 384
9.11.1 Objective .................................................................. 385
9.11.2 Commentary ........................................................... 385
9.12 Section 53 ............................................................................. 386
9.12.1 Objective .................................................................. 388
9.12.2 Commentary ........................................................... 388
9.13 Section 54 ............................................................................. 390
9.13.1 Objective .................................................................. 390
9.13.2 Commentary ........................................................... 390
9.14 Similar Provisions under the Foreign Law ..................... 391
9.15 LLP Rules 2009 — Rules 28 to 31 .................................... 391
Text of Rules ......................................................................... 391
Rule 28: Security Deposit for Application for
Investigation under Section 43(3)(a) ............................... 391
Rule 29: Security Deposit for Application for
Investigation Under Sections 43(1)(a) and 44 ............... 392
Rule 30 Fee for Furnishing Copy of Inspection
Report Under Section 49(2)(b) ......................................... 392
Rule 31 Authentication of Inspection Report ................ 393
9.16 Prescribed Fees .................................................................... 393
9.17 Penalty .................................................................................. 394
9.18 Cross References ................................................................. 395
The Limited Liability Partnership Act 2008................... 395
The Companies Act 1956 .................................................. 395
Annexure 9.1—Chapter IX of the LLP Rules 2009
—Investigations ................................................................... 396
CHAPTER 10
Conversion to Limited Liability
Partnership
10.1 Scope Of The Chapter ........................................................ 399
Part A—Conversion From Firm Into Limited
Liability Partnership .......................................................... 400
10.2 Section 55 ............................................................................. 400
10.2.1 Text of Schedule II ................................................. 400
10.2.2 Objective .................................................................. 400
10.2.3 Commentary ........................................................... 400
10.2.4 Provisions of Second Schedule ............................ 402
10.2.5 Procedure for Conversion of Firm into LLP ..... 409
10.2.6 LLP Rules 2009 ....................................................... 410
10.2.7 Prescribed Forms .................................................... 411
Part B—Conversion from Private Company into
Limited Liability Partnership ............................................ 414
10.3 Section 56 ............................................................................. 414
10.3.1 Text of Third Schedule .......................................... 414
10.3.2 Objective .................................................................. 414
10.3.3 Commentary ........................................................... 414
10.3.4 Procedure for Conversion of Company
into LLP ................................................................... 419
10.3.5 LLP Rules 2009 ....................................................... 420
10.3.6 Forms ........................................................................ 421
Part C—Conversion From Unlisted Public Company
Into Limited Liability Partnership ................................... 423
10.4 Section 57 ............................................................................. 423
10.4.1 Text of Fourth Schedule........................................ 423
10.4.2 Objective .................................................................. 423
10.4.3 Commentary ........................................................... 423
10.4.4 Procedure for Conversion .................................... 426
10.4.5 LLP Rules 2009 ....................................................... 426
Part D—Common Provisions ........................................... 427
10.5 Section 58 ............................................................................. 427
10.5.1 Objective .................................................................. 429
10.5.2 Commentary ........................................................... 429
10.5.3 LLP Rules 2009 ....................................................... 430
10.6 Taxation Impact Of Conversion Into LLP...................... 432
10.7 Similar Provisions under the Foreign Law ..................... 432
10.8 Conversion Of LLP Into A Company ............................. 435
10.9 Prescribed Fees .................................................................... 435
10.10 Penalties ................................................................................ 436
10.11 Cross References ................................................................. 437
The Limited Liability Partnership Act 2008................... 437
The Indian Partnership Act 1932 .................................... 437
SEBI (Disclosure and Investor Protection)
Guidelines 2000 ................................................................... 437
The Companies Act 1956 .................................................. 437
Annexure 10.1—The Second Schedule .......................... 438
Annexure 10.2—The Third Schedule ............................. 443
Annexure 10.3—The Fourth Schedule ........................... 448
CHAPTER 11
Foreign Limited Liability
Partnerships
11.1 Scope Of The Chapter ........................................................ 455
11.2 Section 59 ............................................................................. 455
11.3 Objective ............................................................................... 456
11.4 Commentary ........................................................................ 456
11.4.1 Establishment of Place of Business in India ...... 456
11.5 Similar Provisions under the Foreign Law ..................... 458
11.6 LLP Rules 2009—Rule 34 .................................................. 459
11.7 Procedural Aspects ............................................................. 459
11.7.1 Filing and Other Requirements ........................... 459
11.7.2 Certification and Authentication ....................... 461
11.7.3 Forms to be filed by FLLP ..................................... 462
11.7.4 Prescribed Fees ....................................................... 463
11.7.5 Hints for Filing Prescribed Forms Under
Rule 34 ..................................................................... 463
11.8 Penalty .................................................................................. 465
11.9 Cross References ................................................................. 465
The Limited Liability Partnership Act 2000................... 465
The Companies Act 1956 (Part XI).................................. 466
Annexure 11.1—Text of Rule 34 pursuant to
Section 59 ............................................................................. 466
CHAPTER 12
Compromise, Arrangement or Reconstruction
of Limited Liability Partnership
12.1 Scope Of The Chapter ........................................................ 471
12.2 Section 60 ............................................................................. 472
12.2.1 Objective .................................................................. 473
12.2.2 Commentary ........................................................... 474
12.3 Section 61 ............................................................................. 483
12.3.1 Objective .................................................................. 484
12.3.2 Commentary ........................................................... 484
12.4 Section 62 ............................................................................. 486
12.4.1 Objective .................................................................. 488
12.4.2 Commentary ........................................................... 488
12.5 Similar Provisions under the Foreign Law ..................... 496
12.6 LLP Rules 2009 .................................................................... 497
12.6.1 Text of Rule 35 ........................................................ 497
12.7 Concept LLP (Winding Up And Dissolution)
Rules—Rules 240 And 241 ................................................ 502
12.7.1 Text of Rule 240 ..................................................... 502
Commentary ........................................................... 503
12.7.2 Text of Rule 241 ..................................................... 503
Commentary ........................................................... 503
12.8 Forms To Be Used For Sections 60, 61, 62 Read
With Rule 35 ........................................................................ 504
12.9 Prescribed Fees .................................................................... 506
12.10 Penalties ................................................................................ 507
12.11 Cross References ................................................................. 507
The Limited Liability Partnership Act 2008................... 507
The Companies Act 1956 .................................................. 508
Annexure 12.1—Text of Rule 35 pursuant to
sections 60, 61, and 62 of LLP Act 2008 ......................... 508
CHAPTER 13
Winding up and Dissolution
13.1 Scope of the Chapter .......................................................... 517
13.2 Section 63 ............................................................................. 518
13.2.1 Objective .................................................................. 518
13.2.2 Commentary ........................................................... 518
13.3 Section 64 ............................................................................. 520
13.3.1 Objective .................................................................. 521
13.3.2 Commentary ........................................................... 521
13.3.3 Departmental Clarification .................................. 524
13.4 Section 65 ............................................................................. 526
13.4.1 Objective .................................................................. 526
13.4.2 Commentary ........................................................... 526
13.5 Similar Provisions under the Foreign Law ..................... 526
13.6 LLP Concept (Winding Up And Dissolution)
Rules ...................................................................................... 529
13.6.1 Comment on the Winding up and
Dissolution Rules.................................................... 529
13.7 Forms to be Used ................................................................. 531
13.8 Prescribed Fees .................................................................... 532
13.9 Penalties ................................................................................ 532
13.10 Cross References ................................................................. 532
The Limited Liability Partnership Act 2008................... 532
The Indian Partnership Act 1932 .................................... 533
The Companies Act 1956 .................................................. 533
Annexure 13.1—Concept Limited Liability
Partnership (Winding up and Dissolution) Rules ....... 539
CHAPTER 14
Filing, Offences and Penalties
14.1 Scope Of The Chapter ........................................................ 675
14.2 Section 66 ............................................................................. 676
14.2.1 Objective .................................................................. 677
14.2.2 Commentary ........................................................... 677
14.2.3 Cross References .................................................... 677
14.3 Section 67 ............................................................................. 678
14.3.1 Objective .................................................................. 678
14.3.2 Commentary ........................................................... 679
14.3.3 Similar Provisions under the Foreign Law ........ 680
14.4 Section 68 ............................................................................. 680
14.4.1 Objective .................................................................. 681
14.4.2 Commentary ........................................................... 681
14.4.3 Similar Provisions under the Foreign Law ........ 682
14.4.4 LLP Rules 2009 ....................................................... 682
14.4.5 Prescribed Forms .................................................... 684
14.4.6 Prescribed Fees ....................................................... 684
14.4.7 Penalties ................................................................... 684
14.4.8 Cross References .................................................... 685
14.5 Section 69 ............................................................................. 685
14.5.1 Objective .................................................................. 686
14.5.2 Commentary ........................................................... 686
14.5.3 Cross References .................................................... 687
14.6 Section 70 ............................................................................. 687
14.6.1 Objective .................................................................. 687
14.6.2 Commentary ........................................................... 688
14.6.3 Cross References .................................................... 688
14.7 Section 71 ............................................................................. 688
14.7.1 Objective .................................................................. 688
14.7.2 Commentary ........................................................... 689
14.7.3 Cross References .................................................... 689
14.8 Section 72 ............................................................................. 690
14.8.1 Objective .................................................................. 690
14.8.2 Commentary ........................................................... 690
14.8.3 Cross References .................................................... 691
14.9 Section 73 ............................................................................. 692
14.9.1 Objective .................................................................. 692
14.9.2 Commentary ........................................................... 692
14.9.3 Cross References .................................................... 693
14.10 Section 74 ............................................................................. 693
14.10.1 Objective .................................................................. 693
14.10.2 Commentary ........................................................... 693
14.10.3 Similar Provisions under the Foreign Law ........ 694
14.10.4 Cross References .................................................... 695
14.11 Section 75 ............................................................................. 695
14.11.1 Objective .................................................................. 695
14.11.2 Commentary ........................................................... 696
14.11.3 Department Views on Defunct
Companies under Companies Act 1956 ........... 698
14.11.4 Similar Provisions under the Foreign Law ........ 699
14.11.5 The LLP Rules 2009 ............................................... 700
14.11.6 Prescribed Form ..................................................... 701
14.11.7 Prescribe Fees .......................................................... 702
14.11.8 Penalties ................................................................... 702
14.11.9 Cross References .................................................... 702
14.12 Section 76 ............................................................................. 703
14.12.1 Objective .................................................................. 703
14.12.2 Commentary ........................................................... 703
14.12.3 Similar Provisions Outside India ......................... 704
14.12.4 Cross References .................................................... 704
14.13 Section 77 ............................................................................. 704
14.13.1 Objective .................................................................. 705
14.13.2 Commentary ........................................................... 705
14.13.3 Similar Provisions Outside India ......................... 705
14.14 Section 78 ............................................................................. 706
14.14.1 Objective .................................................................. 706
14.14.2 Commentary ........................................................... 706
14.14.3 Cross References .................................................... 708
14.15 Section 79 ............................................................................. 708
14.15.1 Objective .................................................................. 712
14.15.2 Commentary ........................................................... 712
14.15.3 Similar Provisions under Foreign Law .............. 715
14.15.4 Cross References .................................................... 715
14.16 Section 80 ............................................................................. 715
14.16.1 Objective .................................................................. 716
14.16.2 Commentary ........................................................... 716
14.16.3 Cross References .................................................... 717
14.17 Section 81 ............................................................................. 717
14.17.1 Objective .................................................................. 718
14.17.2 Commentary ........................................................... 718
14.17.3 Cross References .................................................... 719
Annexure 14.1—Text of Rule 36 Pursuant to
Section 68 ............................................................................. 720
Annexure 14.2—Text of Rule 37 Pursuant to
Section 75 ............................................................................. 724
Annexure 14.3—Text of Notification
No SO 1844(E) Dated 26 October 2006 ......................... 726
Annexure A—Scheme for Filing of Statutory
Documents and other Transactions by
Companies in Electronic Mode ........................................ 727

PART IV
APPENDICES
App. I Text of Limited Liability Partnership Rules 2009
(Alongwith Forms)
A. Text of Rules 2009 .................................................. 747
B. Text of Forms .......................................................... 789
C. Annexures to the LLP Rules 2009 ...................... 913
App. II Prescribed Period for Preservation of Documents.... 919
App. III Statutory Provisions of Affiliate Acts
A. The Companies Act 1956 ..................................... 927
B. The Partnership Act 1932 .................................... 971
C. The Information Technology Act 2000 .............. 977
D. The General Clauses Act 1897 ............................ 989
App. IV Extracts of Committee Reports on LLP
A. Extracts from Naresh Chandra Committee
Report ....................................................................... 997
B. Extracts from Irani Committee Report ............ 1007
App. V FAQs on LLP issued by the Ministry of Corporate
Affairs ............................................................................. 1009
Index.................................................................................................. 1029

Dr Sanjiv Agarwal is a Fellow Member (FCA) of the Institute of Chartered Accountants of India, a Fellow Member (FCS) of the Institute of Company Secretaries of India and an Associate Member (ACIS) of the Institute of Chartered Secretaries and Administrators of UK. He holds a postgraduate degree in Accountancy and Business Statistics and also a PhD in Corporate Governance from the Faculty of Management Studies, University of Rajasthan, Jaipur. Dr Agarwal has over 25 years of professional experience as a Chartered Accountant with exposure in corporate governance, auditing, corporate laws and service tax matters. He has so far authored/edited 24 books. He was a member of Working Group on Corporate Governance set up by the Department of Company Affairs, Ministry of Finance, Government of India in 2002 and also is a member of Secretarial Standards Board of ICSI, on which he has served on two earlier occasions also. He has also served as the Chairman of Northern Indian Regional Council of the Institute of Company Secretaries of India, New Delhi and Chairman of Jaipur Branch of the Institute of Chartered Accountants of India. He has been a SEBI nominated Director on the Boards of Jaipur Stock Exchange Ltd and JSEL Securities Ltd. He is presently an independent Director on the Board of State Bank of Bikaner and Jaipur since 2004.
Rohini Aggarawal is a Fellow Member (FCA) of the Institute of Chartered Accountants of India, a member of the Institute of Cost and Works Accountants of India and a law graduate. A prolific author and researcher, she has authored various well accepted and authoritative books on subjects such as Commercial Laws including the Indian Contract Act and Partnership Act, Company Law Compliance Certificate and Service Tax: Law and Practice. She has worked as a consultant to various multinational and Indian clients and has appeared before various departmental authorities on matters of indirect tax including service tax. She also holds a professional experience of over 17 years and is presently working as a management consultant and mainly deals in corporate laws and indirect taxation.