- Lawyer Mr. Shaman Jain
- Skills Change In Business
- CATEGORY Change In Business, Compliances
ABOUT THIS PRACTICE
LLP and it’s operations are completely governed by a basic document called LLP Agreement . The partners are required to follow the clauses laid by it and must not do anything beyond the scope of this agreement . An LLP Agreement can be altered any time after incorporation with the mutual consent of the partners. Among various reasons, change in activities or capital or rights and responsibilities are main reasons that lead to change.
To alter any of the clauses, an additional agreement is executed as an appendix to the original agreement. It will be executed by payment of required stamp duty. Any change must be notified to the RoC (LLP) within 30 days of change or execution of the supplementary deed.
Reasons for change in LLP Agreement
- Change Business Activity: If you wish to change the activities you must modify the agreement since the LLP cannot undertake the activities that are not included in the agreement. The activities can be changed by including new activities or product lines or even removing the previous ones that are already discontinued.
- Change capital and profit sharing ratio: Capital is the most important requirement of the business that must keep on increasing with time and growth of a business. Capital sharing ratio and profit (loss) sharing ratio are connected from the partner’s perspectives . It requires an additional step to influence both or either of them.
- Change rights and responsibilities of partners: Rights and responsibilities of partners can be changed or updated as per their roles and needs. While changing such terms one can cover various changed such as administrating powers or limiting few activities etc.
- Change other clauses: Jurisdiction of LLP, terms of resignation, notice period, conditions of appointment and removal, change in the duration of the partnership, etc are some of the important clauses that can be changed as per the requisites of the partners and business. In addition to the above alteration or deletion of clauses can also be covered.
- Digital Signature Certificate: DSC of one of authorised partner to be provided
- LLP Agreement: An agreement to be provided including the amendments, if any
- CoI: Certificate of Incorporation of LLP to be provided
- PAN Card: Copy of PAN card of the LLP to be provided
Process to modify LLP Agreement
- Discussion and consultancy for required changes
- Collection of basic Information & documents
- Drafting necessary resolutions and documents
- Drafting of Supplementary LLP Agreement
- Provide documents required provided after signature
- Payment of stamp duty on Agreement
- Preparation of application for change
- Filing LLP Form 3 and necessary documents with MCA
- Government processing time