Thursday, January 24, 2013

Limited Liability Partnership In India

Limited Liability Partnership In India

Limited liability partnership is a partnership but as it is clear from the name itself, it has a limited burden of liability distinct from the traditional one where the liability was not limited and all the partners had to bear the burden in case of loss in business. An LLP have the benefits of both a Partnership and a company. In reality, It lies somewhere between the partnership and the body corporate. To understand it, we must first know about what is partnership and body corporate or a company. According to the Indian Partnership Act, a Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. Unlike an incorporated company a partnership does not have a legal personality of its own. On the other hand a body corporate is a form of business in which the members join and pool their resources together to do business but the basic difference between a partnership and a corporation is that a corporation has a distinct legal personality different from its members. It also has a perpetual succession i.e. unlike a partnership, whether its partner exist or not it will to continue to exist.

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