Limited Liability Partnership (LLP) refers to a body corporate or partnership formed and incorporated under the provisions of Limited Liability Partnership Act, 2008. The following attributes of a Limited Liability Partnership sets it distinct from other forms of legal entities and is garnering popularity in the business world
LLPs are often misinterpreted as Partnership Firms but there is a very thin line of difference between these two forms of legal entities which had been highlighted in the following table
||LLP shall have either words “Limited Liability Partnership” or acronym LLP as the last words of its name.
||A partnership firm may choose any name of their choice. However if the firm is registered, then it shall use the brackets and word (Registered) immediately after its name.
||LLPs has perpetual succession as its identity is distinct from its designated partners.
||Existence of a partnership firm depends upon the will of its partners so a partnership firm does not have perpetual succession.
||Liability of the Partners
||A partner is not directly or indirectly or personally liable, for the obligations arising in contract or otherwise solely by reason of being a partner of the LLP.
||Every partner in a partnership firm is jointly and severally liable with other partners for all the acts of the firm done while he is a partner.
||Legal Effect of Registration
||Upon registration the LLPs shall, by its name be capable of suing and being sued.
||No suit to enforce a right arising from a contract or conferred by the Partnership Act shall be instituted in any Court by or on behalf of any persons suing as a partner in a firm against the firm or any third party or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.