Limited Liability Partnership, A New Beginning
The Indian Government may allow a new form of Legal Entity in India called as Limited Liability Partnership and the proposed change may be one of the key features in the forthcoming budget Limited Liability Partnership (LLP) has element of Partnership and Corporations. A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners (GPs), there are one or more limited partners (LPs). The GPs are, in all major respects, in the same legal position as partners in a conventional firm, i.e. they have management control, share the right to use partnership property, share the profits of the firm in predefined proportions, and have joint and several liabilities for the debts of the partnership.
As in a general partnership, the GPs have actual authority as agents of the firm to bind all the other partners in contracts with third parties that are in the ordinary course of the partnership's business. Professionals and Investors across the world are initiating business via Limited Liability Partnership due to the following numerous advantage.
Mainly LLP is the most favored business model among professionals in law, accounting and financial services in the developed world.
Disadvantage of LLP are
In 2005, The Ministry of Company affairs has brought a concept paper on Limited
Liability. In the Year 2006 the Limited Liability Partnership Bill was introduced
in the Parliament. The Limited Liability Partnership Act is yet to be enacted.
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