Notes

LIMITED LIABILITY PARTNERSHIP

Nature and features of limited liability partnership (LLP) A limited liability partnership (LLP) is defined as "a legal business entity partnership whereby the LLP is responsible for the debts of the business and not the partners". The Limited Liability Partnership Act, 2008 was enacted to make provisions for the formation and regulation of limited liability partnerships. Sections 55-58 related to conversion of existing partnership firms, private as well as public unlisted companies, into LLP came into force on 31 May 2009. Further, Section 51 and Sections 63-65 related to winding up of an LLP came into force on 10 July 2012.

PARTNERSHIP ACT

Definition and nature of partnership The Partnership Act, 1932 was enacted by Parliament to regulate partnership firms in India. It is based on the English Partnership Act of 1890. It came into force on 1 October 1932. Previously, the law relating to Partnerships were contained in the Contract Act, 1872, in its Chapter XI, Sections 239-266, but the provisions were not found satisfactory and hence the Chapter was repealed and a new and separate Partnership Act was enacted. This Act extends to the whole of India except the State of Jammu and Kashmir. 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. This definition is contained in Section 4, Partnership Act, 1932 and states: