LIMITED LIABILITY PARTNERSHIPS - PART IX (Registration of changes in partners)

[Dr. Sanjiv Agarwal]

Registration of Changes in Partners (Section 25)

Section 25 of LLP Act, 2008 seeks to provide for the requirement and the procedure for filing notice about changes in the names and addresses of partners of the LLP to the Registrar. The notice shall be in such form as may be prescribed. The clause also seeks to provide that every partner shall inform the LLP of any change in his name or address within fifteen days of such change, failing which he shall be punishable with fine which shall not be less than two thousand rupees but which may extend to twenty-five thousand rupees. This clause further seeks to provide that when a person becomes or ceases to be a partner, the LLP shall file a notice with the Registrar within thirty days from the date such person becomes or ceases to be a partner, failing which the LLP shall be punishable with fine which shall not be less than two thousand rupees but which may extend to twenty-five thousand rupees.

Intimation by Partner to LLP

On any change in the name or address of a partner, it is responsibility of such partner to intimate LLP about such change within 15 days thereof. This intimation is to be given by partners to LLP in Form No. 6. If any partner contravenes these provisions, such partner shall be punishable with fine which shall not be less than two thousand rupees but which may extend to twenty-five thousand rupees.

Notifying to Registrar

Section 25 of LLP Act, 2008 provides for the requirement of notifying the Registrar about the changes in the partners of an LLP.

Once LLP is informed of this change, it is obligation of the LLP to inform the Registrar in turn about such changes within a period of 30 days. Further, whenever a partner is admitted to LLP or ceased to be a partner of LLP, it has same obligation of intimating the Registrar about these facts within 30 days thereof. This intimation is to be given to the Registrar in Form No. 5 signed by a designated partner. The form shall be accompanied by a certificate from a company secretary in practice/Chartered Accountant in practice/Cost Accountant in practice that he has verified the particulars including from the books and records of the limited liability partnership and found them to be true and correct. Further, in case of intimation in relation to admission of a partner, the form shall also include a statement signed by the incoming partner that he consents to become a partner. This Form is to be accompanied by the fee prescribed in Annexure B to the Rules.

If the limited liability partnership contravenes the above provisions in relation to intimation of change in the status/address/name of its partners, the limited liability partnership and every designated partner of the limited liability partnership shall be punishable with fine which shall not be less than two thousand rupees but which may extend to twenty-five thousand rupees.

Filing by Self

In case a person who ceases to become a partner finds that the LLP has not filed notice of his cessation of interest in partnership with the Registrar in contravention of the provisions of Section 25(2), he can himself file Form No. 5 to the Registrar intimating about his cessation of interest in LLP. After receiving such notice, from a partner, the Registrar is required to seek confirmation from LLP to this effect and if LLP fails to confirm this within 15 days, the registrar would register such change in his records.

Penalty for Non-compliance

Specific penalties have been prescribed for contravention of different provisions under Section 25 of the Act. Where under sub-section (1) of Section 25 a partner fails to comply with the intimation requirement of changes in his name or address to LLP within 15 days of the change thereof, he may be subjected to a minimum fine of Rs. 2000/- which may be extended to Rs. 25,000/-. Where an LLP contravenes provisions of sub-section (2) of Section 25 in relation to intimation of changes in partners to the Registrar, the LLP and also all its designated partners may also be subjected to a minimum fine of Rs. 2000/- which may be extended to Rs. 25,000/-.