What is Partnership Firm/LLP?
A partnership firm is an organization which is formed with two or more persons to run a business with a view to earn profit. Each member of such a group is known as partner and collectively known as partnership firm. These firms are governed by the Indian Partnership Act, 1932.
A limited liability partnership is a legal entity, liable for the full extent of its assets. The liability of the partners, however, is limited. Hence, LLP is a hybrid between a company and a partnership. These Partnerships are governed by the LLP Act, 2008.
A Partnership Firm/LLP can be converted into a Company registered under Companies Act, 2013, for such conversion there is need to prepare a list of documents and file the same with ROC.
Hold a meeting of the partners to take assent of majority of its partners summoned for the purpose of registering the Partnership firm under Section 366 of the Companies Act, 2013. And To authorize two or more partners to take all steps necessary and to execute all papers, deeds, documents etc. pursuant to registration of the Partnership firm as a Company.
Make a Public announcement by way of Newspaper advertisement seeking objections (if any) within 21 clear days from the date of Publication. Such announcement shall be in Form No. URC-2, which shall be published in English Newspaper and in any Vernacular language circulating in the district in which Partnership Firm/LLP is situated.
Obtain No objection certificate from the concerned Registrar of Firms or Registrar of Companies (LLP);
Obtain No Objection certificate from the secured creditors (if any).
Prepare and File the following below mentioned Forms.
In E-form URC-1
> the nominal share capital of the company and the number of shares into which it is divided;
> the number of shares taken and the amount paid on each share;
> the name of the company, with the addition of the word “Limited” or “Private Limited” as the case may require, as the last word or words thereof;
In E-form Spice+
|Distinct entity||Not a separate legal entity||Is a separate legal entity under the Companies Act, 1956/2013 .|
|Perpetual Succession||It does not have perpetual succession as this depends upon the will of partners||It has perpetual succession and members may come and go.|
|Credit Worthiness of organization||Creditworthiness of firm depends upon goodwill and creditworthiness of its partners||Due to Stringent Compliances & disclosures under various laws, Companies enjoys high degree of creditworthiness.|