Partnership

TG Team 07 Jul 2009 739 Views 0 comment Print Corporate Law | Articles

COMPARISON – LLP / Company / Partnership

S. No	Conditions	LLP	Company	Partnership
1.	Registration	To be registered with Registrar of LLP under LLP Act 2008	To be registered with Registrar of Companies under Companies Act 1956.	Registration is optional
2	Name	Name should contain ‘Limited Liability Partnership’ or ‘LLP’ as last words	Name should contain ‘Limited’ / ‘Private Limited’ as last words	Any name as per choice
3.	Legal entity	LLP is a separate legal entity registered under LLP Act	Company is a separate legal entity regisered under Companies Act, 1956	Not a separate legal entity
4.	Formation Cost	The cost of Formation is lesser that of formation of Company.	The cost of Formation is higher than that of formation of LLP	The Cost of Formation is negligible.
5.	Formation by Foreign Nationals	Foreign Nationals alone can not form a LLP.	Foreign Nationals alone can form a Company	Foreign Nationals can not form Partnership Firm in India.
6.	Minimum Number of Members	Minimum 2 partners	Minimum 2 in case of Private Company 7 in case of Public Company.	2
7.	Management Team	Minimum 2 Designated partners	Minimum 2 / 3 Directors	No requirements
8.	Administration.	Designated Partners are responsible for day to day operations and statutory compliances	Directors are responsible for day to day operations and statutory compliances	Partners are responsible for day to day operations and statutory compliances
9.	Remuneration to Managerial Personnel	Remuneration to partners will be determined on LLP Agreement	Remuneration to Directors of Public Companies are governed by Companies Act	The firm can pay remuneration to its partners
10.	Liability of Partners / Members	Limited to the extent of contribution towards LLP	Limited to the amount of share capital agreed to be contributed on each share	Partners have unlimited liability
11.	Capital Contribution	Determined by partners as per the LLP agreement.	Limited to the unpaid amount of share capital agreed to be contributed	Unlimited may extend to their personal assets
12.	Tax Liability	Notification from IT Department awaited	Income of Company is Taxed at a Flat rate of 30% Plus surcharge as applicable.	Income of Partnership is Taxed at a Flat rate of 30% Plus surcharge as applicable.
13.	Transfer of ownership Rights	Ownership transfer is governed by the LLP Agreement.	Ownership is easily transferable by transfer of shares	Not transferable.
14.	Statutory Meetings	There is no requirement to hold any meeting	Board Meetings and General Meetings are required to be conducted as per Companies Act	There is no provision in regard to holding of any meeting
15.	Maintenance of Statutory Records / Minutes Book	Required to maintain books of accounts.	Required to maintain books of accounts, statutory registers, minutes etc.	Required to maintain books of accounts as Tax laws
16.	Annual Filing	Annual Statement of accounts and Solvency & Annual Return needs to be filed every year.	Annual Accounts and Annual Return needs to be filed with the Registrar of Companies	No return except Tax returns
17.	Agreements / Contracts with Partners/Director	Partners are free to enter into any contract with LLP	There are restrictions for contracts in which directors are interested.	Partners are free to enter into any contract partnership
18.	Reputation	LLP enjoys higher reputation compared to Partnership as it is registered and regulated by LLP Act	Due to Stringent Compliances & disclosures under various laws, Companies enjoys high degree of creditworthiness	Creditworthiness of firm depends upon goodwill and creditworthiness of its partners
19.	Dissolution	Voluntary or by order of National Company Law Tribunal.	Voluntary or by order of National Company Law Tribunal.	By agreement, mutual consent, insolvency, certain contingencies, and by court order.

Powered By : www.companiesinn.com
CompaniesInn.com India Private Limited
# 463, 10th Main | 13th Cross | Wilson Garden | Bangalore—560 027 | INDIA
Tel : +91 80 4219 4109, Mobile : +91 96633 29656
E-Mail : info@companiesinn.com