THE Ministry of Corporate Affairs wants other ministries, state governments and sectoral regulators to recognise limited liability partnerships (LLP) after over 100 entities registered under the LLP Act enacted last year.The ministry will write to all departments and regulators concerned to align their respective norms as per the new business structure, an official in the ministry said.
The ministry will soon write to state governments to recognise LLPs for purposes of stamp duty. It will also ask various ministries such as commerce and the department of industrial policy & promotion (Dipp) to amend their respective laws, so as to accept LLP as a recognised business form, he said.Among the various regulators, the ministry plans to approach the Insurance Regulatory and Development Authority (Irda), asking it to amend its definition of business forms as defined in existing norms, the official added.
This will ensure that LLP entities enjoy all the benefits and concessions available under law and are not discriminated against merely because some existing regulations do not consider LLPs as a business form, he added.
In Budget 2009, the government announced that LLPs would be taxed like partnerships firms. The taxation of LLP income will be in the hands of the entity and the profit accruing to the partners will be exempt from income tax.