Designated Partner in LLP

  • July 29, 2016
  • Dushyant Sharma
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Every entity requires a human mind to run the entity. So, in a similar way, LLP also requires this individual mind who is called a partner in the LLP. Partners are the key persons who run the LLP. As we all know LLPs are governed by the LLP Act, 2008. LLP act mandates that every limited liability partnership has at least 2 designated partners.

The word designated has been added to the word partner to give more weightage. Designated partners play an important role in functioning of LLP. Their role is different from the other partners in the LLP. Let's first understand different types of partners in the LLP:

  1. Active Partner: Active partners participate in day to day working of the LLP or we can say manage the whole affairs of the LLP.
  2. Sleeping or Dormant Partner: Sleeping partner does not participate in the management of the business. They only contribute capital in the LLP.
  3. Partner by estoppel or holding out: when a person by his conduct or words holds out to others that he is a partner then he can not deny at a later stage that he is not a partner.

Designated partners come under the category of Active Partner. There is another condition which you must keep in mind that while registering LLP in India makes sure that at least one of the 2 designated partners must be an Indian resident.

Some Key Points about Designated Partners

  1. An individual consent is necessary before appointing him as a designated partner.
  2. Every designated partner shall have Designated partner Identification Number (DPIN)
  3. The incorporation documents must mention the name of Designated Partners.

Who can be appointed as designated Partner

To be appointed as designated partner, a person has to observe the conditions as prescribed under the LLP act. A person can not be appointed as Designated partner:

  • If a person has been declared as insolvent at any time within 5 years.
  • He has been convicted by the court for ant offence and sentenced to imprisonment for the period of 6 months.

In case, any vacancy arises then LLP should appoint a designated Partner within 30 days of such vacancy. If no person is appointed as designated partner then each partner shall be deemed to be designated partner.

Changes in the Particulars of the Designated Director

If there is any change in the particulars of the director then such changes have to be intimated to the Government in Form 10 within 30 days of the changes occurred.

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Dushyant Sharma
Author: Dushyant Sharma

Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.

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