INCORPORATION OF LIMITED LIABILITY PARTNERSHIP- PART-II - (Registration / Registered Office of LLP)

[Dr. Sanjiv Agarwal]

Section 12 of LLP Act, 2008 seeks to provide for registration of incorporation document of LLP and issue of a certificate of its incorporation by the Registrar. The said clause indicates that the certificate of registration shall be conclusive evidence that the LLP is incorporated by the name specified therein.

The persons desirous of forming an LLP are to submit prescribed Forms and other documents to the Registrar. Once these documents reach to the Registrar, he is to examine the said documents. The Registrar may accept the statement in Form No. 3 filed along with the incorporation document, as sufficient evidence as to the fact that the purpose of the proposed LLP is to carry on a lawful business with a view to earn profit and that it has two or more partners to carry out such business, or he may call for further information or evidence to authenticate the facts.

Where the Registrar, on examining the documents filed for incorporation, finds it necessary to call further information or finds such application or e-Form or document to be defective or incomplete in any respect, as per Rule 36(6) of the LLP Rules, he shall give intimation of such information called for or defects or incompleteness noticed electronically, by placing it on the website and also by e-mail on the last intimated e-mail address of the person or the Limited Liability Partnership, which has filed such application or e-Form or document, directing him or it to furnish such information or to rectify such defects or incompleteness or to re-submit such application or e-Form or document. In case the e-mail address of the person or the Limited Liability Partnership in question is not available, such intimation shall be given by the Registrar by post at the last intimated address given in Form 12, or registered office address of the Limited Liability Partnership or the address of such person as the case may be. The Registrar shall preserve the facts of such intimation in the electronic record. Sub-rule 7 of Rule 36 provides that except as otherwise provided in the Act, the Registrar shall give an opportunity allowing thirty days time to such person or such LLP which has filed such application or e-Form or document, for furnishing further  information or for rectification of the defects or incompleteness or for re-submission of such application or e-Form or document. (Except as otherwise provided in the Act, the Registrar shall not keep any document pending for approval and registration or for taking on record or for rejection or otherwise for more than one hundred twenty days, from the date of its filing)

In the event, such further information called for has not been provided or has been furnished partially or has not been provided or defects or incompleteness has not been rectified or has been rectified partially or has not been rectified to the satisfaction of the Registrar, despite opportunity provided under sub-rule (7), the Registrar shall either reject or treat and label such application or e-Form or document as the case may be as "invalid" in the electronic record, and shall not take on record such invalid application or e-Form or document and shall inform such person or company as the case may be accordingly in the mode, as specified in sub-rule (6) . Where any document has been recorded as invalid by the Registrar, such document may be rectified by the company only through fresh filing with payment of fee and additional fee as applicable, without prejudice to any other liability under the Act.

In case, the Registrar is satisfied that the statement filed in Form 3 is sufficient evidence as to the fact that the purpose of the proposed LLP is to carry on a lawful business with a view to earn profit, he will issue a certificate of registration within a period of fourteen days (in Form No. 16) stating that the limited liability partnership is incorporated by the name specified therein. The certificate of incorporation so issued shall be signed by the Registrar and authenticated by his official seal.

This certificate shall be conclusive evidence that the limited liability partnership is incorporated by the name specified therein. The Companies Act, 1956 also contains similar provision. In context of companies, it has been held that the certificate of incorporation is conclusive evidence that everything is in order with respect of registration and that the company has come into existence from the earliest moment of the day of incorporation stated therein with rights an liabilities of a natural person, competent to enter into contracts [Jubilee Cotton Mills Limited v. Lewis, 1924 A.C. 958.]  In Mosa v. Ebrahim ILR 1913 40 Cal. 1 (P.C.), the memorandum of association of a company was signed by two adults and by a guardian of other five subscribers, who were minors. The Registrar, however, registered the company and issued under his hand a certificate of incorporation. It was contended that this certificate should be held void. Lord Macnaughten said: "Their Lordships will assume that the conditions of registration prescribed by the Indian companies Act were not duly complied with; that there were no seven subscribers to the memorandum and that the Registrar ought not to have granted the certificate. But the certificate is conclusive for all purpose. Thus the certificate prevents anyone alleging that the company does not exist."

Even if the two signatures to a memorandum were made by one person, or were forged, the certificate would be conclusive that the company was duly incorporated. So too, if the signatories were all minors, the certificate would still be conclusive. [Hammond v. Prentice Bros (1920) 1 Ch. 201 and Bowman v. Secular Society Ltd. 1917 AC 406 438]

The certificate though conclusive evidence of the existence of a company ( as in the case of an LLP), it cannot legalise the illegal object contained in the memorandum. [Performing Right Society Ltd. v. London Theatre of Varities (1992) 2 KB 433)]

Registered office of limited liability partnership

Section 13 of LLP Act, 2008 seeks to provide that every LLP shall have a registered office to which all communications will be made and received. It also seeks to provide for mode of serving the documents to LLP and intimating the change of the address of the registered office in the prescribed manner and subject to prescribed conditions to the Registrar.

Every limited liability partnership must have a registered office. It is vital that an LLP keeps the Registrar informed of the location of its registered office. This is the 'home' of the limited liability partnership to which all official documents, notices and court papers have to be sent by law. The address must be a physical location, not just a post office box and must be located in India. This is because people have the right to visit LLP's office to inspect certain registers and documents, and to deliver documents by hand. If there is any change in the address of such registered office, an LLP is required to intimate the fact of such change to the public as well as to the Registrar by following the prescribed procedure.

Section 13(1) state that an LLP must have a registered office to which all communications and notices may be addressed and where they shall be received. Thus the law ensures that when a communication is sent to an address provided by an LLP, it would be received (and also considered to be received even if no formal acknowledgment is there) at the other end.

Also, the limited liability partnership, may, in addition to the registered office address, declare any other address as its address for service of documents under 13(2). For this, the LLP will have to follow the procedure as laid down in its partnership agreement. Where the limited liability partnership agreement is silent on this matter, consent of all partners shall be required for declaring any other address as the address for service of documents.

At the time of incorporation, the document of incorporation contains the details of the office of the LLP to be registered, which is recognized as registered office. In case, an LLP decides to give additional address to the Registrar for the purpose of service of documents to LLO, the intimation of such other address shall be given to the Registrar in Form 12, within 30 days of decision to do so.

In case, an LLP changes its registered office from the one registered with the Registrar, it is required to intimate such changed address to the Registrar by following the prescribed procedure in this regard. Further, the registered office of the LLP must not be confused with its trading address(es). 

Section 13(2) read with Rule 15 of the LLP Rules provides the various modes in which a document can be serviced to an LLP or its partner or designated partner. These are -

    1. by sending it by post under a certificate of posting, or

    2. by registered post, or

    3. by electronic transmission*  - refers to fax or e-mail directed to the fax number or e-mail address communicated by LLP or its partners/designated partners for such purposes, or posting on an electronic message board or network, if any designated by LLP or its partners/designated partners for such communication or other means of electronic communication, or

    4. by courier (a document sent through a courier which provides the proof  of delivery)

at the registered office and any other address specifically declared by the limited liability partnership for the purpose. These documents can also be served at the additional address, if any intimated by an LLP to the Registrar for the purpose of serving documents. For this LLP is to submit Form No. 12 to the Registrar and the effective date for the service of documents to LLP at such other address cannot be prior to the date of filing of such form. 

Section 13(3)

An LLP can change its registered office by sending a completed Form No. 15 to the Registrar, along with the prescribed fee. The change becomes legally effective only when the form is filed. The procedure in this regard is as under -

    * In case, the partnership agreement provides any procedure to take a decision for change of registered office, it shall be followed.

    * Where the limited liability partnership agreement is silent on this matter, consent of all partners shall be required for changing the place of registered office of limited liability partnership to another place.

 

    * Notice of change of place of registered office shall be given to Registrar in form 15, along with a fee mentioned in Annexure B. Where there is any conviction, ruling, order or judgment of any Court, tribunal or other authority against the limited liability partnership, the particulars of such prosecutions initiated against or show cause notices received by the limited liability partnership for the alleged offences under the LLP Act shall be stated in the notice of change of place of registered office to be filed with the Registrar.

    * In case, Registered office of LLP is to be shifted from one state to the other, has additional obligation to give at least one month's public notice before filing any notice with Registrar, in the district in a daily newspaper published in English and in the principal language of the district in which the registered office of the limited liability partnership is situated and circulating in that district giving notice of change of registered office.

    * Notice to change the registered office ( i.e. Form 15) is to be filed with the Registrar from where the limited liability partnership proposes to shift its registered office with a copy thereof for the information to the Registrar under whose jurisdiction the registered office is proposed to be shifted.

    * The fee to be paid for filing Form No. 15 is as per Annexure B of the LLP Rules.

Section 13(4)

This sub-section prescribes penalty for non compliance of the provisions of Section 13. If the limited liability partnership contravenes any provisions of this section, the limited liability partnership and its every partner shall be punishable with fine which shall not be less than two thousand rupees but which may extend to twenty-five thousand rupees.