The Limited Liability Partnership Act 2008 was published in the official Gazette of India on 9 January 2009 and has been notified with effect from 31 March 2009.
An LLP is different from that of a “Limited Partnership”. It operates like a limited partnership, but in an LLP each member is protected from personal liability, except to the extent of their capital contribution in the LLP. An LLP is a Separate legal entity like any other company or firm, wherein it’s partners and the LLP they constitute remain distinct from each other. An LLP is exempt from Dividend Distribution Tax (DDT) and Minimum Alternative tax (MAT). All details about LLP firms can be checked on the portal of Ministry of Corporate Affairs (MCA). Under an LLP, no partner would be liable on account of the independent or unauthorized actions of other partners, thus allowing individual partners to be shielded from joint liability created by another partner’s wrongful business decisions or misconduct. The Registrar of Companies (ROC) shall register and control LLPs.
The IMA LLP constitutes “Designated Partners” and “Partners”, wherein the former has complete responsibility of day to day affairs of the company and it’s business conducted, and the contribution of Partners towards the LLP is limited only to the extent of their Capital Contribution. Partners are subject to the agreed upon Terms and Conditions as constituted between the Designated Partners and other Partners in the IMA LLP.
CAPITAL CONTRIBUTION: Partners must contribute by way of Cheque or other mode of payments except Cash.
RETURNS ON CAPITAL INVESTED: Since IMA LLP works on the Halal Business Module, the profit/return generated is subject to market risks and no assured return is promised. In addition to enjoying returns/profits, partners are equally responsible to bear any losses that may arise in the due course of operations. This is due to the Islamic Sharia guidelines on which the IMA LLP is based and conducts its business operations. Partner returns are proportionate to their capital invested.
TAXATION ON RETURNS GENERATED: For every financial year of operations, the payout of all returns/profit to partners generated on account of business operations of the LLP is subject to deductions payable to the Government of India by way of Income Tax liable on the LLP. The Returns/Profits paid out to partners after each financial year ends i.e. on March 31st, is treated as tax paid income.
DETAILS OF PARTNERS ON ROC (REGISTRAR OF COMPANIES) website: As required by the LLP ACT of 2008, all details of Partners relevant to the LLP will be mentioned and accessible to all via the Ministry of Corporate Affairs.