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Section 44

LLP agreement (outline)

Use it to draft the agreement between the partners of a limited liability partnership (LLP) right after the LLP is incorporated.

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Template for general guidance; not legal advice. Check stamp duty and registration rules in your state. LIMITED LIABILITY PARTNERSHIP AGREEMENT (OUTLINE) This agreement is made at Place of signing on Date of agreement between the partners named below and Name of the LLP, a limited liability partnership with LLPIN LLP Identification Number (LLPIN), incorporated on Date of incorporation, having its registered office at Registered office address (called "the LLP"). Partners: 1. Partner 1: full name, of Partner 1: address 2. Partner 2: full name, of Partner 2: address 1. Business. The LLP will carry on the business of Business of the LLP, and any other lawful business that the partners decide. 2. Registered office. The registered office is at Registered office address. It may be moved by a decision of the partners and after filing the required form with the Registrar. 3. Contribution. The partners will contribute as follows: Partner 1: ₹Partner 1: contribution (₹) Partner 2: ₹Partner 2: contribution (₹) Further contribution will be made only as decided by all partners. 4. Profit and loss. Profit and loss of the LLP will be shared: Partner 1 Partner 1: profit share (%)%, Partner 2 Partner 2: profit share (%)%. 5. Designated partners. Designated partners (names) will be the designated partners. They are responsible for the LLP's filings and compliance under the Limited Liability Partnership Act, 2008. 6. Remuneration. Working partners will be paid Monthly remuneration to working partners (₹, or nil) per month, as decided by the partners. 7. Management and decisions. Day-to-day business is managed by the designated partners. The following need the consent of all partners: change in the nature of business; admitting a new partner; borrowing beyond normal trade credit; giving any guarantee; selling the whole or a major part of the business. 8. Bank account. The LLP's bank account will be operated by Who signs cheques and payments. 9. Books and audit. The LLP will keep proper books of account at its registered office and get them audited where the law requires. Every partner may inspect the books. 10. Admission of new partner. A new partner may be admitted only with the consent of all existing partners, by a written supplementary agreement. 11. Resignation. A partner may resign by giving Notice to resign (months) months' written notice to the other partners. The resigning partner will be paid his or her contribution and share of profits as shown in accounts drawn up to the date of leaving, within a period the partners agree. 12. Expulsion. A partner may be expelled only for serious breach of this agreement or fraud, by a decision of the other partners, after giving the partner a fair chance to be heard. 13. Duty not to compete. A partner will not carry on any business that competes with the LLP without the consent of the LLP. If he or she does, all profits from that business must be paid to the LLP. 14. Disputes. Disputes between partners, or between a partner and the LLP, will first be settled by discussion, and failing that within 30 days, by a sole arbitrator chosen by the partners. The place of arbitration will be City for arbitration of disputes. 15. Winding up. The LLP may be wound up by a decision of the partners or as provided in the law. 16. Other matters. Any matter not covered in this agreement will be governed by the Limited Liability Partnership Act, 2008 and, where the Act says so, by its First Schedule. 17. Filing. This agreement will be filed with the Registrar in LLP Form 3 on the MCA portal within 30 days of incorporation. Any change to this agreement will also be filed in Form 3 within 30 days of the change. Signed: Partner 1: ______________________ (Partner 1: full name) Partner 2: ______________________ (Partner 2: full name) For Name of the LLP: ______________________ (Designated Partner) Witnesses: 1. ______________________ 2. ______________________

Know before you sign

  • The LLP agreement is filed with the Registrar in LLP Form 3 on the MCA portal. The Ministry of Corporate Affairs says the first agreement must be filed within 30 days of incorporation, and any change within 30 days of the change. Late filing attracts additional fees.
  • Section 23 of the Limited Liability Partnership Act, 2008 says the agreement governs the rights and duties of the partners. If the agreement is silent on a matter, the First Schedule of the Act applies (for example, equal sharing of profits and no remuneration to partners).
  • An LLP must have at least two partners (section 6) and at least two designated partners who are individuals, with at least one resident in India (section 7).
  • A written agreement made before incorporation can bind the LLP only if all partners ratify it after incorporation (section 23(3)).
  • Stamp duty on the LLP agreement is charged by the state. Pay it before filing Form 3 and check the rate with your state's stamps department.
  • This is an outline. Get it reviewed by a company secretary, chartered accountant or lawyer, especially the clauses on resignation payouts, expulsion and partner remuneration.
Sources (3)
  1. The Limited Liability Partnership Act, 2008 (Act No. 6 of 2009): sections 6, 7 and 23, First Schedule · 2009
  2. Form 3: Information with regard to LLP agreement and changes therein · 2023
  3. Revised filing steps and FAQs of Form 3 LLP · 2023

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