Question 3 OR (b)

Procedure for converting a private company into an LLP

5 marks

Time to write
About 10 minutes

From an older CBCS paper

Question

Question 3 OR (b) · 5 marks

Write briefly how a private company is converted into a LLP: the procedure for conversion.

Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.

Before you write

Read off the question and its marks

10 minfor 5 marks

Read from the question

  • brieflyShort headed points, no long paragraphs.

Write it in this order

  1. Read; underline the asks; jot your points 1 min
  2. 1 Procedure 3 marks 5 min
  3. 2 Effect 2 marks 3 min
  4. Check: every ask answered, key terms underlined 1 min

Short on time? Trim steps 1 and 2 evenly rather than skip one: each is capped at its own marks.

Try it first. About 10 minutes for 5 marks. Write it out, then open the solution.

Solution

Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.

Procedure (s. 56 and the Third Schedule):

  1. A private company may apply to convert only if no security interest in its assets subsists at the time of application, and the partners of the LLP comprise all its shareholders and no one else (para 2).
  2. It files with the Registrar a statement by all its shareholders giving its name, registration number and date of incorporation, with the incorporation document and statement referred to in section 11 (para 3).
  3. The Registrar registers the documents and issues a certificate of registration stating the date of registration (para 4).
  4. If the Registrar is not satisfied with the particulars or other information furnished, he may refuse to register the LLP; an appeal against the refusal lies to the Tribunal (para 5).

Effect: the LLP informs the Registrar of Companies within fifteen days; all the company's property, rights, liabilities and undertaking vest in the LLP; and the company is deemed dissolved (para 6).

Where the 5 marks sit

#ComponentMarks
1Procedure3
2Effect2
Total5
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