Who can be appointed a designated partner, and the procedure

Who can be appointed (s. 7):

1. Every LLP must have at least two designated partners who are individuals, at least one of them resident in India. "Resident" meant, when this paper was set, a person who had stayed in India for at least 182 days during the immediately preceding one year (Explanation to s. 7); the requirement is now 120 days during the financial year.
2. Where some or all partners are bodies corporate, at least two individuals who are partners or nominees of the bodies corporate act as designated partners.
3. Partner disqualifications (proviso to s. 5): an individual partner who is to be a designated partner must first be capable of being a partner, and an individual cannot become one if a competent court has found him to be of unsound mind and that finding stands, if he is an undischarged insolvent, or if his own application to be adjudicated insolvent is pending. In addition, rule 9(1) of the LLP Rules, 2009 bars a person from being appointed a designated partner if he (a) has been adjudged insolvent within the preceding five years; (b) suspends, or has within the preceding five years suspended, payment to his creditors without making a composition with them in that time; (c) has been convicted of an offence involving moral turpitude and sentenced to at least six months' imprisonment; or (d) has been convicted of an offence involving section 30 of the Act. The Central Government may remove the disqualification under (a) or (b) by notification (rule 9(2)).

Procedure of appointment:

1. Designation (s. 7(2)): persons named as designated partners in the incorporation document become designated partners on incorporation (or every partner does, if the document says so); afterwards a partner may become, or cease to be, a designated partner in accordance with the LLP agreement.
2. The individual gives his prior consent to act as designated partner, in the prescribed form and manner (s. 7(3)).
3. The LLP files his particulars with the Registrar, in the prescribed form and manner, within thirty days of his appointment (s. 7(4)).
4. He satisfies the prescribed conditions and obtains a Designated Partner Identification Number (s. 7(5), (6)). Under rule 10(1) of the LLP Rules, 2009, as it now stands (substituted in 2018), an individual who is to be appointed designated partner of an existing LLP applies electronically in Form DIR-3 to obtain the DPIN, and a Director Identification Number (DIN) is sufficient for the appointment.
5. On a vacancy the LLP may appoint a new designated partner within thirty days, s. 7(4) (filing) and s. 7(5) (the prescribed conditions) applying to him; if none is appointed, or only one designated partner remains, every partner is deemed a designated partner (s. 9).