customersuccess@taxmantra.com
+91 9230033070 
Toll Free: 
Contact Us
The Ministry of Corporate Affairs has clarified that a HUF or its Karta cannot become Partner or designated partner in LLP. Earlier to this clarification, HUF and its Karta were becoming the partners in LLP. But with this clarification, HUF/ Karta cannot be a Partner in LLP.
A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have limited liabilities. LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership.
Every LLP shall be required to have atleast two Designated Partners who shall be individuals and at least one of the Designated Partner (DP) shall be a resident of India.
Any individual or body corporate may be a partner in a LLP. However an individual shall not be capable of becoming a partner of a LLP, if—
(a) he has been found to be of unsound mind by a Court of competent jurisdiction and the finding is in force;
(b) he is an undischarged insolvent; or
(c) he has applied to be adjudicated as an insolvent and his application is pending.
As per section 5 of LLP Act, 2008 only an individual or body corporate may be a partner in a Limited Liability Partnership. A HUF cannot be treated as a body corporate for the purposes of LLP Act, 2008. HUF or its Karta cannot be Partner in LLP.
In regards to the Designated Partner/ Partner in LLP, the major concern is HUF. A clarification has been provided in the Circular No. 13/2013 that a HUF or its Karta cannot become designated partner in LLP.
There has been ambiguity in the clarification provided that whether HUF or its Karta can become Partner or not. As in the clarification, only Designated Partner was mentioned. Therefore, it has again been clarified by the Ministry of Corporate Affairs via Circular No. 2/2016 dated 15th January, 2016 that a HUF or its Karta cannot become Partner or designated partner in LLP.
Download the Circular.
Get your LLP incorporated now.
______________________________________________________