A Limited Liability Partnership must follow the procedure for adding a partner as per Section 7 of the LLP Act 2008.

There are various reasons for the addition of a partner in a Limited Liability Partnership. It could be for the following reasons:

•  Capital Investment
• Retirement of existing partner 
• Change in role and responsibilities of LLP 
• For Business Expansion 
• Mutual consent of Partners 
• Family-run LLP Business

The following procedure is followed for adding a partner in an LLP:

Step 1: Pass a resolution for Adding a Partner 

The Company Board must pass the Board resolution after conducting a meeting with a partner. This Resolution for admission of Partner authorizes existing partner to act on behalf of LLP & all Partners. Current and remaining partners, empowered for legal formalities, must have a valid DSC and DIN Number. Essentials for the document of such Resolution for admission of a partner are:

1. Execute Resolution on Letter Head of LLP.

2. Resolution of the required signature of current partners and authorized partners.

3. Details about the subject matter.

4. Affix Stamp of LLP. 

Step 2: Execute Amendment to LLP Agreement 

LLP carries transactions as per the terms and conditions of the agreement. It is a source document, having information about Capital, Profit & loss sharing ratio, roles & responsibilities of Partners, etc. The supplement LLP Deed Agreement is executable through an existing partner and a new partner. This agreement may have data about the partner’s capital, functions, duties, etc.

Check LLP Format for adding a partner. 

• It should contain terms & conditions regarding the admission of Partner. 
• Old LLP agreement is amendable through Supplementary agreement.
• If there is no change in the capital, this agreement is executable on a Hundred rupees stamp paper.
• If there is a variation in the capital contribution of LLP, then the bond value is applied as per Stamp Act provisions. 
• This supplementary agreement shall have a sign of an existing partner and a new partner.

Step 3: File Form – 4 and Form - 3

Form 4 of LLP  requires online filing to the Ministry of Corporate Affairs for intimation of Change in Partner of LLP. This form requires a digital signature by the use of the DSC of an existing partner. 

Form-4 emphasizes a change in name/ address/ designation and appointment of a designated partner or partner and consent to become a partner/designated partner/ Notice of Appointment, cessation, change in name/ address/ designation. Practicing Chartered Accountant or Company Secretary or CMA require a Certification of Form 4.

After filing this form, FORM – 3 must be filed, along with the ancillary documents and the original partnership deed.

This Article Does Not Intend To Hurt The Sentiments Of Any Individual Community, Sect, Or Religion Etcetera. This Article Is Based Purely On The Authors Personal Views And Opinions In The Exercise Of The Fundamental Right Guaranteed Under Article 19(1)(A) And Other Related Laws Being Force In India, For The Time Being.