LLP (Amendment) Rules, 2023 – Revised LLP Form No.3

The Ministry of Corporate Affairs (MCA) has issued the Limited Liability Partnership (Amendment) Rules, 2023, through a notification dated June 2, 2023. These rules amend the existing Limited Liability Partnership Rules, 2009. The LLP (Amendment) Rules, 2023, became effective upon publication in the Official Gazette. One of the fundamental changes introduced by this amendment is the revision of LLP Form 3, which pertains to "Information concerning Limited Liability Partnership Agreement." This article gives complete information on Form 3 LLP, procedure, fees, and penalty/

Synopsis of LLP (Amendment) Rules, 2023

Under the current regulations, every LLP must submit information about the LLP agreement by filing Form No.3 with the Registrar of Companies (ROC) within 30 days of incorporation. With the LLP (Amendment) Rules, 2023, the MCA has introduced additional disclosure requirements in Form No.3. Specifically, if the nominee is a body corporate, the form must now include additional information such as the type of body corporate and details of the LLPIN/CIN/FLLPIN/Other Identification Number associated with it. This amendment aims to enhance LLPs' transparency and reporting standards by ensuring comprehensive information regarding the LLP agreement. These changes will assist in maintaining accurate records and facilitating regulatory compliance.

Limited Liability Partnership (LLP)

The Limited Liability Partnership (LLP) is a legal business organization that combines features from partnerships and corporations. Within an LLP, partners have limited personal responsibility for the debts and liabilities of the business. For more details on LLP, click here.

What is LLP Form 3?

LLP Form 3 is a webform designed to simplify the application process for Limited Liability Partnerships (LLP) regarding the filing of information with the Registrar of Companies (RoC). Through this form, users can submit details related to the LLP Agreement and any subsequent changes to the LLP agreement. The form ensures that the necessary information about the LLP's structure and terms is accurately recorded, streamlining compliance with RoC regulations.

LLP Form No.3 - Information concerning Limited Liability Partnership Agreement

LLP Form No.3 is used in Limited Liability Partnerships (LLPs) to provide relevant information regarding the LLP agreement or any modifications made.

Purpose of Filing LLP Form No.3

Purpose 1: Filing Form 3 LLP for LLP Incorporation

LLPs are required to file Form 3 LLP with the Registrar within thirty days of the date of incorporation. This one-time filing needs to be completed after the LLP is incorporated. Filing Form 3 LLP under Purpose 1 is to provide essential information about the LLP, ensuring compliance with regulatory requirements.

Purpose 2: Filing Form 3 LLP for Changes in LLP Agreement

LLPs must also file Form 3 LLP with the Registrar within thirty days of any changes made in the LLP Agreement. This includes modifications, amendments, or updates to the existing LLP Agreement. Filing Form 3 LLP under Purpose 2 allows LLPs to notify the Registrar about the changes in the LLP Agreement and update the relevant information. As mentioned above, LLP Form 3 can be filed under Purpose 2 for various reasons related to changes in the Limited Liability Partnership (LLP). The following purposes outline the specific scenarios for which LLP Form 3 can be filed:

Change in business activities: If there is a modification or alteration in the business activities conducted by the LLP, LLP Form 3 should be filed to notify the Registrar about this change.
Change in partner(s): In case there are any changes in the partners of the LLP, such as the admission of a new partner or resignation of an existing partner, LLP Form 3 must be filed to update the Registrar with the updated partner information.
Change in partner's contribution and % of profit sharing: If there are amendments in the contribution amount or percentage of profit sharing among the partners, filing LLP Form 3 is necessary to reflect these changes.
Change due to other reasons: This category encompasses any other changes within the LLP apart from the scenarios above. If there are modifications in the LLP Agreement or any further relevant details, LLP Form 3 should be filed to report these changes to the Registrar.

By filing LLP Form 3 under Purpose 2 for the appropriate scenario, the LLP can ensure that the Registrar is informed about any significant changes within the LLP's structure, operations, or partnership. By submitting the appropriate Form 3 LLP under the respective purposes, LLPs can fulfill their obligations and maintain compliance with the regulatory framework governing LLPs in the jurisdiction.

Filing LLP Form 3 for LLP Incorporation and Changes in LLP Agreement

As mentioned above, the form is divided into sections, allowing for the appropriate filling based on the purpose. Regardless of the purpose, specific basic details must be provided:

The Limited Liability Partnership identification number (LLPIN)
The name of the LLP
The address of the registered office
The jurisdiction of the police station
email ID

Section 1: Initial LLP Agreement

If you are entering into the initial LLP agreement, you should complete the first section of the LLP Form No.3. This section requires the following information:

Name of the LLP
Address of the registered office
Jurisdiction of the police station
Email ID
Business activities to be conducted upon incorporation
Contribution Obligation
Mutual rights and duties of partners
Any restrictions on partners' authority
Details regarding the admission, retirement, expulsion, cessation, and resignation of partners
Procedures for calling, holding, and conducting meetings where partners make decisions.
Please ensure all the details in Section 1 are accurately filled out in the LLP Form No.3 for the initial LLP agreement.

Section 2: Modifications to Existing LLP Agreement

If you already have an existing LLP agreement and wish to make modifications, you should fill out the second section of the LLP Form No.3. This section requires the following details:

Date of modification: Specify the date when the LLP agreement was modified.
Several amendments or modifications: Indicate the total number of changes made to the LLP agreement thus far.
SRN (Service Request Number): Provide the SRN of Form 4 or Form 5 submitted within the last year. This SRN represents the filing through which the change or amendment in the LLP agreement was notified to the Registrar.
Ensure you accurately provide the required information in Section 2 of the LLP Form No.3 when modifying an existing LLP agreement.

Additional disclosure requirements Revised Form No.3 - LLP (Amendment) Rules, 2023

With the introduction of the LLP (Amendment) Rules, 2023, the Ministry of Corporate Affairs (MCA) has imposed additional disclosure requirements in Form No.3. These requirements aim to enhance transparency and ensure comprehensive information. Notably, suppose the nominee happens to be a corporate body. In that case, the form must now include specific details such as the type of corporate body and the associated LLPIN/CIN/FLLPIN/Other Identification Number. In the new version of Form 3, Table 19(a) captures the following details:

Whether Body Corporate Partner (Yes/No): Indicating whether the partner is a body corporate or not.
DPIN/Income Tax PAN/Passport number of the partner/nominee: The unique identification number of the partner or nominee, which may be a DPIN, Income Tax PAN, or Passport number.
Details of DIN/Income Tax PAN/Passport number: Additional information related to the partner or nominee's DIN, Income Tax PAN, or Passport number.
Name of Individual Partner / Nominee of Body Corporate: The individual partner or nominee representing the body corporate.
Type of Body Corporate: Specifying the kind of corporate body associated with the partner.
LLPIN/CIN/FCRN/FLLPIN/Other Identification Number: Referring to the identification number of the LLP, such as LLPIN, CIN, FCRN, FLLPIN, or any other relevant identification number.
Details of LLPIN/CIN/FCRN/FLLPIN/Other Identification Number: Further information about the LLPIN, CIN, FCRN, FLLPIN, or other identification number mentioned above.
Name of Body Corporate: The corporate name is associated with the partner.
Designation (Partner/Designated Partner): Indicating the partner's designation as either a partner or a designated partner.
Form of contribution (Conversion/Cash/Other than cash): Specifying the form of the contribution made by the partner, which can be in the form of conversion, money, or other than cash.
The monetary value of contribution: The economic value or amount of the partner's contribution.
% of Profit sharing: The percentage of profit sharing assigned to the partner.
Type of change (Addition/Deletion/Change/No Change): Identifying the type of change being reported for the partner, whether it is an addition, deletion, change, or no change.

These details captured in Table 19(a) of Form 3 provide comprehensive information about the partner or nominee, their contribution, profit sharing, and any changes related to their involvement in the LLP. By incorporating these additional requirements, the MCA aims to improve the accuracy and completeness of the information provided in the form. Form No. 3 is an essential document for LLPs, enabling them to provide information about their agreement or its modifications. By accurately completing the form, LLPs can ensure compliance with regulations and maintain updated records with the Registrar of Companies.

Form 3 of LLP Fees

The fees associated with Form 3 of LLP are determined by the total contribution made by the partners to the LLP. The fee structure is tiered, with higher contributions leading to increased fees. It's important to note that the specific amounts may vary over time, so it's advisable to consult the latest government guidelines.

Penalty for Non-Filing Form 3 LLP

Failure to file Form 3 LLP within the prescribed timeframe results in a late fee penalty. The amount of the penalty varies depending on the duration of the delay and the size of the LLP. Small LLPs face a lower penalty compared to other LLPs. The penalty increases progressively with the length of the delay, ranging from 1 times the normal filing fee for up to 15 days to 50 times the normal filing fee for delays exceeding 360 days. It's crucial to adhere to the filing deadlines to avoid financial penalties and potential legal consequences.