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CS Executive · Setting Up of Business, Industrial and Labour Laws · Limited Liability Partnership

Alpha LLP and Beta LLP are being amalgamated under a Tribunal-sanctioned scheme. Beta LLP, a transferor, is to be dissolved without winding up. Which condition must be met before the Tribunal orders this dissolution?

Before the Tribunal dissolves a transferor LLP without winding up, the Official Liquidator must scrutinise its books and papers and report that its affairs were not conducted in a manner prejudicial to its partners or to public interest.

  1. AThe Registrar must approve the name of the transferee LLP
  2. BThree-fourths of the partners of the transferee must be designated partners
  3. CThe Official Liquidator must report, after scrutinising its books and papers, that its affairs were not conducted prejudicially to partners or public interestCorrect
  4. DA company must be a party to the amalgamation

Explanation

The second proviso to section 62(1) bars a dissolution order under clause (iii) unless the Official Liquidator reports after scrutiny that affairs were not conducted in a prejudicial manner. A company cannot be amalgamated with an LLP, so the last option is wrong.

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