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CA Foundation · Business Laws · The Limited Liability Partnership Act, 2008

Dev Textiles LLP was formed by Pooja and Qadir. Qadir is a nominee of no one and acts for himself. A friend says that the Indian Partnership Act, 1932 governs the LLP's internal affairs by default. Which statement is correct?

The Indian Partnership Act, 1932 does not apply to an LLP. An LLP is governed by the Limited Liability Partnership Act, 2008, along with the rules made under it and the LLP agreement between the partners, and it is not an ordinary partnership firm.

  1. AThe Indian Partnership Act, 1932 applies to every LLP automatically
  2. BThe Indian Partnership Act, 1932 does not apply to LLPs, and the LLP Act, 2008 governs themCorrect
  3. CThe Companies Act, 2013 governs every LLP in full without exception
  4. DThe Indian Contract Act, 1872 alone governs LLPs and the LLP Act does not apply

Explanation

The LLP Act states that the provisions of the Indian Partnership Act, 1932 do not apply to LLPs. LLPs are governed by their own Act, the LLP agreement and rules made under it. The Companies Act does not govern LLPs automatically in full.

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