Skip to content

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

Kabir and Meera run a consultancy through a registered LLP, Nirmaan Consultants LLP. A supplier sues the business for an unpaid bill. Which statement about the legal status of the LLP is correct?

An LLP is a body corporate with a legal personality separate from its partners. It can therefore sue and be sued in its own name, own property and enter contracts. The supplier can proceed against the LLP itself, not merely against Kabir and Meera.

  1. AThe LLP is a body corporate with a legal personality separate from its partners, so it can sue and be sued in its own nameCorrect
  2. BThe LLP has no separate existence, so the supplier must sue Kabir and Meera personally as the only parties
  3. CThe LLP is a body corporate only for tax purposes and a firm for all other purposes
  4. DThe LLP can sue but cannot be sued, since only its partners bear liability

Explanation

Under the LLP Act, 2008, an LLP is a body corporate and a legal entity separate from its partners. It can therefore sue and be sued in its own name. The second option describes an ordinary partnership firm, not an LLP.

Did you get it right without looking?

One question tells you little. A timed set on The Limited Liability Partnership Act, 2008 shows your real accuracy, how long you take and where you lose marks.

Practise The Limited Liability Partnership Act, 2008Free diagnostic mock

More The Limited Liability Partnership Act, 2008 questions