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CS Professional · Compliance Management, Audit and Due Diligence · Legal Framework Governing Company Secretaries

Kiran & Co LLP, which has a private limited company as one of its two partners, starts offering Company Secretary practice services. Is Section 26 attracted?

Yes, Section 26 applies. Its Explanation says that for this section a company includes any LLP that has a company as its partner. Since Kiran & Co LLP has a company partner, it is barred from practising as Company Secretaries.

  1. ANo, an LLP is not a company and so is outside Section 26
  2. BYes, the Explanation provides that company includes an LLP which has a company as its partnerCorrect
  3. CYes, but only if the company holds a majority of the profit share
  4. DNo, because the LLP's other partner is an individual

Explanation

The Explanation to Section 26 clarifies that company includes any limited liability partnership which has a company as its partner. Kiran & Co LLP has a company as a partner, so the bar applies. The Explanation sets no profit-share condition and does not depend on the other partner's status.

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