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CS Executive · Setting Up of Business, Industrial and Labour Laws · Conversion of Business Entities

Under Section 374 of the Companies Act, 2013, a limited liability partnership registers as a company under that Part. Which statement correctly describes its status under the LLP Act, 2008 after registration as a company?

Upon registration as a company, an LLP is deemed to be dissolved under the LLP Act, 2008 without any further act or deed, by virtue of the proviso to Section 374 of the Companies Act, 2013. No separate winding up or closure filing is needed for dissolution.

  1. AThe LLP is deemed to have been dissolved under the LLP Act without any further act or deedCorrect
  2. BThe LLP continues to exist alongside the company until its partners file Form for closure
  3. CThe LLP must be wound up by the Tribunal before registration is complete
  4. DThe LLP stays dissolved only if the Registrar of Firms issues a certificate

Explanation

The proviso to Section 374, inserted in 2018, states that upon registration as a company under this Part, an LLP shall be deemed dissolved under the LLP Act without any further act or deed. The other options require extra steps the proviso does not impose, so they are wrong. The affidavit in clause (c) applies to other entities generally.

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