Incorporations

Limited Liability Partnership (LLP)

LLP formation, at an all-inclusive price, including Government Fees and applicable Stamp Duty*

Complete By* : 18 Mar, 2024

Pricing Summary

Traditional CA/CS Price : ₹ 12,500 /-

Other Online Price : ₹ 8,000 /-

Our Base Price : ₹5,609 /-

Govt. fees & taxes : ₹1,891 /-

You Pay: 7,500/- all inclusive

Government Fee included in above

You Save : ₹500/- to 5,000 /-

What do you get?

15 Mins free Consultation with an EXPERT

Name Reservation

DIN for 2 (two) Designated Partners* (Indian citizen

Drafting of LLP Agreement

Printable copy of LLP Agreement (pdf format)

ePAN, eTAN

LLP Registration with contribution of 1 Lakh

IPro*– basic secretarial data entry done for no time lag, if Annual Compliance Package purchased.

[*Software for Company Law and related compliances]

Why Should You Choose SeedUp for

Registering your Limited Liability Partnership?

SAVINGS

in cost, most economica

FASTEST

completion of assignment

ADHERENCE

to compliances, giving you all that matters

RESPONSIBLE

towards your specific requirements

HASSLE FREE

we only ask for required documents

Conceptual understanding of LLP?

  1. Mutual rights and duties of the partners within an LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. Since an LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’, an LLP is a hybrid between a company and a partnership.
  2. LLP is an alternative business structure that has taken the best features from the Company and partnership form of business entity- limited liability of a company and the flexibility of a partnership.
  3. The LLP perpetual succession, irrespective of changes in partners. It is capable of entering into contracts and holding property in its own name.
  4. The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP.
  5. No one partner is liable on account of the independent or un-authorised actions of other partners. Thus, individual partners are not to be held liable for another partner’s wrongful business decisions or misconduct.The LLP, will, however be liable for its obligations as a separate entity.

Documents Required

PAN Card

Utility Bill (Telephone, Electricity)

Aadhaar Card

Bank Statement

Passport Size Photo

Incorporation

Limited Liability Partnership (LLP)

Another popular form of a business structure is an LLP (Limited Liability Partnership. Since LLP contains elements of both ‘a corporate structure’ as well as ‘a partnership firm structure’ LLP is called a hybrid between a company and a partnershi

Process for Incorporation

Collect information and documents

File RUN-Name Reservation

File FiLLiP-LLP Incorporation

Resubmissions, if any clarifications required by MCA

Incorporation Certificate (Digital)

Drafting of LLP Agreement

File E-form LLP-3

e-PAN, e-TAN

Note: Digital signatures must be obtained for all proposed designated Partners(s) and partner(s) of the company. It is required for signing of the incorporation application.

DSC can be obtained online. Your SeedUp support manager will submit the application and generate a link to complete video eKYC verification. The applicant would have to take a short video and verify OTP to authenticate the application.

Important features of

Limited Limited Partnership

The Ministry of Corporate Affairs- a Central government Ministry is primarily concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability Partnership Act, 2008 & other allied Acts and rules & regulations framed thereunder, mainly for regulating the functioning of the corporate sector in accordance with law.

Separate Legal Entity

The LLP has a distinct identity of a legal juristic person with it own PAN. It is separate from its partners.

Perpetual

A limited liability partnership shall have perpetual succession.

Liability

The word ‘limited’ is used to convey the message to public at large that the liability of the LLP and it Partners, is limited- Any change in the partners of limited liability partnership shall not affect the existence, rights or liabilities of the limited liability partnership. The LLP is a separate legal entity, is liable to the full extent of its assets but liability of the partners is limited to their agreed contribution in the LLP. Further, no partner is liable on account of the independent or un-authorised actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct. Mutual rights and duties of the partners within a LLP are governed by an agreement between the partners or between the partners and the LLP as the case may be. The LLP, however, is not relieved of the liability for its other obligations as a separate entity

Funding

Owned funds. Debt funds can be managed. For startups, Investors do not like to invest in this type of business entity, as investing at various valuation points is difficult.

Limited Liability Partnership vis a vis other business structures

Parameter

Sole Proprietorship

Partnership

One Person Company (OPC)

Limited Liability Partnership (LLP)

Private Limited Company 

Statute

Common Law

Common Law – unregistered

Indian Partnership Act, 1932- registered

Companies Act, 2013

Limited Liability Partnership Act, 2008

Companies Act, 2013

Ownership

The Proprietor- an individual

Minimum 2 partners ( a company can be a partner)

Division of Labour-

O/ship- Promoter (only one)

Daily working- Board of Director(s) (OPC may have more than 1 director)

Division of Labour-

O/ship- All partners

Daily working- Designated Partners

Division of Labour-

O/ship- Promoters and shareholders

Daily working- Board of Directors (at least 2 directors)

Legal identity & Liability

No distinct PAN.

No separate legal entity. Proprietor to bear all liabilities.

 

Distinct PAN.

No separate legal entity from its partners. Private assets of the partners can be used to meet the liabilities of the firm in case firm's assets are not adequate to meet its liabilities.

Distinct PAN

Separate legal entity

Limited Liability. Personal property does not get attached

 

Distinct PAN

Separate legal entity

Limited Liability. Personal property does not get attached

 

Distinct PAN

Separate legal entity

Limited Liability. Personal property does not get attached

 

Funding

Owned funds. Difficult for bank loans. Collateral of personal assets.

Owned funds. Difficult for bank loans. Collateral of personal assets.

Owned funds or debt. Cannot raise or offer equity

Owned funds. Debt funds can be managed.

For startups, Investors do not like to invest in this type of business entity

Best option if looking for business expansion I long run. Both Debt and Equity permitted. 

Costs:

  

Incorporation

NIL

Very minimal.

If registered, then cost for registration. May go upto 10000/-

Presently greatly reduced. CG charges- NIL upto 15 Lakhs

Stamp Duty payable to State Governments ranging from 200/- to 10000/-

Very minimal.

Presently greatly reduced. CG charges- NIL upto 15 Lakhs

Stamp Duty payable to State Governments ranging from 200/- to 10000/-

Recurring

Trade license

Trade License

Tax Audit depending on Turnover

Filing of Forms

Auditor Fees

ITR filing fees

Other business registrations

Filing of Forms

Auditor Fees- if Turnover exceeds 40 Lakhs

ITR filing fees

Filing of Forms

Auditor Fees

ITR filing fees

Other business registrations

Taxation

Depends on personal tax slabs

Taxed at 30%. Remuneration

paid to partners can be

claimed as deduction,

restricted to the limits

speci‑ed (under the IT Act).

MAT does not apply.

No general advantages

(industry specific advantages are available). Tax to be paid at flat rate of 30% on profits, Dividend taxable in hand of receiver.

Minimum

Alternate Tax (MAT) applicable

No general advantages

(industry specific advantages are available). Tax to be paid at flat rate of 30% on profits. MAT is applicable.

Taxes on Income The following rates are applicable to the domestic companies for AY 2020-21 based on their turnover (excluding cess & surcharge): 

 

Sections

Tax rate

Surcharge

Section 115BA (Applicable Manufacturing Domestic Companies

25%

7%/12%*

Section 115BAA (applicable domestic companies)

22%

10%

Section 115BAB (manufacturing)

15%

10%

Any other case

30%

7%/12%*

Dividend taxable in hand of receiver. Minimum

Alternate Tax (MAT) applicable

Going Concern

Not survive if proprietor departs

Departure of any partner brings it to an end

Nominee is mandatory to be appointed. It will continue

It will continue even if a partner departs

It will continue as it has perpetual succession.

LLP across the world

India is poised at a juncture where service, retail, trade, manufacturing- all these sectors will be seeing exponential growth. In view of all this, the LLP framework could be used for many enterprises, such as:-

• Persons providing services of any kind

• Enterprises in new knowledge and technology based fields where the corporate form is not suited.

 

Contd…

Contd…

• For professionals such as Chartered Accountants (CAs), Cost and Works Accountants (CWAs), Company Secretaries (CSs) and Advocates, etc.

• Venture capital funds where risk capital combines with knowledge and expertise

• Professionals and enterprises engaged in any scientific, technical or artistic discipline, for any activity relating to research production, design and provision of services.

• Small Sector Enterprises (including Micro, Small and Medium Enterprises)

• Producer Companies in Handloom, Handicrafts sector

Entities which have objectives like “charitable or other not for profit objectives” will not be able to set up an LLP as the essential requirement for incorporation of an LLP is ‘carrying on a lawful business with a view to profit’.

 

World view and Indian LLP laws

The LLP structure is available in countries like the United Kingdom (UK), United States of America (USA), various Gulf countries, Australia and Singapore. 

 

The desirability of LLP form has been expressed as being immensely beneficial to the MSME sector by :-

• Bhat Committee (1972);

• Naik Committee (1992);

• Expert Committee on Development of Small Sector Enterprises headed by Sh. Abid Hussain in 1997 and

• Study Group on Development of Small Sector Enterprises (SSEs) headed by Dr. S P Gupta (2001).

 

The following Committees set up by the Ministry of Company Affairs (MCA) have also recommended for legislation on LLPs:-

• Committee on Regulation of Private Companies and Partnerships headed by Sh. Naresh Chandra (2003)

• The Committee on New Company Law (Dr. J.J. Irani Committee) (2005)

 

On the advice of experts who have studied LLP legislations in various countries, the Indian Limited Liability Partnership Act, 2008 is based on the UK LLP Act, 2000 and Singapore LLP Act, 2005. 

 

The Ministry of Corporate Affairs- a Central government Ministry is primarily concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability Partnership Act, 2008 & other allied Acts and rules & regulations framed thereunder, mainly for regulating the functioning of the corporate sector in accordance with law.

 

Advantages of registration of Limited Liability Partnership (LLP) in India

 

With company structure like Private Limited Company and Public Limited Company or Partnership form, why should you go with a Limited Liability Partnership registration in India? LLP is easier to set up with lesser compliance and simple day to day operations. Among the various advantages of incorporation of Limited Liability Partnership (LLP) in India, few of them are :

 

Lesser cost of incorporation

In comparison to incorporation of Private limited company, Limited Liability Partnership (LLP) in India is not only easier to setup, but also cost effective. Not only is the cost of incorporation lesser but also the cost of compliance is also significantly low.

 

No minimum Capital requirements

In an LLP, there is absolutely no requirement for minimum capital. The contribution of any partner towards the capital of the LLP may also include and tangible or intangible, movable or immovable property.

 

No limit on Number of Partners

While minimum 2 partners are required to form a Limited Liability Partnership (LLP) in India, there is absolutely no limit on the maximum number of partners.

 

Tax Audit Requirements

Unlike Companies, be it Private Limited or Public Limited, where the audit is mandatory irrespective of capital requirements, in Limited Liability Partnership (LLP), such requirement starts only with capital contributions exceeding Rs.25 lakhs or annual turnover exceeding Rs.40 lakhs.

 

Income tax

LLP, for the purpose of taxation, is just like a partnership firm. It is required to pay Income Tax at the rate of 30% instead of Corporate Tax Rate of 25%. Moreover, interest paid to partner (not more than 12%), salary or bonus or commission for the actual work done by working partner is allowed for deduction from the profits.

 

Annual Compliance

Similar to other company structures, LLP also need to complete annual compliance that includes Income Tax Returns and Financial Statements and Annual Return filings at the end of each year. Penalties upto Rs.100/- per day are applicable in case of any delay in filing these returns.

 

No Equity shareholding 

A Limited liability partnership or LLP cannot sell-off its to any other person or company. Thus funding avenues like venture capital or private equity capital may not be used in this case. However LLP may always raise capital from existing or new partners or from bank through loans.

 

Limited Liability

Limited Liability Partnership or LLP is superior to a Partnership in terms of limiting the liabilities of the partners. It frees the partners of the fear of being responsible for someone else’s misconduct.

Limited Liability Partnership Agreement

Limited Liability Partnership Agreement means any written agreement between the partners of the limited liability partnership or between the limited liability partnership and its partners which determines the mutual rights and duties of the partners and their rights and duties in relation to that limited liability partnership.

 

Basic content of an LLP Agreement:

Name of LLP

Registered Office

Partners

Designated Partners

Object of LLP

Contribution of partners

Profit sharing of Partners

Provisions relating to partners

Provisions relating to designated partners

Daily working of LLP

Auditors and Accounts

Miscellaneous provisions 

Winding up

Information required while Incorporation of an LLP

Name of the limited liability partnership;

Proposed business of the limited liability partnership;

Address of the registered office of the limited liability partnership;

Name and address of each of the persons who are to be partners of the limited liability partnership on incorporation;

Name and address of the persons who are to be designated partners of the limited liability partnership on incorporation;

 

Name of Limited Liability Partnership (LLP)

Every limited liability partnership shall have either the words limited liability partnership or the acronym LLP as the last words of its name. No limited liability partnership shall be registered by a name which, in the opinion of the Central Government is

  • undesirable; or
  • identical or too nearly resembles that of any other limited liability partnership or a company or a registered trademark of any other person under the Trade Marks Act, 1999.

 

Name of LLP can be reserved for a period of 3 months from the date of intimation by the Registrar. However, Foreign LLP/Companies have an option to reserve their existing names, under which they are operating outside India, for a period of 3 years in India, which can be further renewed on application.

 

Important points applying for reservation of name of an LLP:

It is important to be very careful while applying for reservation of name of an LLP, as  there can be rejection of name approval application in the following cases if:

  1. the name is one prohibited under the Emblems and Names (Prevention of Improper Use) Act, 1950.
  2. it includes any word or words which are offensive to any section of the people;
  3. the proposed name is the exact Hindi or English translation of the name of an existing limited liability partnership in English or Hindi, as the case may be;
  4. the proposed name has a close phonetic resemblance to the name of a LLP in existence, for example, J.K. LLP., Jay Kay LLP;
  5. it includes the word Co-operative, Sahakari or the equivalent of word "co-operative" in the regional languages of the country;
  6. it connotes the participation or patronage of the Central or State Government, unless circumstances justify to, e.g., a name may be deemed undesirable in certain context if it includes any of the words such as National, Union, Central, Federal, Republic, President, Rashtrapati, etc;
  7. the proposed name contains the words "British India";
  8. the proposed name implies association or connection with any Embassy or Consulate or of a foreign Government which suggests connection with local authorities such as Municipal, Panchayat, Zila Parishad or any other body connected with the Union or State Government;
  9. it is different from the name or names of the existing limited liability partnership only to the extent of having the name of a place within brackets before the word "limited liability partnership", for example, Indian Press (Delhi) LLP should not be allowed in view of the existence of the LLP named Indian Press LLP;

Provided that the name shall be reserved, in case the "No Objection Certificate" is granted by the registered Limited Liability Partnership of company, as the case may be.

  1. it includes name of registered Trade mark, unless the consent of the owner of the trade mark has been produced;
  2. the proposed name is identical with or too nearly resembles the name of any other limited liability partnership or a company
  3. it is identical with or too nearly resembles the name of the limited liability partnership or a company in liquidation or it is identical with or too nearly resembles names of the LLP or a company which is struck off, up to the period of 5 years;
  4. it includes words like ‘Bank’, ‘Insurance’, and ‘Banking’, ‘Venture capital’ or ‘mutual fund’ or business activity includes the words like ‘Bank’, ‘Insurance’, and ‘Venture capital’ or ‘mutual fund’ or such similar names without the approval of regulatory authority:

Provided that the approval of regulatory authority shall be obtained at the time of application for incorporation or change of name of an existing Limited Liability Partnership, as the case may be.

  1. the proposed name includes words like French, British, German, etc., unless the partners satisfy that there is some form of collaboration and connection with the foreigners of that particular country or place, the name of which is incorporated in the name;
  2. the proposed name of limited liability partnership includes the words Company Secretary, Chartered Account, advocates or such similar words as indicative of a profession, as part of the proposed name, the same shall be allowed only after obtaining approval from the Council governing such profession or such authority as may be nominated by the Central Government, in this behalf.

Provided that the approval of the council governing the profession shall be obtained at the time of application for incorporation or change of name of an existing Limited Liability Partnership, as the case may be.

 

Name reservation by Foreign LLP

A foreign LLP or a foreign company can  apply to the Registrar for reserving its existing name by which it is registered in the country of its regulation or incorporation. Generally,such reservation is valid for three years but may be renewed on a fresh application along with payment of requisite fees.


 

How to apply for Company Name Reservation and pertinent information

2 names can be applied for in RUN along with applicable industry/business activity. Select the NIC activity (2 digit) as applicable to the Company under incorporation. The meaning of the name has to be given. If name in regional language or any other language, then complete explanation for the name required. It has to be checked that the desired name does not trigger any name under the trademark check or with an existing company name.

 

Sometimes, clarifications are required to be given against specific queries raised by the MCA. If the name is not approved in the first instance, then it can be resubmitted only one more time with more names. 

 

Initially,shall be valid for a period of 3 months from the date of approval. If the proposed LLP is not incorporated within such period, the name shall lapse and will be available for other applicant/ LLP.

 

Proposed Business of the Limited Liability Partnership

The proposed business of theLLP has to be be reflected in the name of the LLP. Further, it has to be selected from the  NIC 2008 activity (2 digit) . 3 (Three) NIC codes can be selected for one name. These business activities shall also be made part of the LLP Agreement.


 

Address of the Registered Office of the Limited Liability Partnership

The Registered Office of an LLP refers to the principal business address and the official correspondence address. The address of the Registered Office will be used on all official communications of the LLP. Unlike a Company which at the time of incorporation has the option to give either the registered office address or a correspondence address, an LLP has to mandatorily provide required documents of address proof for registered office, at the time of registering a new LLP

 

It has been provided in the Act that a document may be served on a LLP or a partner or designated partner by sending it by post or by any other mode (to be prescribed under Rules) at the registered office and any other address specifically declared by the LLP for the purpose in such form and manner as may be prescribed (in the rules). Thus, an LLP shall have the option to declare one more address (other than the registered office) for getting statutory notices/letters etc. from the Registrar of Companies.

 

Partners of LLP

Minimum and maximum number of partners in an LLP?

A minimum of two partners will be required for formation of an LLP. There is no limit to the maximum number of partners. As per section 5 of the LLP Act, a Body corporate can become a partner of an LLP. An HUF cannot be a partner (a Karta cannot be a partner as he represents the HUF and an HUF is not a ’body corporate’).

Any individual or body corporate may be a partner in a LLP. However an individual shall not be capable of becoming a partner of a LLP, if—

(a) he has been found to be of unsound mind by a Court of competent jurisdiction and the finding is in force;

(b) he is an undischarged insolvent; or

(c) he has applied to be adjudicated as an insolvent and his application is pending.

 

Designated Partners

Minimum 2 (two) “Designated Partners” have to be appointed and maintained throughout the existence of an  LLP. “Designated Partners” shall also be accountable for regulatory and legal compliances, besides their liability as ‘partners, per-se”.

Designated Partners shall be individuals and at least one of the Designated Partner shall be a resident of India. In case of a LLP, in which all the partners are bodies corporate or in which one or more partners are individuals and bodies corporate, at least two individuals who are partners of such LLP or nominees of such bodies corporate shall act as Designated Partners.

Every Designated Partner has to obtain a “Designated Partner’s Identification Number” (DPIN) similar to “Director’s Identification Number” (DIN). 

 

Should number of designated partners resident in India be more than partners from outside India

LLPs, particularly those engaged in the services or technology-based sectors provide services globally. This may require any number of its partners to be located abroad. In view of the liability structure of partners, designated partners and LLP, clearly provided for in the Act, there does not appear to be any necessity and justification for restriction relating to designated partners resident in India to out-number partners located abroad. 

 

Application for DPIN

An individual who wishes to be appointed as designated partner but does not have a DPIN or DIN, application for allotment of DPIN will be made in Form FiLLiP. Application for allotment of DPIN shall not be made by more than 5 (five) individuals in Form FiLLiP

Post registration Compliances for LLP 

After the completion of the registration procedure of the LLP, the freshly incorporated LLP has the following compliances to follow:

● Filing the Partnership Agreement

● Applying for PAN and TAN

● Opening a Bank Account

 

Annual Compliance Requirements - The annual compliances are meant to be met compulsorily irrespective of whether the company has started or not, once the registration process is complete. 

● Statement of Account and Solvency

● LLP annual returns

● Income tax returns

 

Annual Accounts of an LLP

An LLP shall be under obligation to maintain annual accounts reflecting a true and fair view of its state of affairs. A “Statement of Accounts and Solvency” in prescribed form shall be filed by every LLP with the Registrar every year.

 

The accounts of every LLP shall be audited in accordance with Rule 24 of LLP, Rules 2009. Any LLP, whose turnover does not exceed, in any financial year, forty lakh rupees (or such other amount as prescribed), or whose contribution does not exceed twenty five lakh rupees (or such other amount as prescribed), is not required to get its accounts audited. However, if the partners of such limited liability partnership decide to get the accounts of such LLP audited, the accounts shall be audited only in accordance with such rule.

 

Annual Return to be filed by by an LLP

Every LLP would be required to file an annual return in Form 11 with ROC within 60 days of the close of the financial year. The annual return is available for public inspection.

 

Penalty

As per the Limited Liability Partnership Act, 2008, there is a penalty for any failure in registering Form 8 and Form 11 for the purpose of reporting the financial statements and annual returns of the LLP. For each agreement that goes unregistered, there is a fixed penalty amount of Rs. 100 per day. There isn't any maximum limit specified.

 

Income Tax Returns

Each and every registered LLP is expected to file their income tax returns along with the annual filing, which should be done by the 30th of September every year. 

 

Penalty

Any failure to do so results in a penalty of Rs. 5000 and the filing must be then completed by 31st December of the same year. In case the LLP still fails to meet the deadline, the penalty will double in amount to Rs. 1000.

Who is an NRI?

As per RBI- A ‘Non-resident Indian’ (NRI) is a person resident outside India who is a citizen of India.

 

As per Income Tax Act, 1961 "non-resident" means a person who is not a "resident", and for the purposes of sections 92, 93 and 168, includes a person who is not ordinarily resident within the meaning of clause (6) of section 6 ;

 

The word “person" includes—

(i) an individual,

(ii) a Hindu undivided family,

(iii) a company,

(iv) a firm,

(v) an association of persons or a body of individuals, whether incorporated or not,

(vi) a local authority, and

(vii) every artificial juridical person, not falling within any of the preceding sub-clauses.

 

Explanation.—For the purposes of this clause, an association of persons or a body of individuals or a local authority or an artificial juridical person shall be deemed to be a person, whether or not such person or body or authority or juridical person was formed or established or incorporated with the object of deriving income, profits or gains;

 

How to determine that an Individual is NRI?

'Non-resident Indian' is an individual who is a citizen of India or a person of Indian origin and who is not a resident of India. Thus, in order to determine whether an Individual is a non-resident Indian or not, his residential status is required to be determined under Section 6. As per section 6 of the Income-tax Act, an individual is said to be non-resident in India if he is not a resident in India and an individual is deemed to be resident in India in any previous year if he satisfies any of the following conditions:

 1.  If he is in India for a period of 182 days or more during the previous year; or

 2.  If he is in India for a period of 60 days or more during the previous year and 365 days or more during 4 years immediately preceding the previous year.

However, in respect of an Indian citizen and a person of Indian origin who visits India during the year, the period of 60 days as mentioned in (2) above shall be substituted with 182 days. The similar concession is provided to the Indian citizen who leaves India in any previous year as a crew member or for the purpose of employment outside India.

 

The Finance Act, 2020, w.e.f., Assessment Year 2021-22 has amended the above exception to provide that the period of 60 days as mentioned in (2) above shall be substituted with 120 days, if an Indian citizen or a person of Indian origin whose total income, other than income from foreign sources, exceeds Rs. 15 lakhs during the previous year. Income from foreign sources means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India).

 

An Indian citizen shall be deemed to be resident in India only if his total income, other than income from foreign sources, exceeds Rs. 15 lakhs during the previous year. For this provision, income from foreign sources means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India).

 

However, such individual shall be deemed to be Indian resident only when he is not liable to tax in any country or jurisdiction by reason of his domicile or residence or any other criteria of similar nature.

 

Thus, from Assessment Year 2021-22, an Indian Citizen earning total income in excess of Rs. 15 lakhs (other than from foreign sources) shall be deemed to be resident in India if he is not liable to pay tax in any country.

 

A person shall be deemed to be of Indian origin if he, or either of his parents or any of his grand-parents, was born in undivided India.

6. For the purposes of this Act,—

 

(1) An individual is said to be resident in India in any previous year, if he—

 

(a) is in India in that year for a period or periods amounting in all to one hundred and eighty-two days or more ; or

 

(b) [***]

 

(c) having within the four years preceding that year been in India for a period or periods amounting in all to three hundred and sixty-five days or more, is in India for a period or periods amounting in all to sixty days or more in that year.

 

Explanation 1.—In the case of an individual,—

 

(a) being a citizen of India, who leaves India in any previous year as a member of the crew of an Indian ship as defined in clause (18) of section 3 of the Merchant Shipping Act, 1958 (44 of 1958), or for the purposes of employment outside India, the provisions of sub-clause (c) shall apply in relation to that year as if for the words "sixty days", occurring therein, the words "one hundred and eighty-two days" had been substituted ;

 

(b) being a citizen of India, or a person of Indian origin within the meaning of Explanation to clause (e) of section 115C, who, being outside India, comes on a visit to India in any previous year, the provisions of sub-clause (c) shall apply in relation to that year as if for the words "sixty days", occurring therein, the words "one hundred and eighty-two days" had been substituted 30[and in case of 31[such person] having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year, for the words "sixty days" occurring therein, the words "one hundred and twenty days" had been substituted.]

 

Explanation 2.—For the purposes of this clause, in the case of an individual, being a citizen of India and a member of the crew of a foreign bound ship leaving India, the period or periods of stay in India shall, in respect of such voyage, be determined in the manner and subject to such conditions as may be prescribed.32

 

33[(1A) Notwithstanding anything contained in clause (1), an individual, being a citizen of India, having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year shall be deemed to be resident in India in that previous year, if he is not liable to tax in any other country or territory by reason of his domicile or residence or any other criteria of similar nature.]

 

A Hindu undivided family, firm or other association of persons is said to be resident in India in any previous year in every case except where during that year the control and management of its affairs is situated wholly outside India.

 

 A company is said to be a resident in India in any previous year, if—

 (i) it is an Indian company; or

(ii) its place of effective management, in that year, is in India.

Explanation- For the purposes of this clause "place of effective management" means a place where key management and commercial decisions that are necessary for the conduct of business of an entity as a whole are, in substance made.

 

Every other person is said to be resident in India in any previous year in every case, except where during that year the control and management of his affairs is situated wholly outside India.

 

NOT ORDINARILY RESIDENT

 A person is said to be "not ordinarily resident" in India in any previous year if such person is—

 

(a) an individual who has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine days or less; or

 

(b) a Hindu undivided family whose manager has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine days or less 35[; or

 

(c) a citizen of India, or a person of Indian origin, having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year, as referred to in clause (b) of Explanation1 to clause (1), who has been in India for a period or periods amounting in all to one hundred and twenty days or more but less than one hundred and eighty-two days; or

 

(d) a citizen of India who is deemed to be resident in India under clause (1A).

 

Explanation- For the purposes of this section, the expression "income from foreign sources" means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India) and which is not deemed to accrue or arise in India.


 

Procedure for attestation of documents:

 

In case, the Designated partner is residing outside India, then the attached supporting documents should be attested as follows:

A.

Proof of Identity-Passport/PAN Card

Authority of attestation

 

For Indian National (Non-Resident)-who is residing in country which is part of Commonwealth countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in country which is part of Hague countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

Attested by India Embassy

     

B

Proof of Address for Indian Citizen (RI or NRI)

Authority of attestation

 

For Indian National (Non-Resident)-Permanent address in India

Any professional CA/CS or CMA (Practising)

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under CommonWealth countries

Notarised by Public Notary

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Indian National (Non-Resident) - Present address at overseas - -who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer



 

In case, the Designated Partner is a foreign national, then the attached supporting documents should be attested as follows:

A.

Proof of Identity-Passport

Authority of attestation

 

For Foreign National residing in his own country which is under Hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Foreign National residing outside his country and that country where he resides is under Hague Convention

Option A- Notarised by the Public Notary of that foreign country; and

Apostilled by the competent authority of that foreign country

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National residing in his own country which is under commonwealth country

Notarised by the Public Notary

 

For Foreign National residing outside his country and that country where he resides is under commonwealth country

Option A- Notarised by the Public Notary of that foreign country;

Or

Option B - Attested by Embassy of his country of origin at place where he resides

     

B.

Proof of Address (Foreign National)

Authority of attestation

 

For Foreign National residing in his own country which is under Hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Foreign National residing outside his country and that country where he resides is under Hague Convention

Option A- Notarised by the Public Notary of that foreign country; and

Apostilled by the competent authority of that foreign country

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National residing in his own country which is under commonwealth country

Notarised by the Public Notary

 

For Foreign National residing outside his country and that country where he resides is under commonwealth country

Option A- Notarised by the Public Notary of that foreign country;

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National who is from a country which is outside the Commonwealth and also not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer

 

http://thecommonwealth.org/member-countries

http://www.internationalapostille.com/hague-apostille-member-countries/

Documents required for DIN- Indian Designated Partner

(All documents in Pdf scanned. Image file in jpeg format)

(All documents to be Self Attested and signed on each page) 

 

1. Passport size photograph 

2. List of interest in other Company(ies), LLP(s), Partnership(s), Sole Proprietorship(s) giving Name of entity, registration No., Designation, etc.

3. Proof Of Identity (any one) (Name that matches with PAN)

Voter's Identity Card or

Passport or

Driving License

4. Residential Proof (any one)(Name that matches with PAN)

Bank statement or

Electricity Bill or

Telephone Bill or

Mobile Bill

(Should be in name of individual director) (Should not be older than 2 months)

 

Documents required for DIN- NRI Designated Partner

1. Passport size photograph 

2. Verified and attested copy of Passport if the Director has passport

3. List of interest in other Company(ies), LLP(s), Partnership(s), Sole Proprietorship(s) giving Name of entity, registration No., Designation, etc.

4. Residential address proof for permanent address : (any one)(should be in the name of applicant only)

Passport

Election (voter identity) card

Ration card

Driving License

Electricity bill

Telephone bill

Aadhaar

5. Residential address proof for present residential address: (any one)(should be in the name of applicant only)

Passport

Election (voter identity) card

Ration card

Driving License

Electricity bill

Telephone bill 

Aadhaar


 

Documents required for DIN- Foreign Designated Partner

(All documents in Pdf scanned. Image file in jpeg format)

(All documents to be Self Attested and signed on each page) 

1. Passport size photograph 

2. Verified and attested copy of Passport if the Director has passport

3. List of interest in other Company(ies), LLP(s), Partnership(s), Sole Proprietorship(s) giving Name of entity, registration No., Designation, etc.

4. Residential address proof for permanent address : (any one)(should be in the name of applicant only)

Passport

Election (voter identity) card

Ration card

Driving License

Electricity bill

Telephone bill

Aadhaar

5. Residential address proof for present residential address: (any one)(should be in the name of applicant only)

Passport

Election (voter identity) card

Ration card

Driving License

Electricity bill

Telephone bill 

Aadhaar

 

Documents required for Individual Partner (Indian, NRI or Foreign Resident)

Mandatory:

PAN Card 

Aadhaar Card

Passport photo

Declaration from the foreign partner(s) in respect of not having PAN

 

Any one of the following:

Passport

Voter Id

Driving License

 

Any one of the following:

Bank Statement

Electricity Bill

Telephone Bill

Mobile Bill


 

Documents required for Non Individual Partner alongwith the above documents 

 

Mandatory:

Certificate of Incorporation or such proof

MoA and AoA of the Company subscriber

Board Resolution from the Company authorising such investment

If Partner is a foreign Company, then Declaration from the foreign subscriber(s) in respect of not having PAN, and

 

Any one of the following:

Bank Statement

Electricity Bill

Telephone Bill

Mobile Bill


 

For Registered Office premises

 

Mandatory- any one

Rent agreement

Lease Agreement

Ownership deed


 

Mandatory

NOC from Landlord

 

Mandatory- Any one utility bill in name of owner (not older than 2 months)

Electricity Bill

Telephone Bill

Water Bill

Municipal Charges bill