Consider these points before you draft your LLP Agreement

Published On: Aug 2, 2017Last Updated: Oct 14, 20234.8 min read


In the domain of Limited Liability Partnerships (LLPs), the LLP Agreement plays a pivotal role, in shaping the relationships, rights, and responsibilities of its partners. Every LLP is required to draft an LLP agreement after LLP registration. The Limited Liability Partnership Act of 2008 governs this document, and it transcends mere formality; instead, it forms the very bedrock upon which LLPs construct their operational framework. This article delves into the complexities of the LLP Agreement, such as what you need to draft an LLP agreement, why you need to draft an LLP deed/LLP agreement, examining its indispensability, fundamental components, and the necessary steps to ensure its legal validity.

What is an LLP Agreement?

As per the Limited Liability Partnership Act, 2008:

LLP 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.”

In plain words, LLP Agreement is a document which binds the partners of the LLP inter-alia and with the LLP. Further, it also describes the rights and duties along with same it includes clauses of operation of LLP. Every LLP in India needs to draft an LLP agreement/LLP deed.

Why is there a need for LLP Agreement?

The LLP Agreement is mandatory as the Act requires the same to be furnished after LLP Registration, which shall be updated as and when any changes are required. Further, it is a very important document as it prescribes the rights and duties of Partners and Designated Partners. It is a document which inscribes the actions to be followed in general or specific situations such as the Addition or removal of Partners and Designated Partners. Moreover, it includes the activities carried out by the LLP.

The clauses of the LLP Agreement control and govern the management and operations of the LLP. In case of any dispute or confusion, the agreement serves as the guiding instrument for any LLP, and partners review and consider the clauses before giving their assent through signature in the deed.

How to draft a proper LLP Agreement? 

LLP deed drafting requires you to:

Stamp Duty:

The LLP Agreement shall be printed on stamp paper of the concerned state where the registered office of the LLP is situated. Alternatively, you can pay stamp duty through a banking channel, known as Franking. The State Stamp Act determines the amount of stamp duty payable, which is based on the Capital Introduced in the LLP

Consent of Partners:

The consent of all the partners including designated partners of LLP is necessary for making the Agreement valid. The same is accorded by way of signature of all the partners at the end of the Agreement. In addition to same, the partners shall provide their initials on all the pages of Agreement to avoid any alteration of any clause in fraudulent manner.


To make the agreement valid and enforceable, at least two witnesses must sign it. In addition to their signatures, the witnesses themselves must handwrite their names and addresses. The witness can be any person other than the parties to the agreement being a relative or any friend.

Date and Place of the Agreement

The date on which the LLP Agreement is entered into shall be provided along with the place of the jurisdiction where the agreement is executed.

What are the must-have Clauses in an LLP agreement?

The draft format of LLP agreement India has various clauses, as mentioned in the LLP Act, 2008. These clauses which explain and describe intent of the parties to the agreement. Few of the various necessary clauses in the draft format of LLP agreement in India are mentioned below:

  • Description of the Parties
  • Definitions of the terms used in the Agreement
  • Name and Object Clause
  • Place of Office
  • Capital Contribution and Profit/Loss Sharing Ratio of Partners
  • Remuneration and other consideration clause
  • Accounting policy of the LLP and Management of LLP
  • Mutual Rights and Duties of Partners
  • Restriction against Competitive Business
  • Addition or Appointment of Partner
  • Resignation and Cessation of Partner
  • Winding up of the LLP
  • Arbitration Clause
  • Jurisdiction Clause

In addition to above, there are various clauses, can be added while drafting a LLP Agreement in India. Such as clauses which deal with specific requirement of the LLP and Partners. However, it is to be kept in mind that whaetevr clause you add, they shoudl not violate any provisions of the Act and Rules or Regulations made thereunder. Further, the LLP Act and Rules or Regulations made thereunder shall always prevail over the clauses defined in the LLP Agreement.

Other Pointers

  • The partners must register the LLP Agreement with the MCA within 30 days after receiving the Certificate of Incorporation for the LLP. If they intend to make any changes in the future, they must promptly notify the MCA of these changes within 30 days.
  • The LLP agreement is similar to the MOA and AOA for Companies, it is a fundamental document for an LLP.
  • You can also make changes to LLP agreement if and when required.


Within the intricate landscape of Limited Liability Partnerships, LLP Agreement/LLP deed drafting in India transcends mere documentation. It serves as the very backbone of the entity. It delineates the rules of engagement, pathways to dispute resolution, and also the guidelines for growth. Analogous to a constitution, it furnishes a structural framework for LLPs to operate efficiently and harmoniously. Whether in the meticulous crafting of a flawless agreement, comprehension of legal nuances, or meticulous adherence to statutory requirements, the LLP Agreement commands the central spotlight. It is not a mere legal obligation; rather, it stands as an indispensable instrument in the journey of an LLP.

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CS Prachi Prajapati
About the Author

CS Prachi Prajapati

Company Secretary with a forte in content writing! Started as a trainee, she is now leading as a Content Writer and a Product Developer on technical hand of The author finds her prospect to carve out a valuable position in Legal and Secretarial field.

One Comment

  1. Vibha 20/08/2020 at 7:05 am - Reply

    Whether Full name of Witness includes Father’s name?

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