# Who Can Be a Partner in an LLP? (Section 5)

Any individual or body corporate may be a partner in an LLP.

## Disqualifications for Individuals

An individual is NOT capable of becoming a partner of an LLP if:

He has been found to be of unsound mind by a Court of competent jurisdiction and is still of unsound mind;
He is an undischarged insolvent; or
He has applied to be adjudicated as insolvent and his application is pending;
He is a minor.

## Meaning of 'Body Corporate' [Section 2(d)]

Includes:

1. A company defined in Section 2(20) of the Companies Act, 2013

2. A Foreign Company

3. An Indian LLP

4. A Foreign LLP

Does NOT include:

A corporation sole;
A co-operative society registered under any law in force;
Any other body corporate which the Central Government may, by notification in the Official Gazette, specify in this behalf.

## Special Rule for Body Corporate Partners

When a body corporate is a partner, at least two individuals who are partners of such LLP or nominees of such bodies corporate shall act as designated partners.

Worked example

### Example 1

Q. XYZ Cooperative Society Ltd. wants to become a partner in PQR LLP. Is this permissible?

A. No. A co-operative society is expressly excluded from the definition of 'body corporate' under Section 2(d) of the LLP Act. Hence it cannot become a partner of an LLP.

### Example 2

Q. Mr. X, aged 17, wishes to become a partner along with his elder brother in an LLP. Advise.

A. Not permissible. A minor is disqualified from being a partner in an LLP under Section 5. (Note: Unlike Section 30 of the Indian Partnership Act, 1932 which allows a minor to be admitted to the benefits of partnership, the LLP Act has no such provision.)

⚠️ Common exam mistakes

Wrongly assuming a minor can be admitted to the benefits of an LLP (this provision exists in the Partnership Act, 1932, not the LLP Act).
Treating co-operative societies as bodies corporate for LLP purposes — they are excluded.
Forgetting that when a body corporate is a partner, individuals (its nominees) must act as designated partners.

Bare-Act text Section 5 · Limited Liability Partnership Act, 2008 · click to expand

Section 5 — 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 he has been found to be of unsound mind by a Court of competent jurisdiction and is still of unsound mind, or he is an undischarged insolvent, or he has applied to be adjudicated as insolvent and his application is pending, or he is a minor.

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Who Can Be a Partner — Individuals & Bodies Corporate (Section 5)

Worked example

⚠️ Common exam mistakes