Banking · Credit Appraisal
A Limited Liability Partnership (LLP) borrower, under the Indian context, is characterized by which of the following statements concerning its liability, perpetual succession, and audit requirements?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Partners' liability is unlimited, it has perpetual succession, and an audit is mandatory only if contribution exceeds 25 lakh or annual turnover exceeds 40 lakh.
- 2Partners' liability is limited to their agreed contribution, it has no perpetual succession, and an audit is always mandatory.
- 3Partners' liability is limited to their agreed contribution, it has perpetual succession, and an audit is mandatory only if contribution exceeds 25 lakh or annual turnover exceeds 40 lakh.✓
- 4Partners' liability is unlimited, it has no perpetual succession, and an audit is always mandatory.
Correct answer
Partners' liability is limited to their agreed contribution, it has perpetual succession, and an audit is mandatory only if contribution exceeds 25 lakh or annual turnover exceeds 40 lakh.
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