ЁЯУв Too many exams? DonтАЩt know which one suits you best? Book Your Free Expert ЁЯСЙ call Now!

    Question

    Under Section 30 of the Limited Liability Partnership

    Act, 2008, which of the following correctly describes the liability of partners in case of fraud?
    A The liability of all partners is limited to their agreed contribution even in cases of fraud Correct Answer Incorrect Answer
    B Only the designated partners are held liable without limit in cases of fraud Correct Answer Incorrect Answer
    C Partners are liable without limit for all debts or obligations of the LLP if the business was conducted with intent to defraud creditors Correct Answer Incorrect Answer
    D The LLP alone is liable for fraudulent acts; partners are protected under all circumstances Correct Answer Incorrect Answer

    Solution

    Explanation: ┬аOne of the most important exceptions to the principle of limited liability in an LLP is contained in┬а Section 30 of the LLP Act, 2008 . While partners of an LLP generally enjoy limited liability (i.e., their personal assets are protected and liability is limited to their agreed contribution),┬а this protection is lifted in cases of fraud . If it is found that the business of the LLP was carried on with intent to defraud creditors or for any fraudulent purpose, the partners who knowingly participated in such conduct become┬а personally liable without any limit ┬аfor all or any of the debts or obligations of the LLP.

    Practice Next
    More Corporate Law Questions

    Relevant for Exams:

    ask-question