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Which status disqualifies an individual from becoming a partner under section 5 of the Limited Liability Partnership Act, 2008?

Question and options

Which status disqualifies an individual from becoming a partner under section 5 of the Limited Liability Partnership Act, 2008?

  1. Being a retired government employee

  2. Being a partner in another LLP

  3. Being an undischarged insolvent

  4. Being a non-resident Indian

Answer and explanation

Correct answer: C - Being an undischarged insolvent

Under section 5 of the Limited Liability Partnership Act, 2008, an individual cannot become a partner if found to be of unsound mind by a competent court, if an undischarged insolvent, or if an application to be adjudicated insolvent is pending. Nothing in the section bars a non-resident or a person who is already a partner in another LLP; residence matters only for the requirement that one designated partner be resident in India.

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