Module: General Practice
Q124: The Limited Liability Partnership (LLP) Act, 2008 created a "hybrid" business structure. Which of the following best defines the unique nature of an LLP compared to a traditional partnership?
✅ Correct Answer: C
Correct Option: C. Concept: Limited Liability Partnership (LLP). Context: The LLP Act, 2008 was introduced to provide small businesses the flexibility of a partnership combined with the safety of a company.
Key Distinctions: Separate Entity: Unlike a traditional partnership, an LLP can own assets and be sued in its own name.
Limited Liability: A partner is not personally liable for the wrongful acts or misconduct of other partners.
Their liability is limited to their agreed contribution.
Perpetual Succession: The LLP continues to exist even if partners leave or die.
Key Distinctions: Separate Entity: Unlike a traditional partnership, an LLP can own assets and be sued in its own name.
Limited Liability: A partner is not personally liable for the wrongful acts or misconduct of other partners.
Their liability is limited to their agreed contribution.
Perpetual Succession: The LLP continues to exist even if partners leave or die.