The Limited Liability Partnership Act, 2008 –Law MCQ Questions with Answers

1. The LLP Act, 2008 came into force from:

(a) 30th September, 2008
(b) 31st March, 2009
(c) 1st July, 2009
(d) 1st April, 2008
Answer:
(b) 31st March, 2009

2. Maximum number of partners in a LLP can be:

(a) 10
(b) 20
(c) 50
(d) Unlimited
Answer:
(d) Unlimited (https://cleartax.in/s/limited-liability-partnership-registration-procedure-india)

3. Minimum number of partners in a LLP can be:

(a) 1
(b) 2
(c) 5
(d) 4
Answer:
(b) 2. (S. 6)

In a LLP, the partners are agents of LLP as under_________.

(a) Section 24
(b) Section 25
(c) Section 22
(d) Section 26
Answer:
(d) 26

6. Which of the following is not mandatory for an LLP?

(a) Registered office
(b) have either the words "limited liability partnership" or the acronym "LLP" as the last words
of its name.
(c) Both A & C
(d) Common seal
Answer:
(d) Common seal (S. 14 (c))

7. Every partner shall inform the limited liability partnership of any change in his name or
address within a period of ________days of such change..
(a) 15
(b) 21
(c) 7
(d) 30
Answer:
(a) 15. (S. 25)

8. Can an HUF can become partner in LLP:

(a) No, an HUF cannot become partner in the LLP.

(b) Both (c) and (d)

(c) Yes, HUF may become partner of LLP.

(d) Yes, it may become partner of LLP provided the Registrar may grant permission in this
behalf.

Answer:
(a) No. (S.5)

9. Every LLP shall have at least _______ designated partners:

(a) 1

(b) 3

(c) 2
(d) 7

Answer:
(c) 2. (S.7)

10. Out of the designated partners at least ______ of them shall be a resident in India:

(a) 1

(b) 3

(c) 2

(d) 7

Answer:
(a) 1. (S.7)

10. Which of the following is correct about the designated partners:

(a) Any Legal Person

(b) They can be Body Corporates

(c) They can only be individuals

(d) Both A and B.

Answer:

(c) Can only be individuals. (S. 7)

Check Answer
Q.5:- The LLP shall file the Statement of Account and Solvency in the prescribed form.
Which is this Form:

a. Form 8
b. Form 7
c. Form 6
d. Form 5

Check Answer
Q.6:- Who is the authority to grant compounding of offence under the LLP Act:

a. The Registrar of Firms

b. The Central Government
c. The Registrar
d. The Registrar of Co-operatives

Check Answer
Q.7:- What is the time limit within which LLP shall file Annual Return with the Registrar:

a. Within 30 days of closure of its financial year.

b. Within 45 days of closure of its financial year.
c. Within 60 days of closure of its financial year.
d. Within 15 days of closure of its financial year.

Check Answer
Q.8:- Every LLP shall keep books of account, which shall contain:

a. Statement of cost of goods purchased inventories, work-in-progress, finished goods and

cost of goods sold.
b. A record of the assets and liabilities of the LLP.
c. Particulars of all sums of money received and expended by the LLP and the matters in
respect of which the receipt and expenditure takes place.
d. All of the above.

Check Answer
Q.9:- At which place the LLP shall maintain books of accounts:

a. At its Branch Office

b. At its Corporate Office
 c. At its Head Office
d. At its Registered Office

Check Answer
Q.10:- The LLP shall maintain proper books of account relating to its affairs for each year
of its existence on which basis:

a. Accrual basis
b. Double entry system of accounting
c. Cash basis
d. All of the above.

Check Answer
Q.11:- Who shall sign the Statement of Account and Solvency prepared by the LLP:

a. By any one partner, authorised in this behalf

b. By at least two partners, authorised in this behalf
c. By all the partners
d. By the designated partners

Check Answer
Q.12:- The Statement of Account and Solvency is required to be filed by the LLP with:

a. The Registrar of Co-op Societies

b. Need not to file.
c. The Registrar
d. The Registrar of Firms

Check Answer
Q.13:- Whether incorporation documents, names of partners and changes, if any,
Statement of Account and Solvency and Annual Return field with the Registrar can be
inspected:

a. Yes, it can be inspected by any of the partners of the LLP

b. Yes, It can be inspected only Government Authorities and Banks
c. Yes, it can be inspected only the creditors of the LLP
d. Yes, it can be inspected by any person on payment of the prescribed fee.

Check Answer
Q.14:- The books of account which a LLP is required to keep shall be preserved for how
many years:
 a. Eight Years
b. Six Years
c. Four years
d. Two years

Check Answer
Q.15:- What is the fee to paid to the Registrar for filing of the Statement of Account and
Solvency, where the contribution does not exceed Rs 1 lakh:

a. Rs. 200
b. Rs. 50
c. Rs. 100
d. Rs. 150

Check Answer
Q.16:- What is the fee to paid to the Registrar for filing of the Statement of Account and
Solvency, where the contribution exceeds Rs 5 lakh but does not exceed Rs l0 lakh:

a. Rs. 200.
b. Rs. 100.
c. Rs 50.
d. Rs. 150.

Check Answer
Q.17:- What is the fee to paid to the Registrar for filing of the Statement of Account and
Solvency, where the contribution exceeds Rs 10 lakh:

a. Rs. 200.
b. Rs. 150.
c. Rs. 100.
d. Rs 50.

Check Answer
Q.18:- Who shall fix the remuneration of the auditor:

a. The designated partners shall fix the remuneration

b. As per the procedure laid down in the LLP Agreement.
c. The Registrar may fix the remuneration
d. Both A and B are correct.

Check Answer
Q.19:- LLP shall file its Annual Return in which form:
 a. Form 12
b. Form 11
c. Form 10
d. Form 9

Check Answer
Q.20:- What is the fee for inspection of documents:

a. Rs 200.
b. Rs 150.
c. Rs 100.
d. Rs 50.

Check Answer
Q.21:- What is the fee for obtaining certified copy:

a. Rs. 3 per page or fractional part thereof

b. Rs. 5 per page or fractional part thereof
c. Rs. 2 per page or fractional part thereof
d. Rs. 1 per page or fractional part thereof

Check Answer
Q.22:- What is the fee for filing, registering or recording notice of appointment, cessation,
change in name, address, designation of a partner or designated partner, intimation of
Designated Partner Identification Number and consent to become a partner or designated
partner in Form 4:

a. Rs 50
b. Rs 100
c. Rs. 150
d. Rs. 200

Check Answer
Q.23:- Where an auditor is unwilling to be re• appointed, he shall give a notice in writing to
that effect at the LLP’s registered office before the end of the time allowed for appointing
the new auditor, along with the statement of circumstances connected with his ceasing to
hold office:

a. not less than 28 days

b. not less than 21 days
c. not less than 14 days
 d. not less than 07 days

Check Answer
Q.24:- Who can remove the auditors from his office:

a. The partners of the LLP may remove an auditor form office at any time by following the
procedure as laid down in the LLP Agreement.
b. Where the LLP Agreement does not provide for the removal of an auditor, consent of all the
partners shall be required for removal of the auditor form his office
c. The Registrar.
d. Both A and B are correct

Check Answer
Q.25:- The designated partners may appoint auditor(s), but if the designated partners fails
to appoint the auditor(s), then who will make the appointment of the auditor(s):

a. The Registrar of Co-operative Societies

b. The other partners of the LLP
c. The Registrar of Firms
d. The Registrar

Check Answer
Q.26:- What is the fee to paid to the Registrar for filing of the Statement of Account and
Solvency, where the contribution exceeds Rs 1 lakh but does not exceed Rs 5 lakh:

a. Rs. 200.
b. Rs. 150.
c. Rs. 100.
d. Rs 50.

Check Answer
Q.27:- An auditor or auditors of an LLP shall hold office in accordance with the terms of
his or their appointment and shall continue to hold such office till the period:

a. They are re-appointed

b. Only for one financial year
c. The new auditors are appointed
d. Options A and C are correct.

Check Answer
Q.28:- The audit of accounts of every LLP is not''' compulsory if its:
 a. Turnover does not exceed in any financial year, Rs 40 lakh or whose contribution does not
exceed Rs 25 lakh
b. Turnover does not exceed, in any financial year, Rs 30 lakh, or whose contribution does not
exceed Rs 25 lakh
c. Turnover does not exceed, in any financial year, Rs 20 lakh, or whose contribution does not
exceed Rs 25 lakh
d. Turnover does not exceed, in any financial year, Rs 10 lakh, or whose contribution does not
exceed Rs 25 lakh

Check Answer
Q.29:- What are the penal provisions for the LLP, if any LLP fails to comply with the
provisions of Section 35 which deals with the filing of the Annual Return with the
Registrar:

a. The LLP shall be punishable with fine which shall not be less than Rs 10000 but which may
extend to Rs 5 lakh.
b. The LLP shall be punishable with fine which shall not be less than Rs 15000 but which may
extend to Rs 5 lakh.
c. The LLP shall be punishable with fine which shall not be less than Rs 20000 but which may
extend to Rs 5 lakh.
d. The LLP shall be punishable with fine which shall not be less than Rs 25000 but which may
extend to Rs 5 lakh.

Check Answer
Q.30:- What is the periodicity of preparing the Statement of Account and Solvency by the
LLP:

a. Within a period of three months from the end of each financial year.
b. Within a period of nine months from the end of each financial year.
c. Within a period of twelve months from the end of each financial year.
d. Within a period of six months from the end of each financial year.

Check Answer
Q.31:- What are the penal provisions for LLP, if any LLP fails to comply with the
provisions of Section 34 (which relates to the maintenance of books of account, other
records and audit, etc):

a. The LLP shall be punishable with fine which shall not be less than Rs 15000 but which may
extend to Rs 5 lacs.
b. The LLP shall be punishable with fine which shall not be less than Rs 25000 but which may
extend to Rs 5 lacs.
 c. The LLP shall be punishable with fine which shall not be less than Rs 20000 but which may
extend to Rs 5 lacs.
d. The LLP shall be punishable with fine which shall not be less than Rs 10000 but which may
extend to Rs 5 lacs.

Check Answer
Q.32:- What are the penal provisions for designated partners, if any LLP fails to comply
with the provisions of Section 34 (which relates to the maintenance of books of account,
other records and audit, etc):

a. Every designated partner of such LLP shall be punishable with fine which shall not be less
than Rs 15000 but which may extend to Rs 1 lakh.
b. Every designated partner of such LLP shall be punishable with fine which shall not be less
than Rs 10000 but which may extend to Rs 1 lakh.
c. Every designated partner of such LLP shall be punishable with fine which shall not be less
than Rs 5000 but which may extend to Rs 1 lakh.
d. Every designated partner of such LLP shall be punishable with fine which shall not be less
than Rs 1000 but which may extend to Rs 1 lakh.

Check Answer
Q.33:- What are the penal provisions for the designated partners of LLP, if any LLP fails
to comply with the provisions of Section 35 which deals with the filing of the Annual
Return with the Registrar:

a. The designated partners of the LLP shall be punishable with fine which shall not be less
than Rs 1000 but which may extend to Rs 1 lakh.
b. The designated partners of the LLP shall be punishable with fine which shall not be less
than Rs 5000 but which may extend to Rs 1 lakh.
c. The designated partners of the LLP shall be punishable with fine which shall not be less
than Rs 10000 but which may extend to Rs 1 lakh.
d. The designated partners of the LLP shall be punishable with fine which shall not be less
than Rs 15000 but which may extend to Rs 1 lakh.

Check Answer
Q.34:- What is the penalty for the false statement made by the LLP in any return,
statement of other documents required by or for the purposes of any of the provisions of
the LLP Act Y.

a. The person concerned shall be punishable with imprisonment for a term which may extend
to 1 years and shall also be liable to fin which extend to Rs 5 lakh but which shall not be
less than Rs 1 lakh.
 b. The person concerned shall be punishable with imprisonment for a term which may extend
to 2 years and shall also be liable to fin which extend to Rs 5 lakh but which shall not be
less than Rs 1 lakh.
c. The person concerned shall be punishable with imprisonment for a term which may extend
to 3 years and shall also be liable to fin which extend to Rs 5 lakh but which shall not be
less than Rs 1 lakh.
d. The person concerned shall be punishable with imprisonment for a term which may extend
to 4 years and shall also be liable to fin which extend to Rs 5 lakh but which shall not be
less than Rs 1 lakh.

Check Answer
Q.35:- What is the penal provision, if any person who, without lawful excuse, {fails to
comply with any summons or requisition of the Registrar under section 38, which deals
with the Powers of Registrar to obtain information:

a. The person concerned shall be punishable with fines which shall not be less Rs 2000 but
which extend to Rs 25000.
b. The person concerned shall be punishable with fines which shall not be less Rs 1500 but
which extend to Rs 25000.
c. The person concerned shall be punishable with fines which shall not be less Rs 1000 but
which extend to Rs 25000.
d. The person concerned shall be punishable with fines which shall not be less Rs 500 but
which extend to Rs 25000.

Check Answer
Q.36:- An individual or body corporate cannot be a partner in a limited liability
partnership.

a. Only Body corporate can form LLP

b. Only Individual can form LLP
c. The statement is wrong.
d. The statement is correct.

Check Answer
Q.37:- What is LLP IN:

a. It is actually CIN.
b. Every LLP registered with the Registrar shall be assigned a LLP identification number in
one consecutive series and is called as LLPIN.
c. It is just like DPIN.
d. It is just like DIN
Check Answer
Q.38:- Every limited liability partnership shall have atleast two designated partners who
are individuals and at least one of them shall be:

a. An Indian resident
b. A person of foreign national
c. A resident inIndia
d. A person having Indian Passport

Check Answer
Q.39:- In terms of section 23 (2) of the LLP Act, 2008, every LLP shall file information with
regard to the LLP agreement in the prescribed form, with the Registrar within thirty days
of the date of information. What is the prescribed Form No.:

a. Form No.2
b. Form No.3
c. Form No. 4
d. Form No. 1

Check Answer
Q.40:- The Court or Tribunal may reduce or waive penalty leviable against any partner or
employee of LLP if it is satisfied that:

a. When any information given by any partner or employee(whether or not during

investigation) leads to LLP or any partner or employee of such LLP being convicted under
this Act or any other Act.
b. Such partner or employee of a LLP has provided useful information during investigation of
such LLP.
c. Both the options A and B are correct
d. None of the above.

Check Answer
Q.41:- Every partner of a limited liability partnership is, for the purpose of the business of
the limited liability partnership:

a. The agent of the limited liability partnership, but not of other partners.
b. The agent of the limited liability partnership and agent of other partners.
c. The agent as well as principal of the limited liability partnership.
d. None of the above.

Check Answer
Q.42:- 30. The annual return of an LLP having turnover up to five crore) rupees during
the corresponding financial year or contribution, up to (fifty lakh rupees shall be
accompanied with a certificate from a designated partner, other than the signatory to the
annual return, to the effect that annual return contains true and correct information. In all
other cases, the annual return shall be accompanied with a certificate from a to the effect
that he has verified the particulars from the books and records of the limited liability
partnership and found them to be true and correct:

a. Company Secretary in Practice

b. Cost Accountant in Practice
c. Advocate
d. Chartered Accountant in Practice

Check Answer
Q.43:- In terms of section 25(2), where a person becomes or cases to be a partner or where
there is any change in the name or address of a partner, the LLP shall file with the
Registrar a notice in:

a. Form No.5
b. Form No. 6
c. Form No.3
d. Form No.4

Check Answer
Q.44:- If the LLP contravenes the provisions of section 24 (2), which relates to the
information to the Registrar about any changes of cessation of partner and change in the
name and address of the partner, the LLP and every designated partner of the LLP shall
be punishable with fine:

a. The fine shall not be less than two thousand rupees but which may extend to twenty-five
thousand rupees.
b. The fine shall not be less than four thousand rupees but which may extend to twenty- five
thousand rupees.
c. The fine shall not be less than one thousand rupees but which may extend to twenty-five
thousand rupees.
d. The fine shall not be less than three thousand rupees but which may extend to twenty-five
thousand rupees.

Check Answer
Q.45:- A person shall not be capable of being appointed as a designated partner of a LLP,
if he:
 a. Suspends, or has at any time within the preceding five years suspended payment to his
creditor and has not at any time within the preceding five years made, a composition with
them
b. Has been convicted by a Court for any offence involving moral turpitude and sentenced in
respect thereof toe imprisonment for not less than six month or has been convicted by a
Court for an offence involving section 30 of the Act.
c. Has at any time within the preceding five years been adjudged insolvent.
d. All of the above.

Check Answer
Q.46:- A limited liability partnership:

a. Shall not have perpetual succession.

b. Shall have its operations only for 5 years.
c. Shall have perpetual succession.
d. Shall have its operations for a limited period

Check Answer
Q.47:- How many partners are required to form LLP:

a. It shall have at least more than two partners.

b. It shall have at least more than seven partners.
c. It shall have at least two partners.
d. It shall have least seven partners

Check Answer
Q.48:- In terms of section 7 (3), an individual shall give his prior consent to act as a
designated partner of the limited liability partnership in the prescribed form, which is:

a. Form 9
b. Form 8
c. Form 11
d. Form 10

Check Answer
Q.49:- What is the filing fee for LLP in case where the contribution of LLP exceed Rs Ten
lakh:

a. Rs.150.
b. Rs. 200
c. Rs. 50.
 d. Rs.100.

Check Answer
Q.50:- When a person shall cease to be a partner of a limited liability partnership:

a. If he is declared to be of unsound mind by a competent court;

b. If he has applied to be adjudged as an , insolvent or declared as an insolvent
c. On his death or dissolution of the limited liability partnership
d. All of the above.

Check Answer
1. Which of the following is true about a Limited Liability Partnership?
a. A Limited Liability Partnership is not a distinct entity from its partners
b. A Limited Liability Partnership is a legal entity separate from its partners
c. A Limited Liability Partnership is a body corporate
d. Both b and c are correct
Answer: d

2. Which of the following is true about the number of designated partners required in
a Limited Liability Partnership?
a. A Limited Liability Partnership can have at least two designated partners
b. A Limited Liability Partnership can have at least three designated partners
c. A Limited Liability Partnership can have at least seven designated partners
d. A Limited Liability Partnership can have at least four designated partners
Answer: a

3. What is the exact time limit under which a Limited Liability Partnership must file
its annual return with the registrar?
a. A Limited Liability Partnership must file its annual return within 30 days from the
closing of its financial year
b. A Limited Liability Partnership must file its annual return within 45 days from the
closing of its financial year
c. A Limited Liability Partnership must file its annual return within 15 days from the
closing of its financial year
d. A Limited Liability Partnership must file its annual return within 60 days from the
close of its financial year
Answer: a

4. Every Limited Liability Partnership must maintain its books of accounts diligently.
Those books of accounts should maintain _________.
a. Particulars of the receipts and expenditures at the Limited Liability Partnership
with the details of those transactions
b. An inventory of the cost of goods purchased, work in progress, inventories,
finished goods as well as the cost of goods sold
c. A complete record of the assets and liabilities of the Limited Liability Partnership
d. All of the above
 Answer: d

5. Which of the following is the designated place where a Limited Liability

Partnership should maintain its accounts?
a. A Limited Liability Partnership should maintain its accounts at the branch office
b. A Limited Liability Partnership should maintain its accounts at the corporate
office
c. A Limited Liability Partnership should maintain its accounts at the head office
d. A Limited Liability Partnership should maintain its accounts at the registered
office
Answer: d

6. On what basis should a Limited Liability Partnership maintain its books of accounts
for every year of their existence?
a. A Limited Liability Partnership should maintain its books of accounts on the
accrual basis
b. A Limited Liability Partnership should maintain its books of accounts on the cash
basis
c. A Limited Liability Partnership should maintain its books of accounts based on
the double-entry system of accounting
d. All of the above
Answer: d

7. Which among the following parties in a Limited Liability Partnership should sign
the Statement of Account and Solvency?
a. It should be signed by the designated partners authorised on behalf of the Limited
Liability Partnership
b. It should be signed by one partner authorised on behalf of the Limited Liability
Partnership
c. It should be signed by all partners of the Limited Liability Partnership
d. It should be signed by at least two partners authorised on behalf of the Limited
Liability Partnership
Answer: a

8. The Limited Liability Partnership should file its statement of account and solvency
with which of the following parties?
 a. The Limited Liability Partnership should file its statement of account and
solvency with the registrar of firms
b. The Limited Liability Partnership should file its statement of account and
solvency with the registrar
c. The Limited Liability Partnership should file its statement of account and
solvency with the registrar of cooperative societies
d. None of the above
Answer: b

9. Which of the following statements is true about the books of accounts for a Limited
Liability Partnership?
a. The books of accounts for a Limited Liability Partnership must be preserved for
four years
b. The books of accounts for a Limited Liability Partnership must be preserved for
two years
c. The books of accounts for a Limited Liability Partnership must be preserved for
eight years
d. The books of accounts for a Limited Liability Partnership must be preserved for
six years
Answer: c

10. Which of the following parties in a Limited Liability Partnership is responsible for
fixing the auditor’s remuneration?
a. The registrar may fix the auditor’s remuneration
b. The designated partners in a Limited Liability Partnership may fix the auditor’s
remuneration
c. The auditor’s remuneration gets decided as per the procedure laid down in a
Limited Liability Partnership agreement
d. Both b and c are correct
Answer: d

11. Which of the following parties in a Limited Liability Partnership can remove the
auditor from their office?

1. The registrar can remove the auditor

2. The partners can remove the auditor following the guidelines present in the
Limited Liability Partnership agreement
 3. If the Limited Liability Partnership agreement has no provision for removing the
auditor, the consent of all partners is necessary to relieve the auditor from their
duties
4. Both b and c are correct
Answer: d

12. Which of the following parties can appoint an auditor if the designated partners in a
Limited Liability Partnership fail to select one?

a. The other partners in the Limited Liability Partnership can appoint an auditor
b. The registrar of the cooperative societies can appoint an auditor
c. The registrar of firms can appoint an auditor
d. The registrar can appoint an auditor
Answer: a

13. Which of the following statements is true about the auditor in the Limited Liability
Partnership?
a. An auditor in a Limited Liability Partnership shall continue to hold office as per
the terms of their appointment till they are re-appointed
b. An auditor in a Limited Liability Partnership shall continue to hold office as per
the terms of their appointment for one financial year
c. An auditor in a Limited Liability Partnership shall continue to hold office as per
the terms of their appointment till the new auditors are appointed
d. Both a and c are correct
Answer: d

14. The statement of account and solvency in a Limited Liability Partnership should be
prepared __________.
a. Within four months from the end of the financial year
b. Within six months from the end of the financial year
c. Within three months from the end of the financial year
d. Within two months from the end of the financial year
Answer: b

15. The Limited Liability Partnership Act, 2008 came into force on ______.
a. 21st March 2009
b. 23rd March 2009
 c. 31st March 2009
d. 30th March 2009
Answer: c