Under which specific circumstance does the liability of a partner in an LLP become unlimited under Section 30 of the LLP Act 2008?
Answer and explanation
Correct answer: C. When any act is carried out with intent to defraud creditors or for any fraudulent purpose
- Step 1: Consult Section 30 of the LLP Act 2008 regarding fraud and unlimited liability.
- Step 2: If any activity is carried out by the LLP or any partner with intent to defraud creditors or for any fraudulent purpose, the corporate veil is pierced.
- Step 3: The liability of the LLP and of the partners who acted with fraudulent intent becomes unlimited for all debts of the LLP.
Answer
When any act is carried out with intent to defraud creditors or for any fraudulent purpose.
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