Brief Analysis of LLP Settlement Scheme, 2020

Reasons for which this scheme introduced by the Ministry of Corporate Affairs-

-Filling of delay documents/returns attracts 100 per day of default for each return and documents which put the financial burden on the LLP that’s why this scheme is introduced for waiver of additional fees.

-Regulators don’t have records for inspection because of failure in filing statutory returns.

-LLPs are unable to strike off its name from the register due to non-compliance.

-LLPs and their Designated Partners were liable for Criminal Prosecution.

Central Government u/s 460 of the Companies act, 2013 vide Gazette Notification No. G.S.R. 59(E) dated 30th January 2020 u/s 67(2) of LLP Act, 2008 introduced a scheme namely “LLP SETTLEMENT SCHEME, 2020” by allowing a one-time condonation of delay in filing statutorily required docs with the Registrar. MCA vide its circular no. 6/2020 dated 4th March 2020 clarified about the Scheme. Due to the outbreak of COVID-19, few modifications took place to vide its circular no. 13/2020 dated 30th March 2020. Here is all about Scheme after considering modification-

1. Duration: – From 1^st April 2020 till 30^th September 2020

2. Applicability: – All Belated documents to be filled by the defaulting LLP which were due for filing till 31^st October 2019.

3. Non-Applicability: – As per provisions of Rule 37(1) of LLP Rules, 2009, those LLP which made an application in Form 24 to the registrar for striking off its name from the register.

3. Fees and Additional Fees: – All Filling shall charge a normal fee and all additional fees are waived off.

4. Punishment: – Prosecution by registrar against defaulting LLPs after 30^th September 2020 if the LLPs don’t make their default good.

Disclaimer: – This write up is intended to insight on significant circular under Companies Act, 2013. It is not intended to be a bit of professional advice; therefore, Our Firm accepts no responsibility whatsoever and will not be liable for any losses, claims or damages which may arise because of the contents of this write-up. We can be contacted if anyone has query then pls mail at sjvandassociates@outlook.com.