Liquidation / Winding-up of a Limited Liability Partnership (LLP)
Limited Liability
Partnerships in India are governed by the provisions of the Limited Liability
Partnership Act, 2008. Through Dissolution the
existence of LLP is brought to an end. Wind-up can be under
the mechanism of either voluntary winding up or compulsory winding up.
Under
Voluntary winding up mechanism, LLP can be wound-up either “by declaring LLP as
defunct” or “by winding up of LLP as a going concern”. A defunct LLP is the LLP,
which has failed to carry on any business operations since its incorporation or
for the period of one year or more on the date of application. In such case,
LLP can apply to the registrar for dissolution by way of strike off of the name
of LLP from the register of LLP. Registrar also has the power to strike off any
defunct LLP after satisfying himself of the need to strike off and has
reasonable cause, by fulfilling necessary procedure specified by law. Before applying for winding-up by declaring LLP as defunct, following conditions must be fulfilled:
1. Cessation
of all the commercial operations.
2.
Closure
of the bank account in the name of LLP.
3.
All
creditors need to be paid.
4.
LLP
agreement if not filed earlier, must be filed with MCA.
5. LLP annual
compliance forms – Form-8 and Form-11 must be filed up to the
end of FY in which LLP has ceased to carry operations before filing application
in specified Form-24.
6. All
assets to be
Under
compulsory winding up mechanism, LLP can be wound up by order of the Tribunal
for either of the reasons mentioned below:
Ø Ø Where the LLP decides that LLP be wound up by the Tribunal;
Ø Ø Where there are less than two Partners in the LLP for a period of more than 6 months;
Ø
Where
the LLP is not in a position to pay its debts;
Ø
Where
the LLP has acted against the interests of the sovereignty and integrity of
India, the security of State or public order;
Ø
Where
the LLP has not filed with the Registrar Statement of Accounts and Solvency or
LLP Annual Returns for any five consecutive financial years;
Ø Where the Tribunal is of the opinion that it is just and equitable that the LLP should be wound up.
At FastCorp, we can help you liquidate / wind-up LLP by making entire process smooth, stress free and fast by extending our professional expertise and experience. During our assistance, we help you execute all the documents necessary for wind up of LLP and also help you in surrendering all the business registrations, file final returns; secure no-objection etc. wherever applicable.