The Corporate Laws & Corporate Governance Committee (CLCGS) of the Institute of Chartered Accountant of India (ICAI) issued a clarification in the form of FAQs for the Limited Liability Partnership (LLP) Settlement Scheme 2020 issued by the Ministry of Criminal Affairs (MCA).
MCA had launched the LLP Settlement Scheme, 2020 as a step towards the Government’s initiative “Ease of Doing Business”. Under the scheme, the ministry has waived the compulsion and has provided a One-time condonation of delay for filing mandatory documents with the registrar. The scheme provides a one-time relaxation to the defaulter in the payment of extra fees for late submission of documents.
The scheme will be active from 16th Mar 2020 to 13th June 2020. The benefits of the scheme can be availed by the defaulters once only as it is not permanent.
It was stated in the FAQs that the scheme will be pertinent on Form 3 (Information about LLP Agreement and Changes), Form 4 (Notice of appointment, cessation, change in name/ address/ designation of all types of partners), Form 8 (Statement of Account & Solvency) and Form 11 (Annual Return of LLP) only, no other forms are included in this scheme.
As per Rule 37(1) of the LLP Rules, 2009, the LPP filing Form 24 with the Registrar for removing the name of LLP from the register of LLPs will not be benefited from this scheme.
The defaulter LLPs can easily file the required documents directly to the registrar and avail the benefit of the scheme without filing any special applications. The defaulters filing the documents before 13th June 2020 will not be levied any kind of penalties or fines from the department.
Under the scheme, the statutory fees provided will be the same as per LLP Rules 2009 but the defaulter will have to pay an extra fee of INR 10 per day accordingly but the total of such fees should not be more than INR 5,000.
The additional fees will be paid differently according to different documents. For example, if there is a delay of 40 days in filing one document and 45 days in other than the defaulter will have to pay INR 400 and INR 450 respectively for both of the documents. Similar rules apply to the limit of INR 5,000 too. If the liability of fines for any defaulter for any document turns out to be more than INR 5,000 than the defaulter is required to pay INR 5,000 only for each document individually.
The Registrar was suggested to take legally required actions, according to the provisions of LLP Rules 2009, against the defaulters timely.
