LLP settlement scheme 2020 would allow for a one-time condonation of the delay in filing with the Registrar statutory records. LLP Settlement Scheme, 2020 will come into effect on March 16, 2020, and remain in force until June 13, 2020.
It was found that due to the applicability of additional late filing fee, which could in effect become a financial burden in case of inordinate delay, a large number of Limited Liability Partnerships (LLPs) have remained non-compliant, primarily because of their inability to pay late fees for the accumulated delay period.
As part of the ongoing efforts by the government to encourage ease of doing business, it was agreed to grant the default LLPs a one-time relaxation in addition to an additional fee by filing pending documents and serve as a compliant LLP in the future.
Accordingly, the Central Government has decided to implement a scheme called “LLP Settlement Scheme, 2020” by providing for a one-time condonation of delay in the filing with the Registrar of statutory documents.
LLPs, who wish to take advantage of the scheme, may file pending documents/forms and rectify defaults in order to gain immunity from prosecution for such defaults.
The scheme shall come into force on March 16, 2020, and will remain in effect until June 13, 2020. It would apply to the default LLP in respect of the filing of late documents due for filing until 31 October 2019 for payment of a nominal additional fee of Rs 10/-per day for the period of delay, in addition to any fee payable for the filing of such document or return, subject to a maximum amount of Rs. 5,000/-as an additional fee per document.
The Scheme shall apply to the filing of the following documents:
- Form-3-Information on the limited liability partnership agreement and changes, if any, made therein;
- Form-4- Notice of appointment, termination, change of name/address/appointment of a designated partner or partner and consent to become a partner / appointed partner;
- Form-8-Statement of Account & Solvency (Annual or Interim)
- Form-11- Annual Return of Limited Liability Partnership (LLP).
This scheme shall not apply to LLPs which have made an application to the Registrar in Form 24 for the deletion of their name from the Register as per provision to Rule 37(1) of the LLP Rules of 2009.
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