LLP SETTLEMENT SCHEME 2020

           LLP SETTLEMENT SCHEME 2020     

 The Ministry of Corporate Affairs on 4^th March 2020 has announced a one-time settlement scheme for limited liability partnerships (LLPs) that hasn’t submitted their statutory documents to gain immunity from prosecution for defaults by filing pending documents. It has come across to the Government that large numbers of LLPs have made default in filing various forms like Form-3, Form-4, Form-8, and Form-11. In a bid to promote “ease of doing business”, the Ministry of Corporate Affairs has decided to give a one-time relaxation in an additional fee to the defaulting LLPs to make good their default by filing pending documents and to serve as a compliant LLP in future. http://www.mca.gov.in/Ministry/pdf/GeneralCircular06_04032020.pdf

• APPLICABILITY OF THE SCHEME:

This Scheme shall come into force on the 16th March, 2020 and shall remain in force upto 13th June, 2020 and during this tenure defaulting LLPs are permitted to file there belated statutory documents which were pending upto 30^th October, 2019.

• SCHEME APPLIES TO FILING OF FOLLOWING FORMS:

The scheme applies on the following mentioned Forms:

NOT APPLICABLE ON: All other forms filing other than Form 11, 8, 3, & 4.The LLPs which has made an application in Form-24 to the Registrar, for striking off its name from the register.

• ADDITIONAL FEE ON FILING:

 The Additional fee of Rs.100 per day is reduced to mere Rs. 10 per day.

While there is no upper limit of additional fees that keep on rising by Rs. 100 per day is capped at Rs. 5,000/- under the scheme.

CONSEQUENCES OF NOT FILING:

The additional fees would be back to Rs. 100 and it will have no upper cap post expiry of the scheme. The defaulting LLPs, which have filed their pending documents till 13th June, 2020 and made good the default, shall not be subjected to prosecution by Registrar for such defaults. On the conclusion of the Scheme, the Registrar shall take necessary action under the LLP Act, 2008 against the LLPs which have not availed this Scheme and which still a defaulting LLP.