Scheme Start Date : 16.03.2020
Scheme End Date: 13.06.2020
Vide MCA General Circular No. 6/2020 regarding LLP settlement Scheme, 2020, datted 04-03-2020.
As a part of Government's initiative of ease of doing business, Ministry of Corporate Affairs has come up with LLP Settlement Scheme which allows One-time condonation of delay in filing statutorily required documents with the Registrar.
Limited liability Partnership is a form of corporate structure that combines the flexibility of partnership of partnership firms and limited liability of a company. Due to applicability of huge additional fee on late filing, a large number of Limited Liability Partnerships (LLPs) have remained non-compliant, as high payment of late fees for the cumulative period of delay makes LLPs unable to pay.
This scheme is applicable to a “defaulting LLP” to file belated documents, which were due for filing till 31st October, 2019 on payment of additional fee of Rs 10/- per day for delay, in addition to any fee as is payable for filing of such document or return, provided that such payment of additional fee shall not exceed Rs. 5,000/- per document.
Applicability of Scheme - This scheme is applicable to following forms only -
(i) Form-3- Information with regard to limited liability partnership agreement and changes, if any, made therein;
(ii) Form-4- Notice of appointment, cessation, change in name/ address/designation of a designated partner or partner and consent to become a partner/designated partner;
(iii) Form-8- Statement of Account & Solvency (Annual or Interim); and
(iv) Form 11 - Annual Return of Limited Liability partnership (LLP)
Benefits of LLP Settlement Scheme –
- Meet non-compliance in LLPs with penalty of Rs. 10 per day or maximum Rs. 5000 instead of Rs. 100 per day.
- Make LLPs operational without any non-compliance by filing all pending forms.
- 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 the Registrar for such defaults.
- There are LLPs which have not filed annual forms 8 and 11 for 10 years and for them penalty would be normally 4 lakhs or more. Now, they can clear the default by simply paying Rs. 5000 only.
- Make life easier for businesses which might be facing problem due to non-filing of returns.
- There are LLPs which are not in operation but could not strike off just because of non-filing of annual forms 8 and 11 and unless annual filing is completed strike off can not be done. These all such LLPs can easily opt for strike off just by completing all non-filing at minimal penalty.
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MCA Circular LLP settlement Scheme 2020