The Ministry of Corporate Affairs, Government of India has introduced the LLP Settlement Scheme 2020. The scheme is set to give defaulting LLPs a one-time relaxation in paying the condonation fees for the delayed filing of documents. The scheme will come into force from 16th of March 2020 and will be in force up till the 13th of June 2020. This article deals with the details of the LLP Settlement Scheme 2020.
Reasons for the Scheme
The initiation of the LLP settlement scheme is for certain reasons and following are the reasons:
- Many of the LLP have been at default for filing the documents. Such LLP was charged with a fine amount of Rs.100 per day along with the additional fee for delayed filing of the document
- The pleas from a large number of LLP representations regarding the condonation of delay, waiver of fees and also the additional LLP
- The LLP and their designated partners become liable for criminal prosecution if the LLP fails to file the document. For such defaults, the LLP cannot close until the completion of all its compliances
A defaulting LLP which is registered under the Limited Liability Partnership Act, 2008 is applicable for the scheme. But such an LLP is applicable only if it has made any default in filing the documents. The filing of the documents due upto 31st of October, 2019 is eligible.
Manner of Payment of Fees
The LLP which is at default for not filing their documents is subject to pay a certain amount as fine. While filing the documents, the LLP has to pay Rs.10 for each delayed date upto Rs.5,000 per document.
Immunity from Prosecution
There is a prosecution by the Registrar if any of default LLP has not filed the documents. LLPs which files documents within 13th of June 2020 under the scheme will escape prosecution.
Filing of Documents
The scheme is applicable only for filing the following delayed documents from the LLP Act:
- Form-3 which relates to the Information regarding the LLP agreement and its changes.
- Form-4 which relates to the notice of cessation, appointment, changes in name, address, consent to become a partner or designated partner and designation of a partner or designated partner.
- Form-8 which relates to the Statement of Account and Solvency either annual or interim.
- Form-11 which relates to the filing of annual return of the LLP.
If an LLP has made an application for strike-off to the Registrar, then it is not applicable under this scheme.
The notification for the LLP settlement scheme 2020 is below for reference: