Process of Strike Off an LLP
As there are two ways of striking of an LLP, the process of striking off is depends on the way of striking off the LLP. Below, we are mentioning the process of both ways to strike off an LLP.
Voluntary Strike Off Process
The partners initiate this when the LLP is inactive and they wish to close it legally.
Step 1: Hold a meeting – Partners pass a resolution to strike off the LLP.
Step 2: Clear Liabilities – Ensure all debts and dues are paid off.
Step 3: Prepare Documents – Draft affidavits, indemnity bonds, and prepare a statement of accounts.
Step 4: File pending returns – Submit form 8, form 11, and ITR if they are pending to submit.
Step 5: File Form 24 with MCA – File Form 24 with MCA with required document.
Step 6: MCA review and public notice – ROC reviews and publishes notice inviting objections.
Step 7: Striking Off – If no one raises an objection, the MCA strikes off the LLP from its records.
Compulsory Strike Off Process
Step 1: Identify Non-Compliance – LLP has not filed forms or carried on business for two or more years.
Step 2: Notice by ROC – Registrar issues a notice to the LLP and its partners as per the Rule 37 of LLP Rules, 2009.
Step 3: Opportunity to respond – LLP may respond or regularize compliance.
Step 4: No response or justification – If the LLP fails to reply or rectify defaults, ROC will proceed further.
Step 5: Publication of Notice – ROC publishes a notice of intended strike off.
Step 6: Striking Off – After no objections, ROC strikes off the LLP and updates the register.
Required Documents for closing an LLP
- Form 24 : This is the main form to be filed with the MCA for striking off the LLP.
- Application Letter : A formal application requesting the strike off, signed by all designated partners.
- Board Resolution / Consent of Partners : A resolution or consent letter from all partners approving the strike-off.
- Affidavit by Partners : Each partner must submit an affidavit declaring that the LLP has no liabilities and is not carrying on any business.
- Indemnity Bond : A bond stating that any future liabilities after the strike-off will be borne by the partners.
- Statement of Accounts : Certified by a Chartered Accountant, showing the LLP has no assets or liabilities (not older than 30 days from the filing date).
- Income Tax Return Acknowledgment : A copy of the latest ITR filed, if applicable.
- LLP Agreement : A copy of the initial LLP agreement and any amendments made to it.
- Consent of Creditors (if any) : Written consent from creditors, if the LLP has any.
Conclusion
Striking off an LLP in India is a straightforward process if the business is inactive and has met all compliance requirements. Whether you opt for a voluntary closure or the ROC initiates it, following the proper LLP strike off procedure helps avoid future penalties and legal hassles. Ensure all necessary documents are filed correctly with the Ministry of Corporate Affairs (MCA) for a smooth exit. Understanding the process makes it easier for partners to legally close an LLP and maintain good standing with regulatory authorities.
Suggested Read :
Process to Change the LLP Agreement
Partner vs Designated Partner in LLP
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