Close Limited Liability Partnership

Limited Liability Partnership (LLP) is a quite popular business format in India in which all the members have limited liabilities. In general, an LLP is incorporated under legal terms and documents. Alike any other business model, LLP also has its pros and cons. The respective authority has defined clear procedures with respect to the incorporation and winding up of an LLP in India.

At Trademark Bazaar, we provide all necessary help to LLPs looking to shut down their operations in a legal way. According to LLP Act, 2008, there are necessary guidelines that need to be followed while closing an LLP. Our strong team of professionals ensures that our clients don’t encounter major hassles while shutting down the operations of their LLP.

There are basically two ways to close an LLP -

1. Declaring your LLP Non-operational

In this case, an application needs to be made mentioning that the LLP is no more operational and the same should be submitted to the Registrar of Companies (ROC). eForm needs to be filed under Section 37(1)(b) and all the documents mentioned in the form to be submitted and name of your LLP thus are struck off from the LLP’s register.

2. Shutting down your LLP

The section 63, 64 and 65 of LLP Act 2008 controls the process for winding up of the LLP. It is the process where all the assets of the business are written off to meet the liabilities of the LLP and surplus any, is dispersed among the owners. The LLP Act 2008 provides for following two options for winding up the LLP that is -

• Voluntary Winding up- In this case, the partners may between themselves choose to stop and wound up the operations of the LLP.
• Compulsory winding up - A limited liability partnership may be compulsorily wound up by the Tribunal -

1. if the limited liability partnership decides that limited liability partnership be wound up by the Tribunal
2. if, for a period of more than six months, the number of partners of the limited liability partnership is reduced below two;
3. if the limited liability partnership is unable to pay its debts;
4. if the limited liability partnership has acted against the interests of the sovereignty and integrity of India, the security of the State or public order;
5. if the limited liability partnership has made a default in filing with the Registrar the Statement of Account and Solvency or annual return for any five consecutive financial years; or
6. if the Tribunal is of the opinion that it is just and equitable that the limited liability partnership be wound up.