or Limited Liability Partnership Act 2008 governs the procedure for winding up
of the LLP. It is a new form of business entity and it enjoys audit exemption
if the annual turnover is less than Rs. 40 lakhs and the capital contribution
is less than 25 lakhs. There are two ways of winding up of LLP first is
voluntary winding up and second is winding up by tribunal.
Reasons for winding up
- The LLP wants to be wound up.
- If the partners are less than two in the LLP for a period of more than 6 months.
- When LLP is not in position to pay its debt.
- The LLP has not filed with the Registrar Statement of Accounts and Solvency or LLP Annual Returns for any five consecutive financial years.
- If the tribunal has the opinion that it is just and equitable to wound up LLP.
Procedure of Winding Up of LLP
- A resolution for winding up of LLP needs to be passed and filed with the registrar within 30 days.
- When you pass the resolution of winding up of LLP, the voluntary winding up will commence.
- After resolution, the majority of partners shall make a declaration verified by an Affidavit to the effect that LLP has no debt or that it will be in position to pay its debts in full within a specified period.
- Along with that following documents must be filed within 15 days of passing of the resolution :
a. Statement of assests and liabilities for the time period from last accounts closure to the date of winding up of LLP attested by atleast two partners.
b. Report of valuation of assests
- Creditors are required to provide their opinion on winding up of LLP within 30 days of receipt of request for approval for winding up.
- LLP liquidator must be appointed within thirty days of passing of resolution. It is the duty of LLP liquidator to perform the functions and duties for winding up of LLP.
- Filing of winding up report by LLP Liquidator stating the manner in which winding up of LLP has been conducted and property of the LLP has been disposed off.
- Dissolution of LLP will take place if the tribunal is satisfied that proper procedure have been followed in the winding up of LLP and Registrar will publish it in the official Gazette that the LLP stands dissolved.