An LLP can close down its business or when it is not carrying on any business operations since its incorporation or for the span of 1 year or more then it can apply before the Registrar of Companies for declaring the LLP as defunct and for striking off its name from the Register of LLPs.
According to Rule 37(1) (b) of the LLP Rules, 2009, an LLP is required to file the e-Form 24 for voluntary striking off the name of LLP.
Procedure of voluntary strike-off of LLP
Resolution to strike off of LLP by all partners
The first step to strike off the name of LLP is to hold a meeting of all partners of LLP and they shall pass a resolution to strike off the LLP in such meeting.
Moreover, all the partners must authorize one of the partners to undertake all the subsequent steps of process of strike-off.
Cease business operations of LLP
Subsequently, the LLP shall close all of its business operations and pay off all of its liabilities.
Close the Bank Account of LLP
Thereafter, the LLP has to close all of its bank accounts and thus it has to procure a evidentiary document that the accounts have been closed.
Preparation of necessary documents and ensure filing of required annual compliances
Before filing the e-form 24, LLP must prepare the following documents that are required to be attached in the same form –
- Acknowledgment of Latest ITR filed by the LLP
- Statement of Accounts showing that LLP has Nil assets and Nil liabilities (shall be certified by practicing CA/CS not earlier than 30 days from the date of filing E-form 24)
- Authority to make the application duly signed by all partners (Board Resolution)
- Affidavit & Indemnity Letter signed by all the partners
- Certificate of Bank closure (duly signed)
Moreover, the LLP must ensure that it has fulfilled all of its mandatory LLP compliances that are filing of Annual Return, Statement of Solvency, Income Tax Return or any other, if applicable.
File E-Form 24 – Application for Strike-Off
The last step is to download the e-form 24 from the website of MCA i.e. https://www.mca.gov.in/ . Then fill the form and attach the required documents. Afterwards, click on check form it will manifest if there will be any error in the form otherwise it will show no error is detected.
Thereafter, attach the DSC of authorized partner and click on prescrutiny then it will manifest if there will be any error in the form otherwise it will show prescrutiny is successful.
Lastly, upload the form on the MCA portal.
Approval by Registrar
Subsequently, the Registrar shall verify the form and documents attached thereto. If he is satisfied that the form is correct in all respect then he shall strike-off the LLP and it will be intimated to the partners through mail.
Consequently, an LLP which has neither started its business operations or has ceased all of its business operations can voluntarily strike off the LLP by following the above-mentioned steps.
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