LLP Strike Off

What is LLP Strike Off?

LLP Strike Off is the legal process by which a Limited Liability Partnership (LLP) ceases to exist and is removed from the official register maintained by the Registrar of Companies (ROC). This process is applicable when the LLP is no longer carrying out any business or is dormant, and the partners wish to close the LLP in a simple and cost-effective manner.

LLP Strike Off

Legal Framework

Section 77 of the Limited Liability Partnership Act, 2008

Rule 37 of the Limited Liability Partnership Rules, 2009

Voluntary Strike-Off Procedure

Eligibility

  • LLP must not have carried out any business activity or must be dormant.
  • All partners must unanimously agree to apply for strike off.
  • The LLP should have no outstanding liabilities.

Procedure

  • Hold a partners’ meeting to approve the proposal for strike off.
  • File Form 24 (Application for striking off LLP’s name) with the Registrar of Companies, signed by all partners.
  • Attach the following documents with Form 24:
  • Statement of accounts or declaration that the LLP has no assets and liabilities.
  • Affidavit stating that the LLP has no pending litigation or prosecution.
  • No Objection Certificate (NOC) from creditors, if any.
  • The Registrar publishes a public notice and waits for any objections.
  • If no objections are received within 30 days, the Registrar strikes off the LLP and issues a notice of strike off.

  • The Registrar of Companies may initiate strike off if:
  • The LLP has not filed annual returns or statements of accounts for two consecutive financial years.
  • The LLP has failed to comply with statutory requirements under the LLP Act.
  • The Registrar will issue a notice to the LLP and, after due procedure, may strike off the LLP from the register.

  • The LLP will cease to exist as a legal entity.
  • All assets, liabilities, and contracts of the LLP will vest with the Registrar of Companies.
  • Partners are relieved from future compliance and liabilities related to the LLP after strike off.

  • Strike off is different from winding up/liquidation; it is suitable for LLPs with no business activities or liabilities.
  • Proper due diligence should be done to ensure all statutory dues, taxes, and liabilities are settled before applying for strike off.
  • Objections from creditors or government authorities can delay or prevent strike off.
  • Professional advice is recommended to ensure compliance and smooth closure of the LLP.

Conclusion

LLP Strike Off is a straightforward and cost-effective mechanism to close an LLP that is no longer operational. It helps partners avoid unnecessary compliance burden and statutory liabilities. Understanding the legal provisions and procedural requirements is essential to ensure a hassle-free strike off.

For expert guidance on LLP strike off, statutory compliance, and related secretarial services, our firm is here to assist you at every step.