Condonation of Delay under Companies Act now applicable to LLPs: MCA [Read Notification]

LLPs - Companies Act - MCA - Central Government - Taxscan

The Central Government last Thursday published new directions to include Limited Liability Partnerships (LLPs) in the condonation of delay scheme available under the Companies Act 2013.

Section 460 under the Companies Act 2013, states that,

            “a) where any application required to be made to the Central Government under any provision of this Act in respect of any matter is not made within the time specified therein, that Government may, for reasons to be recorded in writing, condone the delay; and

(b) where any document required to be filed with the Registrar under any provision of this Act is not filed within the time specified therein, the Central Government may, for reasons to be recorded in writing, condone the delay.

Condonation of Delay Scheme came into existence in 2018 so as to provide one final opportunity to the directors of the defaulting companies who due to the reason of the non-filing of financial statements and annual returns were held liable and disqualified. With this new directive, directors of LLPs will now get the benefit of condoning the delay.

A few months ago, MCA, with an intent to crackdown on shell companies, had disqualified more than two lakh directors of shell companies within a span of 15 days, for not filing their financial statements or annual returns for two straight years, violating provisions of the Companies Act, 2013.

Such companies / LLPs which have been struck off /whose names have been removed from the register of companies under section 248(5) of the Act can take advantage of the Scheme.

On adopting the above scheme, the concerned Registrar will withdraw all the pending the prosecution(s) for all documents filed under the scheme. “However, this scheme is without prejudice to action under section 167(2) of the Act or civil and criminal liabilities, if any, of such disqualified directors during the period they remained disqualified.”

Subscribe Taxscan Premium to view the Judgment

taxscan-loader