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NCLT directs to pay INR One Lakh for Revival of Struck down LLP [Read Order]

Struck down LLP - LLP - Taxscan

The National Company Law Tribunal (NCLT) has directed the Limited Liability Partnership ( LLP ) to pay INR 1,00,000/- for the revival of the struck down Limited Liability Partnership ( LLP ).

In the case of Manish Daga vs. Registrar of the company, the NCLT ordered the registrar of the company to restore the original position of the company as if that company’s name was never struck off. And the appellant was directed to submit all the appropriate fee and documents with the Registrar of the Company (ROC) as ordered by it within 45 days.

The appellant was a Limited Liability Partnership (LLP) company, which is a hybrid business entity wherein it comprises the elements of a partnership and a company.

In case because of the internal dispute between the partners, the LLP could fail to file the balance sheet and because of the same, the name of the company was struck off from the register.

The respondent contended that in the case of compulsory striking off the Limited Liability Partnership (LLP), Section 75 read with Rule 37(1) of the Limited Liability Partnership Rules, 2009 (“LLP Rules”), which states that: 

“According to Section 75 of the Limited Liability Partnership Act, 2008 (“LLP Act”) where the registrar has the reasonable opportunity to believe that the LLP is not carrying on business or its operation in accordance with the provisions of the law, the name of the LLP may be struck off the register of LLP in such manner as may be prescribed.”

Rule 37(1) of the Limited Liability Partnership Rules, 2009 (“LLP Rules”) provides the following manner in which an LLP may be struck off the register of LLP:

Where the LLP is not carrying on any business or profession for the period of 2 (two) years or more and the registrar has the reasonable cause to believe the same, the registrar can suo moto take the action and send notices to the concerned LLP and all its partners specifying his intention to strike off its name from register.

The issue raised in this case was whether the position of the LLP company can be restored after it is struck off or not?

The National Company Law Tribunal (NCLT) comprising of a Technical Member, Mr. Virendra Kumar Gupta and a Judicial Member, Mr. Madan B Gosavi directed the Limited Liability Partnership (LLP) to pay INR 1,00,000/- for the revival of the struck down Limited Liability Partnership (LLP). And at the same time ordered the registrar of the company to restore the original position of the company as if that company’s name was never struck off. And the appellant was directed to submit all the appropriate fee and documents with the Registrar of the Company (ROC) as ordered by it within 45 days.

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