Streamlined LLP Closure Process under MCA Notification 2024

In the budget presented on 23rd July 2024, the Hon’ble Finance Minister announced that the Centre for Processing Accelerated Corporate Exit C-PACE LLP India services will be extended to assist Limited Liability Partnerships in the LLP closure process. It is a welcome step taken by the government as a part of its initiative of ease of doing business in India.

Following this announcement, the Ministry of Corporate Affairs (MCA) issued Notification No. 475(E) dated 5th August 2024, introducing the Limited Liability Partnership (Amendment) Rules, 2024 (LLP Amendment Rules) to further amend the Limited Liability Partnership Rules, 2009 (LLP Rules).

Effective from 27th August 2024, the LLP Amendment Rules aim to streamline filings and expedite the LLP closure process, making it easier for LLPs to voluntarily dissolve while complying with statutory requirements.

Key Highlights of the LLP Amendment Rules 2024

The LLP Amendment Rules 2024 introduced important revisions to Rule 37 of the LLP Rules to improve the LLP closure process:

Insertion of “Centre for Processing Accelerated Corporate Exit”:

• In Sub-rule (1), Clause (b), and the first proviso, the term “Registrar” is now followed by “the Centre for Processing Accelerated Corporate Exit.”
• An Explanation has been added defining the Centre for Processing Accelerated Corporate Exit as the office established by the Central Government under notification S.O. 1269(E) dated 17th March 2023, in accordance with sections 396(1) and (2) of the Companies Act, 2013.

Revised Sub-rules (3) and (4)

• Sub-rule (3) and Sub-rule (4) now include provisions where “the Registrar” is supplemented by “or the Centre for Processing Accelerated Corporate Exit, as the case may be,” enhancing clarity and efficiency in the LLP closure process.

These changes, outlined in the MCA notification LLP closure, significantly reduce procedural delays and align with ease of doing business India initiatives, providing a more transparent and accelerated path for voluntary LLP closure.

Source:

Ministry of Corporate Affairs, Notification No. 475(E), dated 5th August 2024