PENALTIES IN LLP
No.
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Title
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Section
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Provision
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Penalty for Non - Compliances
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1.
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No. of Designated Partners
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7(1)
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Every Limited Liability Partnership shall have at least two designated partners who are individuals and at least one of them shall be a resident in India.
Provided that in case of a Limited Liability Partnership in which all the partners are bodies corporate or in which one or more partners are individuals and bodies corporate, at least two individuals who are partners of such limited liability partnership or nominees of such bodies corporate shall act as designated partners.
Explanation.—For the purposes of this section, the term “resident in India” means a person who has stayed in India for a period of not less than one hundred and eighty-two days during the immediately preceding one year.
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The Limited Liability Partnership and its every partner shall be punishable with fine which shall not be less than Rs 10000 but which may extend to Rs 5,00,000.
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2.
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Consent of Designated Partners
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7(4)
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Every Limited Liability Partnership shall file with the Registrar the particulars of every individual who has given his consent to act as designated partner in such form and manner as may be prescribed within thirty days of his appointment.
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The Limited Liability Partnership and its every partner shall be punishable with fine which shall not be less than Rs. 10,000 but which may extend to Rs. 1,00,000.
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3.
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Compliances for being Designated Partners
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7(5)
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An individual eligible to be a designated partner shall satisfy such conditions and requirements as may be prescribed.
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The Limited Liability Partnership and its every partner shall be punishable with fine which shall not be less than Rs. 10,000 but which may extend to Rs. 1,00,000.
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4.
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Liability of Designated Partners
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8
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Unless expressly provided otherwise in this Act, a designated partner shall be—
(a) responsible for the doing of all acts, matters and things as are required to be done by the Limited Liability Partnership in respect of compliance of the provisions of this Act including filing of any document, return, statement and the like report pursuant to the provisions of this Act and as may be specified in the Limited Liability Partnership agreement; and
(b) liable to all penalties imposed on the Limited Liability Partnership for any contravention of those provisions.
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The Limited Liability Partnership and its every partner shall be punishable with fine which shall not be less than Rs. 10,000 but which may extend to Rs. 1,00,000.
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5.
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Vacancy in Designated Partner
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9
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A Limited Liability Partnership may appoint a designated partner within thirty days of a vacancy arising for any reason and provisions of sub-section (4) and sub-section (5) of section 7 shall apply in respect of such new designated partner :
Provided that if no designated partner is appointed, or if at any time there is only one designated partner, each partner shall be deemed to be a designated partner
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The Limited Liability Partnership and its every partner shall be punishable with fine which shall not be less than Rs. 10,000 but which may extend to Rs. 1,00,000.
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6.
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Statement by professional regarding Compliances of Incorporation
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11(1)
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For a Limited Liability Partnership to be incorporated,—
(c) there shall be filed along with the incorporation document, a statement in the prescribed form, made by either an advocate, or a Company Secretary or a Chartered Accountant or a Cost Accountant, who is engaged in the formation of the Limited Liability Partnership and by anyone who subscribed his name to the incorporation document, that all the requirements of this Act and the rules made there under have been complied with, in respect of incorporation and matters precedent and incidental thereto.
If a person makes a statement under clause (c) of sub-section (1) which he—
(a) knows to be false; or
(b) does not believe to be true
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The person making such false or untrue statement shall be punishable with imprisonment for a term which may extend to 2 years and with fine which shall not be less than Rs 10,000 but which may extend to Rs 5,00,000.
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