Limited Liability Partnership (Winding up and Dissolution) Rules, 2010

 
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G.S.R. 266 (E):- In exercise of the powers conferred by section 65 read with section 79 of the Limited Liability Partnership Act, 2008 (6 of 2009), the Central Government hereby makes the following rules:-

1. Short title and commencement.-

(1) These rules may be called the Limited Liability Partnership (Winding up and Dissolution) Rules, 2010.

(2) They shall come into force from the date of publication in the Official Gazette.

2. Definitions.-

(1) In these rules, unless the context otherwise requires,-

(i) "Act" means the Limited Liability Partnership Act, 2008 (6 of 2009);

(ii) "Annexure" means an Annexure to these rules;

(iii) "Bench" means a bench of the Tribunal and includes the Principal Bench;

(iv) "certified", in relation to a copy of a document, means certified as provided in section 76 of the Indian Evidence Act, 1872;

(v) "Code" means the Code of Civil Procedure, 1908;

(vi) "filed" means filed in the office of the Registrar of Tribunal or Bench;

(vii) "LLP" means Limited Liability Partnership;

(viii) "LLPIN" means the Limited Liability Partnership Identification Number as referred to in the Limited Liability Partnership Rules, 2009;

(ix) "LLP Liquidator" means a liquidator appointed in connection with voluntary winding up of a limited liability partnership (LLP) from the panel maintained by the Central Government consisting of the names of practicing chartered accountants, advocates, practicing company secretaries, practicing cost and works accountants or firms or bodies corporate having chartered accountants, advocates, company secretaries, cost and works accountants and such other professionals as may be notified by the Central Government;

(x) "Member" means any judicial member or technical member of the Tribunal;

(xi) "Officer" includes any designated partner, partner, employee of the LLP and any person in accordance with whose directions or instructions the partners of the LLP have been accustomed to act;

(xii) "Officer of the Tribunal" includes a liquidator appointed under these rules;

(xiii) "Official Liquidator" means a Liquidator who, in relation to winding up by Tribunal, is appointed by the Central Government exercise the powers of Official Liquidator and includes Joint, Deputy or Assistant Official Liquidators;

(xiv) "Proceedings" means proceedings and procedures specified in Part VI of these rules and include other proceedings or procedures under the Act or the rules.

(xv) "Registrar of Tribunal" means, the Registrar of the Tribunal, and includes an Additional Registrar, a Deputy Registrar or an Assistant Registrar of the Tribunal or any of its Bench, and such other officer as may be authorized by the President of the Tribunal to perform all or any of the duties assigned to the Registrar of Tribunal under the Act and rules made thereunder;

(xvi) "Section" means a section of the Limited liability Partnership Act, 2008 (6 of 2009);

(xvii) "Summons" means a summons returnable before any Member of the Tribunal;

(xviii) "Tribunal" means the Tribunal as defined in clause (u) of sub-section (1) of section 2 of the Act:

Provided that until the Tribunal is constituted under the Companies Act, 1956, the word "Tribunal" shall be substituted with the words "High Court".

(2) Save as aforesaid, and unless the context otherwise requires, words and expressions contained in these rules shall bear the same meaning as in the Limited liability Partnership Act, 2008.

3. Forms. - The forms annexed to these rules shall be used in all matters to which the forms relate with such variations as may be necessary.

Part II

Modes of winding up

4. Modes of winding up. - The winding up of an LLP may be either voluntary or by the Tribunal.

Part III

Voluntary Winding Up

5. Circumstances in which LLP may be wound up voluntarily.-

(1) Any LLP may be wound-up voluntarily if the LLP passes a resolution to wind up the LLP with approval of at least three-fourths of the total number of its partners:

Provided that where the LLP has creditors, whether secured or unsecured, the winding up shall not take place unless approval of such creditors takes place in pursuance of rule 7.

(2) A copy of the resolution shall be filed with the Registrar within thirty days of passing of such resolution in Form No. 1.

6. Commencement of voluntary winding up and filing up of statement of affairs. -

(1) A voluntary winding up shall be deemed to commence on the date of passing of the resolution for voluntary winding up under rule 5.

(2) The provisions of sub-rule (3) of rule 28 shall, so far as may be, apply to the voluntary winding up as they apply to the winding up by the Tribunal except that the reference to -

(a) the Tribunal shall be omitted;

(b) the liquidator or the Provisional Liquidator shall be construed as reference to the LLP liquidator, and

(c) the "relevant date" shall be construed as reference to the date of commencement of the voluntary winding up.

7. Declaration of solvency in case of proposal to wind up voluntarily.-

(1) Where it is proposed to wind up an LLP voluntarily, the majority of its designated partners (being not less than two) shall make a declaration in Form No. 2 verified by an affidavit to the effect that the LLP has no debt or that it will be able to pay its debts in full within such period, as may be specified in the declaration, but not exceeding one year from the commencement of the winding up.

(2) A declaration made under sub-rule (1) shall have no effect for the purposes of the Act and these rules, unless --

(a) it is delivered to the Registrar for registration in Form No. 3 within fifteen days immediately preceding the date of the passing of the resolution for winding up of LLP;

(b) it contains a statement declaring that the LLP is not being wound up to defraud any person or persons;

(c) it is accompanied by a statement of assets and liabilities prepared in Form No. 4 for the period commencing from the date up to which the last account was prepared and ending with the latest practicable date immediately before the making of the declaration duly attested by at least two designated partners; and

(d) it is accompanied by a report of the valuation of the assets of the LLP prepared by a valuer, if there are any assets of the LLP.

(3) The LLP or its designated partners may repay any dues of the creditors or satisfy the claims of creditors in any manner, before any declaration is made by designated partners under sub-rule (1).

8. Meeting of creditors.-

(1) Where any LLP has creditors, secured or otherwise, such LLP shall, before taking any action for winding up of the LLP, seek approval of such creditors and shall send them, by registered or speed post or any other mode defined in rule 15 of Limited Liability Partnership Rules 2009, a copy of declaration under sub-rule (1) of rule 7, the estimated amount of the claims due to each of the creditors and an offer for creditors to accept such claims.

(2) The creditors shall give to the LLP their opinion in respect of voluntary winding up proposed by the LLP or acceptance of offer made under sub-rule(1) within thirty days of receipt of declaration under sub-rule (1) of rule 7.

(3) Where two-thirds in value of creditors of the LLP referred to in sub-rule (1) give their consent that-

(a) it is in the interest of all the partners and creditors that the LLP be wound up voluntarily by partners, the LLP shall be wound up voluntarily by partners; or

(b) the LLP will not be able to pay for its debts in full from the proceeds of assets to be sold in voluntary winding up and propose that the LLP be wound up voluntarily by creditors, the LLP shall be wound up voluntarily by creditors; or

(c) the LLP will not be able to pay for its debts in full from the proceeds of assets to be sold in voluntary winding up and propose that it will be in the interest of all partners and creditors if the LLP is wound up by the Tribunal, the LLP shall, within fourteen days thereafter, file an application before the Tribunal for winding up:

Provided that where the LLP pays the dues of creditors to their satisfaction, provisions of clause (b) or clause (c), as the case may be, shall not be applicable.

(4) Notice of any decision of creditors in pursuance of this rule shall be given by the LLP to the Registrar in Form No 5 within fifteen days from the date of receipt of consent of the creditors referred to in sub-rule (3).

9. Publication of resolution to wind up voluntarily.-

Where LLP has by resolution resolved for voluntary winding up and consent of creditors under clause (b) of sub-rule (3) of rule 8 is received for voluntary winding up of the LLP, it shall, within fourteen days of the receipt of creditors' consent, give notice of the resolution by advertisement in a newspaper circulating in the district where the registered office or the principal office of the LLP is situated.

10. Appointment and removal of LLP Liquidator.-

(1) The LLP shall within thirty days of -

(a) passing of resolution of voluntary winding up under rule 5, where LLP has no creditors, or

(b) filing of notice intimating the decision of winding up pursuant to sub-rule (4) of rule 8, where it has creditors, with the consent of majority of partners through resolution, appoint a voluntary Liquidator as LLP Liquidator for the purpose of winding up its affairs and fix the remuneration to be paid to the LLP Liquidator.

(2) Where the creditors have given consent under clause (b) or (c) of sub-rule (3) of rule 8, the appointment of LLP Liquidator under this rule shall be effective only after it is approved by two-thirds of the creditors in value of the LLP:

Provided that where such creditors do not approve the appointment of LLP Liquidator appointed by the partners of LLP, creditors shall appoint another LLP Liquidator...

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