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CSEET · Fundamentals of Accounting · Partnership and LLP Accounts

Alpha Consulting LLP has had only one partner for the last 7 months because the other partner left, and no new partner was admitted. It has also filed its Statement of Account and Solvency and annual return every year. Which ground for winding up by the Tribunal under the LLP Act, 2008 is clearly available?

The LLP may be wound up by the Tribunal because the number of partners has been below two for more than six months. Section 64(b) of the LLP Act, 2008 provides this ground. Seven months exceeds the six-month limit, and no filing default exists.

  1. ANumber of partners reduced below two for more than six monthsCorrect
  2. BDefault in filing statements for five consecutive financial years
  3. CThe LLP has changed its partners, which ends its existence
  4. DThe LLP has no perpetual succession

Explanation

Section 64(b) allows winding up if for more than six months the number of partners is below two. Seven months exceeds six. Filing default under Section 64(e) needs five consecutive years and the LLP has filed on time. Under Section 3, change of partners does not affect existence, so the third option is wrong.

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