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CS Executive · Setting Up of Business, Industrial and Labour Laws · Limited Liability Partnership

Anita Associates LLP failed to file a return required under the LLP Act, and a penalty was imposed on the LLP. The LLP agreement does not mention who handles filings. Anita is a designated partner, Bhuvan is an ordinary partner, and no provision of the Act expressly provides otherwise. Who is liable to the penalty imposed on the LLP for this contravention, in addition to the LLP?

Anita, the designated partner, is liable along with the LLP. Under Section 8, unless the Act expressly provides otherwise, a designated partner is responsible for compliance and filings and is liable to all penalties imposed on the LLP for contravention of the Act's provisions.

  1. AOnly Bhuvan, since ordinary partners handle operations
  2. BAnita as designated partner, being liable to all penalties imposed on the LLP for contravention of the ActCorrect
  3. CNo partner, since only the LLP can be penalised
  4. DOnly the Registrar who accepted the earlier filings

Explanation

Section 8 states that unless the Act expressly provides otherwise, a designated partner is responsible for compliance acts, including filing returns, and is liable to all penalties imposed on the LLP for contravention of those provisions. Anita is therefore liable. Bhuvan, an ordinary partner, is not made liable by Section 8, though Section 76 can reach partners where there is consent, connivance or neglect, which is not stated here.

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