The Ministry of Corporate Affairs in India has recently rolled out General Circular No.-03/2024, offering a much-needed respite to Limited Liability Partnerships (LLPs) concerning the filing of Form No. LLP BEN-2 and LLP Form No. 4D. This circular is a proactive step aimed at streamlining compliance and facilitating the transition to MCA-21 version-3, all while ensuring a smoother reporting process for LLPs.

Background: The genesis of this circular can be traced back to prior notifications by the Ministry, particularly the Limited Liability Partnership (Significant Beneficial Owners) Rules, 2023, and the Limited Liability Partnership (Third Amendment) Rules, 2023. These regulatory frameworks introduced forms LLP BEN-2 and LLP Form No. 4D, which play a pivotal role in declarations under the Companies Act, 2013.

Extension of Deadline: To further incentivize compliance among LLPs amidst the transition from MCA-21 version-2 to version-3, the competent authority has decided to extend the deadline for filing Form LLP BEN-2 and LLP Form No. 4D. Notably, this extension comes with the significant benefit of waiving additional fees, thus alleviating the financial strain on LLPs.

Duration of Extension: LLPs now have until 01.07.2024 to submit the aforementioned forms without incurring any further additional fees. This extension provides a reasonable timeframe for LLPs to ensure compliance with regulatory requirements, thereby fostering a smoother transition and operational continuity.

An Overview of LLP BEN-2 & LLP Form No. 4D

1. LLP BEN-2: This form, introduced under the Limited Liability Partnership (Significant Beneficial Owners) Rules, 2023, serves as a means to file a Return to the Registrar regarding declarations under section 90 of the Companies Act, 2013. It aids in identifying individuals with significant control or economic interest in the LLP.
2. LLP Form No. 4D: Prescribed under the Limited Liability Partnership (Third Amendment) Rules, 2023, this form is essential for filing a Return to the Registrar regarding the declaration of beneficial interest in contributions received by the LLP. It helps track beneficial interests in contributions received, irrespective of their source.

Relaxation Measures by MCA: LLPs can now file Form LLP BEN-2 and LLP Form No. 4D without incurring additional fees up to 15.05.2024. These forms will be accessible in version-3 for filing starting April 15, 2024. The MCA’s relaxation measures are a response to the transition of the MCA-21 portal from version-2 to version-3, aimed at promoting LLP compliance.

Impact & Benefits for LLPs

1. Financial Savings: By waiving additional fees, LLPs can save on costs, easing the burden of compliance and helping maintain cash flow.
2. Extended Deadline: The extended deadline allows LLPs more time to gather necessary information, seek professional advice if required, and ensure accurate filing without rushing. This promotes smoother compliance and reduces the risk of mistakes or penalties. These measures underscore the MCA’s commitment to supporting LLPs and creating a favorable business environment.

In conclusion, the recent circular issued by the Ministry of Corporate Affairs is a welcome relief for LLPs, offering both time and financial benefits. It underscores the government’s commitment to fostering a conducive regulatory environment while ensuring compliance with legal obligations. As LLPs navigate these changes, it’s crucial to leverage this extension wisely and ensure seamless adherence to regulatory requirements.