Unlike Company closure, it is mandatory for an LLP to file certain compulsory returns, no matter, the business is operating or not. Penalties and legal action are imposed under the LLP Act to the designated partners for non-filing of due returns on time. LLP continues to exist until there is a formal closure of LLP. LLP must be inactive since one year or does not possess any liability or assets on the date of filing for the closure of LLP. With the consent of all the partners of LLP, an application must be made to the registrar for removing the name from the register of companies. If the LLP possess the assets and bank balance, it can not be removed from the register.
Once, the application for closure of LLP is filed, the process takes 3 to 6 months to completely remove the name from the register of companies. Once approved, the ministry puts up the application for the general public for about one month and later issue an order regarding name removal from the register. The notice of removal is published in the official gazette later by the ministry of corporate affairs. It is mandatory for all the partner to consent for the closure and provide executed affidavits and indemnity stated under LLP guidelines.