34. Maintenance of books of account, other records and audit, etc.—(1) The limited liability
partnership shall maintain such proper books of account as may be prescribed relating to its affairs for
each year of its existence on cash basis or accrual basis and according to double entry system of
accounting and shall maintain the same at its registered office for such period as may be prescribed.
(2) Every limited liability partnership shall, within a period of six months from the end of each
financial year, prepare a Statement of Account and Solvency for the said financial year as at the last day
of the said financial year in such form as may be prescribed, and such statement shall be signed by the
designated partners of the limited liability partnership.
(3) Every limited liability partnership shall file within the prescribed time, the Statement of Account
and Solvency prepared pursuant to sub-section (2) with the Registrar every year in such form and manner
and accompanied by such fees as may be prescribed.
(4) The accounts of limited liability partnerships shall be audited in accordance with such rules as
may be prescribed:
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Provided that the Central Government may, by notification in the Official Gazette, exempt any class
or classes of limited liability partnerships from the requirements of this sub-section.
1
[(5) Any limited liability partnership which fails to comply with the provisions of sub-section (3),
such limited liability partnership and its designated partners shall be liable to a penalty of one hundred
rupees for each day during which such failure continues, subject to a maximum of one lakh rupees for the
limited liability partnership and fifty thousand rupees for every designated partner.
(6) Any limited liability partnership which fails to comply with the provisions of sub-section (1),
sub-section (2) and sub-section (4), such limited liability partnership shall be punishable with fine which
shall not be less than twenty-five thousand rupees, but may extend to five lakh rupees and every
designated partner of such limited liability partnership shall be punishable with fine which shall not be
less than ten thousand rupees, but may extend to one lakh rupees.]
2
[34A. Accounting and auditing standards.—The Central Government may, in consultation with
the National Financial Reporting Authority constituted under section 132 of the Companies Act, 2013
(18 of 2013),--
(a) prescribe the standards of accounting; and
(b) prescribe the standards of auditing,
as recommended by the Institute of Chartered Accountants of India constituted under section 3 of the
Chartered Accountants Act, 1949 (38 of 1949), for a class or classes of limited liability partnerships.]
35. Annual return.—(1) Every limited liability partnership shall file an annual return duly
authenticated with the Registrar within sixty days of closure of its financial year in such form and manner
and accompanied by such fee as may be prescribed.
3
[(2) If any limited liability partnership fails to file its annual return under sub-section (1) before the expiry of
the period specified therein, such limited liability partnership and its designated partners shall be liable to a penalty
of one hundred rupees for each day during which such failure continues, subject to a maximum of one lakh rupees
for the limited liability partnership and fifty thousand rupees for designated partners.]
36. Inspection of documents kept by Registrar.—The incorporation document, names of partners
and changes, if any, made therein, Statement of Account and Solvency and annual return filed by each
limited liability partnership with the Registrar shall be available for inspection by any person in such
manner and on payment of such fee as may be prescribed.
37. Penalty for false statement.—If in any return, statement or other document required by or for the
purposes of any of the provisions of this Act, any person makes a statement—
(a) which is false in any material particular, knowing it to be false; or
(b) which omits any material fact knowing it to be material,
he shall, save as otherwise expressly provided in this Act, be punishable with imprisonment for a term
which may extend to two years, and shall also be liable to fine which may extend to five lakh rupees but
which shall not be less than one lakh rupees.
38. Power of Registrar to obtain information.—(1) In order to obtain such information as the
Registrar may consider necessary for the purposes of carrying out the provisions of this Act, the Registrar
may require any person including any present or former partner or designated partner or employee of a
limited liability partnership to answer any question or make any declaration or supply any details or
particulars in writing to him within a reasonable period.
(2) In case any person referred to in sub-section (1) does not answer such question or make such
declaration or supply such details or particulars asked for by the Registrar within a reasonable time or
1. Subs. by Act 31 of 2021, s. 13, for sub-section (5) (w.e.f. 1-4-2022).
2. Ins. by s. 14, ibid., (w.e.f. 1-4-2022).
3. Subs. by s. 15, ibid., for sub-sections (2) and (3) (w.e.f. 1-4-2022).
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time given by the Registrar or when the Registrar is not satisfied with the reply or declaration or details or
particulars provided by such person, the Registrar shall have power to summon that person to appear
before him or an inspector or any other public officer whom the Registrar may designate, to answer any
such question or make such declaration or supply such details, as the case may be.
(3) Any person who, without lawful excuse, fails to comply with any summons or requisition of the
Registrar under this section shall be punishable with fine which shall not be less than two thousand rupees
but which may extend to twenty-five thousand rupees.
1
[39. Compounding of offences.—(1) Notwithstanding anything contained in the Code of Criminal
Procedure, 1973 (2 of 1974), the Regional Director or any other officer not below the rank of Regional
Director authorised by the Central Government may compound any offence under this Act which is
punishable with fine only, by collecting from a person reasonably suspected of having committed the
offence, a sum which may extend to the amount of the maximum fine provided for the offence but shall
not be lower than the minimum amount provided for the offence.
(2) Nothing contained in sub-section (1) shall apply to an offence committed by a limited liability
partnership or its partner or its designated partner within a period of three years from the date on which
similar offence committed by it or him was compounded under this section.
Explanation.--For the removal of doubts, it is hereby clarified that any second or subsequent offence
committed after the expiry of the period of three years from the date on which the offence was previously
compounded, shall be deemed to be the first offence.
(3) Every application for the compounding of an offence shall be made to the Registrar who shall
forward the same, together with his comments thereon, to the Regional Director or any other officer not
below the rank of Regional Director authorised by the Central Government, as the case may be.
(4) Where any offence is compounded under this section, whether before or after the institution of any
prosecution, intimation thereof shall be given to the Registrar within a period of seven days from the date
on which the offence is so compounded.
(5) Where any offence is compounded before the institution of any prosecution, no prosecution shall
be instituted in relation to such offence.
(6) Where the compounding of any offence is made after the institution of any prosecution, such
compounding shall be brought by the Registrar in writing, to the notice of the court in which prosecution
is pending and on such notice of the compounding of the offence being given, the offender in relation to
which the offence is so compounded shall be discharged.
(7) The Regional Director or any other officer not below the rank of Regional Director authorised by
the Central Government, while dealing with the proposal for compounding of an offence may, by an
order, direct any partner, designated partner or other employee of the limited liability partnership to file or
register, or on payment of fee or additional fee as required to be paid under this Act, such return, account
or other document within such time as may be specified in the order.
(8) Notwithstanding anything contained in this section, if any partner or designated partner or other
employee of the limited liability partnership who fails to comply with any order made by the Regional
Director or any other officer not below the rank of Regional Director authorised by the Central
Government, under sub-section (7), the maximum amount of fine for the offence, which was under
consideration of Regional Director or such authorised officer for compounding under this section shall be
twice the amount provided in the corresponding section in which punishment for such offence is
provided.]
40. Destruction of old records.—The Registrar may destroy any document filed or registered with
him in physical form or in electronic form in accordance with such rules as may be prescribed.
41. Enforcement of duty to make returns, etc.—(1) If any limited liability partnership is in default
in complying with—
1. Subs. by Act 31 of 2021, s. 16, for section 39 (w.e.f. 1-4-2022).
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(a) any provisions of this Act or of any other law which requires the filing in any manner with the
Registrar of any return, account or other document or the giving of notice to him of any matter; or
(b) any request of the Registrar to amend or complete and resubmit any document or to submit a
fresh document,
and fails to make good the default within fourteen days after the service on the limited liability
partnership of a notice requiring it to be done, the Tribunal may, on application by the Registrar, make an
order directing that limited liability partnership or its designated partners or its partners to make good the
default within such time as specified in the order.
(2) Any such order may provide that all the costs of and incidental to the application shall be borne by
that limited liability partnership.
(3) Nothing in this section shall limit the operation of any other provision of this Act or any other law
imposing penalties in respect of any default referred to in this section on that limited liability partnership.