Rule 37A - Adjudication of penalties - Limited Liability Partnership Rules, 2009

1 [37A. Adjudication of penalties. (1) The Central Government may appoint any of its officers, not below the rank of Registrar, as adjudicating officers for adjudging penalty under the provisions of the Act. (2) Before adjudging penalty, the adjudicating officer shall issue a written notice, to the limited liability partnership, partner or designated partner of a limited liability partnership or any other person who has committed non-compliance or made default under the Act, as the case may be, to show cause, within such period as may be specified in the notice (not being less than fifteen days and not more than thirty days from the date of service thereon), why the penalty should not be imposed on it or him. (3) Every notice issued under sub-rule (2), shall clearly indicate the nature of non-compliance or default under the Act alleged to have been committed or made by such limited liability partnership, its partner or its designated partner, or any other person, as the case may be and also draw attention to the relevant penal provisions of the Act and the maximum penalty which can be imposed on such limited liability partnership, its partners or designated partners or any other person, as the case may be. (4) The reply to such notice shall be filed in electronic mode only within the period as specified in the notice: Provided that the adjudicating officer may, for reasons to be recorded in writing, extend the period referred to above by a further period not exceeding fifteen days, if the limited liability partnership or its partners or designated partners or any other person, as the case may be, satisfies the adjudicating officer that it or he has sufficient cause for not responding to the notice within the stipulated period or the adjudicating officer has reason to believe that the limited liability partnership or its partners or designated partners or any other person has received a shorter notice and did not have reasonable time to give reply. (5) If, after considering the reply submitted by such limited liability partnership or its partners or designated partners, or any other person, as the case may be, the adjudicating officer is of the opinion that physical appearance is required, he shall issue a notice, within a period of ten working days from the date of receipt of reply fixing a date for the appearance of such limited liability partnership, through its authorised representative, or partners or designated partners, or any other person, whether personally or through his authorised representative: Provided that if any person, to whom a notice is issued under sub-rule (2), desires to make an oral representation, whether personally or through his authorised representative and has indicated the same while submitting his reply in electronic mode, the adjudicating officer shall allow such person to make such representation after fixing a date of appearance. (6) On the date fixed for hearing and after giving a reasonable opportunity of being heard to the person concerned, the adjudicating officer may, subject to reasons to be recorded in writing, pass any order in writing as he thinks fit including an order for adjournment: Provided that after the hearing, the adjudicating officer may require the concerned person to submit his reply in writing on certain other issues related to the notice under sub-rule (2), relevant for determination of the default. (7) The adjudicating officer shall pass an order - (a) within thirty days of the expiry of the period specified in sub-rule (2), or of such extended period as referred therein, where physical appearance was not required under sub-rule (5); (b) within ninety days of the date of issue of notice under rule (2), where any person appeared before the adjudicating officer under sub-rule (5): Provided that in case an order is passed after the aforementioned duration, the reasons of the delay shall be recorded by the adjudicating officer and no such order shall be invalid merely because of its passing after the expiry of such thirty days or ninety days as the case may be. (8) Every order of the adjudicating officer shall be duly dated and signed by him and shall clearly state the reasons for requiring the physical appearance under sub-rule (5). (9) The adjudicating officer shall send a copy of the order passed by him to the concerned limited liability partnership, its partner or designated partner or any other person or all of them and to the Regional Director and a copy of the order shall also be uploaded on the website. (10) For the purposes of this rule, the adjudicating officer shall exercise the following powers, namely: - (a) to summon and enforce the attendance of any person acquainted with the facts and circumstances of the case after recording reasons in writing. (b) to order for evidence or to produce any document, which in the opinion of the adjudicating officer, may be useful for or relevant to the subject matter of the inquiry. (11) If any person fails to reply or neglects or refuses to appear as required under sub-rule (5) or sub-rule (10) before the adjudicating officer, the adjudicating officer may pass an order imposing the penalty, in the absence of such person after recording the reasons for doing so. (12) Penalty shall be paid through Ministry of Corporate Affairs portal only. (13) All sums realised by way of penalties under the Act shall be credited to the Consolidated Fund of India. Explanation 1. (a) For the purposes of this rule, the term specified manner shall mean service of documents as specified under sub-section (2) of section 13 and rules made thereunder and details in respect of address (including electronic mail ID) provided in the documents filed in the registry shall be used for communication under this rule. (b) Service of documents on a limited liability partnership or its partners or designated partners or any other person shall include speed post or courier service or in any other manner through electronic transmission, at the registered office and any other address specifically declared by the limited liability partnership for the purpose in such form under sub-rule (3) of rule 16. (c) In case of delivery by post, such service shall be deemed to have been effected at the time at which the document would be delivered in the ordinary course of post. Explanation 2. For the purposes of this rule, it is hereby clarified that the requirement of submission of replies in electronic mode shall become mandatory after the creation of the e-adjudication platform. ] ************** NOTES:- 1. Inserted vide Notification No. G.S.R. 109(E) dated 11-02-2022 w.e.f. 01-04-2022