A person is liable if, in any document required under this Act, he makes a statement that is either:
1. False in material particulars (and he knows it to be false), OR
2. Omits a material fact (and he knows the fact is material)
## Punishment
Component
Quantum
Imprisonment
Up to 2 years
Fine
Not less than ₹1 lakh, extendable up to ₹5 lakhs
> Note: Both imprisonment AND fine are imposable (the word 'and' indicates cumulative punishment).
## Key Ingredients
Statement must be in a document required under the LLP Act
Materiality — the falsity or omission must relate to a material particular/fact
Knowledge — the maker must know of the falsity / know the fact is material (i.e., mens rea)
Worked example
### Example 1
Q: Mr. D, a DP of XYZ LLP, knowingly states an inflated capital contribution in the LLP's annual return to mislead lenders. What punishment may apply?
A: Section 37 applies — false statement in a material particular, with knowledge. Punishment: imprisonment up to 2 years AND fine between ₹1 lakh and ₹5 lakhs.
### Example 2
Q: Mr. E omits to disclose an existing material litigation against an LLP in a document filed with ROC, knowing the omission is material. Is Section 37 attracted?
A: Yes. Knowingly omitting a material fact in a document required under the LLP Act squarely attracts Section 37. Same punishment as above applies.
⚠️ Common exam mistakes
Forgetting that the minimum fine under Section 37 is ₹1 lakh — not zero.
Treating the offence as a fine-only offence — imprisonment can also be imposed (and the conjunction is 'and' not 'or').
Ignoring the knowledge/mens rea requirement — innocent inaccuracies do not attract Section 37.
Bare-Act text Section 37 · The Limited Liability Partnership Act, 2008 · click to expand
Section 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.