LIMITED LIABILITY PARTNERSHIP-PART-XXV - (Inspector's Report in Investigation)

[Dr. Sanjiv Agarwal]

Section 49 of the LLP Act provides as follows - The inspectors may, and if so directed by the Central Government, shall make interim reports to that Government, and on the conclusion of the investigation, shall make a final report to the Central Government and any such report shall be written or printed, as the Central Government may direct.

The Central Government

• shall forward a copy of any report (other than an interim report) made by the inspectors to the limited liability partnership at its registered office, and also to any other entity or person dealt with or related to the report; and
• may, if it thinks fit, furnish a copy thereof, on request and on payment of the prescribed fee, to any person or entity related to or affected by the report.

Section 49 of LLP Act, 2008 seeks to provide that an inspector investigating an LLP may, and if so directed by the Central Government, shall make interim reports to that Government in relation to an investigation carried out by him. It further seeks to provide that on conclusion of the investigation, a final report shall be made to the Central Government by the inspector. This section further seeks to provide that the Central Government shall forward a copy of the report other than an interim report to the concerned LLP or related entity or persons. A copy of such report may also be furnished to any person or entity related to or affected by the report on the request and on payment of prescribed fee. Section 49 deals with inspector's report which could be interim or final as the Central Government may have directed. Report

[Sub-section (1) ]

If any interim report is made, inspector shall make a final report on the conclusion of investigation and such report shall be made to Central Government. The report has to be written or printed as per the direction of the Central Government. Under sub-section (1), inspector's report shall be governed by directions of the Central Government in respect to issue of interim or final report and whether such report be written or printed.

It may be noted that such inspection reports shall be considered as evidence admissible in any judicial proceedings as an opinion of the inspector who carried out the investigation. What should be contained in inspection report is the discretion of inspector based upon his judgment and findings. The notes of examinations on oath may form part of the report.

Law does not fix any time limit for submitting the report. In case report is not submitted within the time administratively fixed, it does not bring the investigation to an end. It is not obligatory on Government to prescribe manner in which report is to be made, nor it is necessary to fix a time-limit: New Central Jute Mills Co. Ltd. v. Deputy Secretary (1966) 36 Comp Cas. 512 (Cal). There is nothing judicial or quasi-judicial in the report of the inspector. The inspector only investigates and report and do not decide whether there is a prima facie case: SBA Properties Ltd. In re (1967) 2 All Er 615 and Pergamon Press Ltd. In re (1970) 3 All Er 535 (CA).

There is no manner of doubt that for an effective enquiry the inspector is bound to take the assistance of a number of persons. It will be sufficient if the inspector !himself consider the material collected by the assistants engaged by him for the said purpose and thereafter prepares his report: Titagarh Paper Mills Co. Ltd. v. Union of India (1986) 59 Comp Cas. 94 (Cal); New Central jute Mills Co. Ltd. v. Deputy Secretary (1966) 36 Comp Cas. 512 (Cal).

Submission of Report [Sub-section (2)]

According to sub-section (2), the Central Government shall forward a copy of the report to the LLP. It shall also send the report to other entity or person dealt with or related to the report. It may provide a copy of the report to any person or entity related to or affected by the report on such request on payment of prescribed fee.

The Central Government shall forward a copy of the final report made by the inspector to the LLP at its registered office. The final report is also required to be sent to any other entity or persons dealt with in or related to the report. It may be noted that copy of interim report is not required to be sent. The report is to be sent at registered office of LLP.

If the report of inspector is itself containing relevant extracts from the evidence, it could not be contended reasonably that the copies of the evidence must be furnished to the company: Titagarh Paper Mill Co. Ltd. (supra)

The copies of report are to be forward to LLP and other persons by the Central Government and not by the inspector . Though there is no specific provision like section 241(2) (d) of Companies Act 1956, if the inspector was appointed by Tribunal or Court under section 43, the report of inspector should be forwarded to such Tribunal or Court, as the case may be .

Clause (b) of sub-section (2) provided for Central Government furnishing copy of report on request and upon payment of prescribed fee to any person or entity related to a an affected by the report.

The Central Government may, if it thinks fit, furnish a copy of report on request and on payment of the prescribed fee to the persons specified in sub-section (2). The fees payable for furnishing a copy of the report of the inspector under this section is prescribed under rule 30.