New Delhi, Apr 18 (KNN) The Ministry of Corporate Affairs (MCA) has barred entities carrying on manufacturing activities from adopting the Limited Liability Partnership (LLP) structure.

The fate of more than 10,000 existing LLPs engaged in manufacturing also hangs in the balance.

The ministry has said that LLPs can’t carry out manufacturing and allied services. While it allowed LLPs to carry out trade, profession, services, and occupation under the LLP Act 2008, it has excluded manufacturing and allied services.

The clarification has reportedly created confusion among LLPs.

The term ‘business’ as defined under section 2(1)(e) of the LLP Act includes trade, profession, service and occupation.

In the past, manufacturing entities were allowed to set shop as LLPs.

The government in its monthly report put out data on economic sector-wise classification of LLPs till December last year.

The MCA’s reports for the first two months of this year did not disclose information on LLPs. (KNN/JM)