Appointment of auditor to fill casual vacancy.

[Durga Bansal]

Dear Friends,

Greetings of the Day!

In a pvt. ltd. company the existing auditor resigned before the date of AGM. Now the company needs to appoint another auditor.
Please confirm me whether the procedure to be followed will be this or any other compliance needs to be done.
Steps:
1. Take the resignation letter from the existing auditor.
2. Take the consent letter from the new auditor.
3. Hold the Board Meeting and appoint the new auditor.
4. within 3 months hold the EGM and get approval of shareholders for such appointment.
5. File ADT-1 with in 15 days of the Board Meeting.
6. The retiring auditor will file form ADT-3 within 30 days from the date of resignation letter given to the company.

[anjali jain]

adt1 is required within 15days of egm not board meeting

[Durga Bansal]

But appointment is in Board Meeting and not in EGM.

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D*Bansal*

[neha agrawal]

yaah..ADT-1 should be filed after BM

Regards,

Neha Agrawal

[anjali jain]

until and unless it gets approved in the egm auditor cannot be said they are appointed. board is only recommending not appointing

On Monday, June 29, 2015 at 11:02:47 AM UTC+5:30, Durga Bansal wrote:

[Durga Bansal]

So, the appointment date will be the date of EGM?

Further, what will be the SRN NO of relevant form in point 7(b) of e-form ADT-1?

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D*Bansal*

[CS Simranjeet Singh]

it will be the SRN of ADT-3 and yes appointment will be effective from EGM

 

 

With Best Regards?

Simranjeet Singh

Associate Company Secretary

"To know, is to know that you know nothing. that is the meaning of true knowledge."

 

   

[Durga Bansal]

Ok thanks a lot friends, i got it.

[neha agrawal]

M still confused..as board can appoint Auditor to fill casual vacancy..they can excercise all their powers as Auditors as they are appointed.. then how can be the date of their appointment is after EGM???

Regards,

Neha Agrawal

[CS Simranjeet Singh]

Dear Neha i was thinking the same.. but by going the erstwhile Section 224 for casual vacancy appointment ur confusion will be cleared.. as law is not changed but drafted in a new manner..

[anjali jain]

Miss neha

Sec 139(8) says that casual vacancy can be filled by board of director but in case casual vacancy arises out of resignation, the appointment should be approved by shareholders within 3 months. 

Board is only recommended and it needs to be approved by shareholder so date of appointment will be date of egm

On Monday, June 29, 2015 at 11:02:47 AM UTC+5:30, Durga Bansal wrote:

[neha agrawal]

Ms. Anjali,,

Means Auditors cant act in their capacity as Auditor  (from their appointment in B.m till Approval in EGM) in this tenure?? does it mean this???

Regards,

Neha Agrawal

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[neha agrawal]

Simranjeet Sir,

224 (6) (a) The Board may fill any casual vacancy in the office of an auditor; but while any such vacancy continues, the remaining auditor or auditors, if any, may act: Provided that where such vacancy is caused by the resignation of an auditor, the vacancy shall only be filled by the company In general meeting.

(b) Any auditor appointed in a casual vacancy shall hold office until the conclusion of the next annual general meeting.

If board fails to do so then only it has to be filled by Co.

Others Members View on d same please

Regards,

Neha Agrawal

[anjali jain]

yes until and unless they are appointed they cnt act as auditor

On Monday, June 29, 2015 at 11:02:47 AM UTC+5:30, Durga Bansal wrote:

[neha agrawal]

​den why the BOD has given power to fill the vacancy if the Auditor appointed by them cant excercise any powers/rights...

Regards,

Neha Agrawal

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[CA Sumit Parolia]

Dear Neha

I think u are misunderstand the provisions.

If casual vacancy arise because of resignation of auditor then new appointment shall be approved by company at GM within 3 Months recommendation by BOD

and Other then resignation then BOD have power to appoint new Auditor within 30 days

Regards,
ACA SUMIT PAROLIA
S PAROLIA & ASSOCIATES
Practicing Chartered Accountants
Kolkata

E-mail: Ca.pa...@gmail.com

[Durga Bansal]

Dear Sumitji,

We have understood the interpretation correctly but we are a bit confused about the date of appointment whether it will be the date of BM or the date of EGM?

D*Bansal*

[CA Sumit Parolia]

if arise out of resignation then date of EGM otherwise date of BM

Regards,
ACA SUMIT PAROLIA
S PAROLIA & ASSOCIATES
Practicing Chartered Accountants
Kolkata

E-mail: Ca.pa...@gmail.com

[neha agrawal]

(8) Any casual vacancy in the office of an auditor shall--

(i) in the case of a company other than a company whose accounts are subject to audit by an auditor appointed by the Comptroller and Auditor-General of India, be filled by the Board of Directors within thirty days, but if such casual vacancy is as a result of the resignation of an auditor, such appointment shall also be approved by the company at a general meeting convened within three months of the recommendation of the Board and he shall hold the office till the conclusion of the next annual general meeting;

Means both BOD and Members Approval is required for his Appointment..its my interpretation..correct me 

Regards,

Neha Agrawal

[sachin kumar]

If auditors resigned then appointment will effective after approval of member i.e EGM

If any other reason then Board has power to appoint and effective date will be from Board Meeting.

[CA Sumit Parolia]

Neha Ji

BOD has been recommended not appointed. 

If two Directors are recommended two different auditors and at EGM any of them are approved by shareholders. then is these mean both auditor are appointed???

Regards,
ACA SUMIT PAROLIA
S PAROLIA & ASSOCIATES
Practicing Chartered Accountants
Kolkata

E-mail: Ca.pa...@gmail.com

[anjali jain]

yes appointment in case of resignation should be approved by both board and shareholders

On Monday, June 29, 2015 at 11:02:47 AM UTC+5:30, Durga Bansal wrote:

[neha agrawal]

BOD fill the casual vacancy by appointing new auditor in his place within 30 days to take place of retired auditor.. and within 3 monts it has to be approved by members..and till time he will be eligible to excersise all his rights..every casual vacacy is filled by BOD but only in case of Resignation it has to take additionally members approval..it doesnt mean that auditors are not appointed by BOD..to whome the board will appoint will recommend his appointment to be regularised only..the effective date shall be his date of appointment in b.M

Regards,

Neha Agrawal

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[neha agrawal]

Resigned Auditor*

Regards,

Neha Agrawal

[Pradeep Kumar]

I think the date of appointment of new auditor should be the date of BM, because while filling ADT-1, if the difference is more than 30 days between the date of vacancy and new appointment, you will end up in paying additional fee while uploading ADT-1.

Approval (retrospective) in EGM is must in this case.

Other views solicited.

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Thanks & Regards,

Pradeep Kumar M

PRADEEP KUMAR M & ASSOCIATES

Company Secretaries,

#12/3,Sri Sathyasai Krupa,2nd Floor, Vanivilas Road

VV Puram, Bangalore-560004

Mobile-9739315590

Email-cs...@gmail.com

[anjali jain]

case of additional fee will arise if date of filing adt1 is after 15days of date of appointment.

On Monday, June 29, 2015 at 11:02:47 AM UTC+5:30, Durga Bansal wrote:

[neha agrawal]

​ya..completely agree with Pradeep sir..dats wht i am saying date of appointment shall be from date of BM in which he is appointed​

Regards,

Neha Agrawal

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[Durga Bansal]

Does any one have filed the form ADT-1 in case of appointment of auditor to fill casual vacancy?

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D*Bansal*

[anjali jain]

I have appointed auditor in case casual vacancy arised due to resignation

[Durga Bansal]

So dear Ma'am!

What were the different dates in your case i.e. date of BM & Date of EGM & date of Resignation by the auditor? What is the authorised capital of your company and what was the filing fee in your case? Please share.

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D*Bansal*

[anjali jain]

date of resignation was 25/02/2015

date of board meeting was 7/03/2015

date of egm was 02/04/2015 

authorised capital is 8cr

filing fee was 600/-

[Durga Bansal]

date of filing the form ADT-1?

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D*Bansal*

[anjali jain]

03/04/2015

[Durga Bansal]

It simply means the date of appointment is the date of EGM

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[Durga Bansal]

And mr. Pradeep is incorrect.

[Deepak Sadhu]

Hi All

Here are my views where I give an example:

Board meeting done on 28/5/15 by passing BR to appt auditor by filling casual vacancy where they appt auditors

BM minutes as on 28/5/15 whereby convening of EGM mentioning Date, time, venue (20/06/2015, 11.00AM, regd office)

Notice given on 28/5/15

EGM conducted on 20/06/15 where OR is passed. The auditor fills the casual vacancy caused by previous auditor till next AGM

Prior to BM which was held on 28/5/15 a consent letter was given by the auditor as on 21/5/2015 as per sec 139(1) and 141

ADT-1 to be filed within 15 days of auditor appt

Regards

CS Deepak Sadhu

[Arun Jaiswal]

Auditor is not appointed by BOD. In case of casual auditor shall be appointed in EGM by members of the company. If the date of ensuing AGM is within 3 months of the resignation of the earlier auditor then appoin t the auditor in the AGM. 

[Durga Bansal]

Dear Friends,

I tried to file e- form ADT-1 as date of resignation by auditor 01.05.2015 date of BM 10.05.2015 and date of EGM 03.06.2015 and mentioned in the form as date of appointment 03.06.2015; now the fees i have paid for the form is only Rs. 300 as the nominal capital is rs. 1 Lac. So, the date of appointment in such a case will be the date of EGM only.

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D*Bansal*

[neha agrawal]

Freindzz i went to instruction Kit of ADT-1

in that the purpose of the form-On appointment/Reappointment  of an auditor at the AGM..the company shall file a notice of such appointment/Reappointment with Roc within 15 days of meeting in which auditor is appointed/Reappointed..

from this i think date of EGM is date of Appointment

Regards,

Neha Agrawal

[Pradeep Kumar]

Hi Ms Durga, yes, you are right.It should be EGM date.