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NCLT allows application filed by Ministry of Corporate Affairs (‘MCA’) u/s 140(5) of the Companies Act, 2013 (‘the Act’) for removal of Company’s statutory auditor; Notes that MCA had initiated an investigation in respect of the Company, and the auditor in his statement to the Inspecting Officer, had admitted that he had not audited the Company’s accounts; On observing that the auditor had issued a certificate in favour of the Company highlights that “the statuary auditor has given false certificate that he audited the Books of Account of the company for the relevant period”; Further notices that the family members of the auditor were shareholders of the Company, which was in stark contrast with Sec. 141(3)(d) of the Act which “…specifically prohibits (appointment of) a statutory auditor whose relative or partner is holding any security or interest of the company”; Upon concluding that the statutory auditor had clearly acted in violation of the statutory provisions orders his removal, directs appointment of an independent auditor, and lists the matter for final argument on February 4:Mumbai NCLT

The order was passed by Shri. V.P. Singh (Member-Judicial) and Shri. Ravikumar Duraisamy (Member-Technical).

CA Nidhi Pandya
Partner

Sudheendra And Company LLP