Provisions relating to Removal/Resignation of Auditor under Section 140 of Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014

S. No.
Relevant provision
Particulars
Compliances
Form required
Due date of filing form
Attachments required
Remarks
1
Section 140(1) of Companies Act, 2013 and rule 7 of the Companies (Audit and Auditors) Rules, 2014
REMOVAL OF AUDITOR
The auditor appointed may be removed from his office before the expiry of his term
(1) Board Meeting to be conducted
(2) The application to the Central Government for removal of auditor shall be made in Form ADT-2
(3) The company shall hold the general meeting within 60 days of receipt of approval of the Central Government for passing the special resolution
Form ADT-2
Form MGT-14
Form ADT-2 Within 30 days of the resolution passed by the Board
Form MGT-14 Within 30 days of passing of special resolution
Before taking any action under this sub-section, the auditor concerned shall be given a reasonable opportunity of being heard
2
Section 140(2) of Companies Act, 2013 and rule 8 of the Companies (Audit and Auditors) Rules, 2014
Resignation of auditor- The auditor who has resigned from the company shall file Form with the company and the Registrar
In case of Govt. Company Statement to be filed with the C &AG, Registrar of Companies and Company Statement should include the reasons of resignation and other relevant facts.
Form ADT-3
Within 30 days from the date of resignation
Resignation letter stating the reason for resigning
3
Section 140(4) of Companies Act, 2013
Removal Of A Person Other Than Retiring Auditor
Special notice shall be required for a resolution at an AGM appointing as auditor a person other than a retiring auditor, or providing expressly that a retiring auditor shall not be re-appointed,
(i)On receipt of notice, the company shall send a copy to the retiring auditor.
(ii) Where notice is given and the retiring auditor makes representation in writing to the company and requests its notification to members of the company, the company shall –
(a) in any notice of the resolution given to members of the company, state the fact of the representation having been made; and
(b) send a copy of the representation to every member of the company to whom notice of the meeting is sent, whether before or after the receipt of the representation by the company,
NA
NA
NA
Except where the retiring auditor has completed a consecutive tenure of five years or ten years
4
Section 140(5) of Companies Act, 2013
Removal Of Auditor – By Tribunal
If Tribunal is satisfied that auditor is directly or indirectly acted in a fraudulent manner, it can direct the Company to change the Auditor.
The tribunal may be satisfied either:
– Suo motu
– Application by other concerned person
– Application by CG
(i) In case Tribunal is satisfied by such application, it shall within 15 days of receipt of such application pass the order for removal of such auditor.
(ii) Another auditor in his place will be appointed by CG
ADT-1
Within 15 days from appointment of auditor
1. Company’s Board resolution copy
2. A written consent from the Auditor
3. Copy of the order of the Tribunal in case Nature of appointment is ‘Auditor appointed by the Tribunal’
Provided further that an auditor, whether individual or firm, against whom final order has been passed by the Tribunal under this section shall not be eligible to be appointed as an auditor of any company for a period of five years from the date of passing of the order and the auditor shall also be liable for action under section 447.
Appointment after vacancy
1
IN CASE OF A GOVT-COMPANY
Section 139(8)(ii) of Companies Act, 2013
Any Casual Vacancy
(i) Casual Vacancy be filled by the Comptroller and Auditor-General of India within 30 days
(ii) In case of failure, the Board of Directors shall fill the vacancy within next 30 days.
ADT-1
Within 15 days from appointment of auditor
1. Copy of the letter of appointment from C&AG
2. Copy of the intimation sent by company
3. Copy of written consent given by auditor
2
IN CASE OF A NON GOVT-COMPANY
(i)
Section 139(8)(i) of Companies Act, 2013
Casual Vacancy out of the resignation
(i) It shall be filled within 30 days by the Board of Directors
(ii) The recommendation so made by the Board shall be approved in a general meeting convened within 3 months from the date of recommendation of the Board.
(iii) He shall hold the office till the conclusion of the next annual general meeting
ADT-1
Within 15 days of the meeting in which the auditor is appointed
1. Company’s resolution copy
2. A written consent from the Auditor
3. Copy of the intimation sent by company
Where a company is required to constitute an Audit Committee under section 177, all appointments, including the filling of a casual vacancy of an auditor under this section shall be made after taking into account the recommendations of such committee.
(ii)
Section 139(8)(i) of Companies Act, 2013
Casual Vacancy arising other than resignation
It shall be filled within 30 days by the Board of Directors
He shall hold the office till the conclusion of the next annual general meeting
ADT-1
Within 15 days of the meeting in which the auditor is appointed
1. Company’s Board resolution copy
2. A written consent from the Auditor
3. Copy of the intimation sent by company
Where a company is required to constitute an Audit Committee under section 177, all appointments, including the filling of a casual vacancy of an auditor under this section shall be made after taking into account the recommendations of such committee.

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