Home Case Index All Cases Companies Law Companies Law + Tri Companies Law - 2017 (4) TMI Tri This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (4) TMI 674 - Tri - Companies LawRemoval of Petitioner firm as auditor of Respondent No.2 Company - Held that:- Though the Petitioner was not ratified in AGM held on 26.09.2016, Principles of Natural Justice demands that he should have been provided with sufficient opportunity before his non-ratification. Auditor acts as a bridge between management and shareholders of the Company and is an important professional in the whole eco system of the corporate world. Therefore, removal/non-ratification of the Auditor without prior notice/seeking his comments would not be proper. Before getting into the merits/ rival contention of removal/non-ratification of the Petitioner firm, we are of the prima facie view that the Respondent No. 1 Company is not eligible to be appointed as Auditor of R2 Company as per Explanation 11(b) to Rule 6 to the Companies (Audit and Auditors) Rules, 2014. Therefore, we admit the present CP No. 21/140/HDB/2016 with following declarations/directions: (1) The removal of petitioner firm as the auditor of R2 Company and the appointment of Rl Company as Auditor of R2 Company is improper. (2) We direct the R2 Company to continue the Petitioner firm as the Auditor of R2 Company till the next AGM and subsequently necessary course of action can be taken by R2 Company regarding the continuation of Petitioner firm, in accordance with law. (3) We further direct that R2 Company to take necessary steps to appoint the petitioners' firm as Auditor of R2 Company. (4) We direct the Rl Company to submit all the records available in their possession, if any, and to cooperate with the Petitioner firm to conduct the audit of books of account of R2 Company.
|