25 February 2012
dear experts, pls let me knw the following:
regarding form 23B and 23C......
after filing form 23C for cost auditor by the co. does cost auditor require to file Form 23B for intimating to the registrar??? if yes within how much time limit???? if not form 23B then which form cost auditor require to file to intimate to the registrar????
its realy urgent pls let me knw as soon as possible...
In case in cost auditor Form 23B is not required to be filed with ROC.
Within 30 days of receipt of formal letter of appointment from the company, the cost auditor shall inform the Central Government in the prescribed Form-23D, along with a copy of such appointment.
25 February 2012
ajay sir pls carify the followinng:
i need to appoint cost auditor for F.Y 2012-2013 so what is the procedure for that and which dates shall i take it so that no additional fee is paid???
if i m late in filing form 23C and 23D hw much additional fee i m required to pay???
after filing form 23C within which time limit i need to file form 23D???
pls i m very confused solve this query sir its urgent...
PROCEDURE FOR APPOINTMENT/RE-APPOINTMENT OF COST AUDITORS Ministry has reviewed the existing procedure followed by the companies seeking prior approval of the Central Government for appointment of cost auditor under section 233B(2) of the Companies Act, 1956 vide General Circular No. 15/2011 dated April 11, 2011. In supersession of any earlier order/circular issued in this regard, the revised procedure to be followed by the Companies for appointment of a Cost Auditor shall be as under: (a) The company required to get its cost audited under section 233(B)1 of the Companies Act, 1956 shall appoint a cost auditor who is a cost accountant as defined in clause (b) of sub-section (1) of section 2 of the Cost and Work Accountant Act, 1959 and who hold a valid certificate of practice under sub-section (1) of section 6 of the said Act and includes a firm of cost accountants. (b) The Audit Committee of the Board shall be the first point of reference regarding the appointment of cost auditors. (c) The Audit Committee shall ensure that the cost auditor is free from any disqualifications as specified under section 233B(5) read with section 224 and sub-section (3) or sub-section (4) of section 226 of the Companies Act, 1956. (d) While a Cost Auditor shall have the prime responsibility to ensure that he does not violate the limit specified under section 224(1-B) of the Companies Act, 1956, the Audit Committee shall also be responsible for such compliance by the cost auditor. (e) The Audit Committee shall obtain a certificate from the cost auditor certifying his/its independence and arm’s length relationship with the company. (f) The Company shall e-file its application with the Central Government on www.mca.gov.in portal, in the prescribed Form-23C within 90 days from the date of commencement of each financial year, along with the prescribed fee and other documents as per existing practice i.e. (1) Certified copy of Board Resolution proposing appointment of the cost auditor; and (Annexure-I) (2) Copy of Certificate obtained from the Cost Auditor regarding compliance of section 224(1B) of the Companies Act, 1956 (Annexure-II) (g) On filing of application, the same shall be deemed to be approved by the Central Government, unless contrary is heard within 30 days from the date of filing of such application. (h) If within 30 days from the date of filing of such application, the Central Government directs the company to re-submit the said application with such additional information or explanation, as may be specified in that direction, the period of30 days for deemed approval of the Central Government shall be counted from the date of re-submission by the company. (i) After the expiry of 30 days, as the case may be, the company shall issue formal letter of appointment to the cost auditor, as approved by the Board. (j) Within 30 days of receipt of formal letter of appointment from the company, the cost auditor shall inform the Central Government in the prescribed Form-23D, along with a copy of such appointment. (k) The Company shall disclose full particulars of the cost auditor, along with the due date and actual date of filing of the cost audit report by the cost auditor, in its Annual Report for each financial year. (l) In those companies where constitution of an “Audit Committee” of the Board is not required by law, the words “Audit Committee” shall stand substituted by the words “Board of Directors”. The cost auditor has the same powers and duties in relation to the audit of cost accounts, as are provided for statutory auditor under section 227 of the Companies Act, 1956. His remunerations is fixed by the Board of Directors of the Company.
PENALITIES As per General Circular No. 15/2011, dated 11.04.2011, if a company contravenes any provisions of this circular (procedure for appointment of cost auditor), the company and every officer thereof who is in default, including the persons referred to in sub-section (6) of section 209 of the Companies Act, 1956 shall be punishable as provided under sub section (2) of section 642 read with sub-section (5) and (7) of section 209 and sub-section(11) of section 233B of the Companies Act, 1956.
Relevant provisions of non compliance by the company under Companies Act, 1956 are as follow: Sub section (5) of section 209 provides that if any of the persons referred to in sub-section (6) fails to take all reasonable step to secure compliance by the company with the requirements of this section, or has by his own willful act been the cause of any default by the company there under, he shall, in respect of each offence, be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to ten thousand rupees, or with both:
Provided that in any proceedings against a person in respect of an offence under this section consisting of a failure to take reasonable steps to secure compliance by the company with the requirements of this section, it shall be a defense to prove that a competent and reliable person was charged with the duty of seeking that those requirements were complied with and was in a position to discharge that duty:
Provided further that no person shall be sentenced to imprisonment for any such offence unless it was committed willfully.
Sub- section (6) of Section 209 provides that the persons referred to in subsection (5) are the following, namely:— (a) where the company has a managing director or manager, such managing director or manager and all officers and other employees of the company; and (b) where the company has neither a managing director nor manager, every director of the company; Sub- section (7) of Section 209 provides that if any person, not being a person referred to in sub-section (6), having been charged by the managing director, manager or Board of directors, as the case may be, with the duty of seeing that the requirements of this section are complied with makes default in doing so, he shall, in respect of each offence, be punishable with imprisonment for a term which my extend to six months, or with fine which may extend to ten thousand rupees, or with both.
RELEVANT PROVISION OF SECTION 642 OF THE COMPANIES ACT 1956 IS AS UNDER:
Sub-section (2) of Section 642 provides that any rule made under sub-section (1) may provide that a contravention thereof shall be punishable with fine which may extend to five thousand rupees and where the contravention is a continuing one, with a further fine which may extend to five hundred rupees for every day after the first during which such contravention continues. NON COMPLIANCE BY COST AUDITOR If default is made by the cost auditor in complying with the aforesaid provisions, he/she shall be punishable with fine which may be extended to Rs. 5000/-.
CAclubindia
