Auditor appointment

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shweta madan (Querist)
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13 September 2015 if the previous auditor is filed form 23 b as per old companies act in which auditor are appointed for 1 yr now this is not the case of casual vacancy because the meaning of casual vacancy that resignation be fore their term so now new auditor can be appointed normally without applying casual vacancy am I right????

Pratik Shah

Pratik Shah (Expert)
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14 September 2015 Hi Shweta,

Can you please elaborate your query in detail? Unable to understand your query clearly based on what you have written.
Thanks

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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15 July 2024 Yes, you are correct in your understanding. Let's clarify the appointment of auditors under the Companies Act and the concept of casual vacancy:

### Appointment of Auditors under Companies Act

1. **Appointment by Shareholders**: Auditors of a company are generally appointed by the shareholders at the Annual General Meeting (AGM) or through postal ballot as per the provisions of the Companies Act.

2. **Term of Appointment**: As per the Companies Act, 2013 (and also under earlier provisions), auditors are typically appointed for a term of one year until the conclusion of the next AGM.

3. **Form 23B**: Previously, under the old Companies Act (1956), Form 23B was required to be filed for appointment or reappointment of auditors. This form indicated the appointment was for a one-year term.

### Casual Vacancy vs. Regular Appointment

- **Casual Vacancy**: A casual vacancy occurs when an auditor resigns before completing their term. In such a case, the remaining directors may appoint a new auditor who will hold office until the next AGM, where shareholders will confirm the appointment.

- **Regular Appointment**: If the previous auditor has completed their term (typically one year) as per their appointment at the last AGM, and there is no resignation or casual vacancy, the company can appoint a new auditor through the regular process at the next AGM.

### Conclusion

Since the previous auditor was appointed for a one-year term as per the old Companies Act provisions and there is no resignation or casual vacancy to trigger an immediate replacement, the company can appoint a new auditor at the upcoming AGM through the normal appointment process. This appointment would be for the period until the conclusion of the next AGM, aligning with the usual practice under company law.

It's essential to comply with the specific requirements of the Companies Act, including filing necessary forms and resolutions as per the current provisions applicable under the Companies Act, 2013. Always refer to the latest provisions and seek professional advice if there are any uncertainties regarding auditor appointments and compliance procedures.

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