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Auditor refuses appointment at AGM

Aditya Jain (Final (New) November 2011) (763 Points)

28 October 2011

How can a Auditor refuse his Appointment in AGM while the company is already required to obtain a consent from him before joining to act as Auditor if Appointed . Once the company obtains a consent from Auditor before passing a resolution (which is statutory requirement) then how can he later refuse to be appointed . What is the use of giving a consent then ?

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3 Replies

REVATI (B.com,CA Final) (Proprietor) (153 Points)
Replied 29 October 2011

No consent is obtained before the appointment of the auditor. I think ur getting confused betweem auditor and director. Consent is required to be given by director of a public company before his appointment.

Provisions for the auditor are as follows:

u/s 224: Co gives the notice to auditor within 7 days of appointment (i.e. 7 days after passing the resolution) The Auditor then within 30 days of receipt of the notice from the co wrt the appointment intimates the ROC in form 23B of the approval or rejection of the appointment.

i hope this makes it clear, that the auditor may or may not accept the appointment after the resolution is passed.

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REVATI (B.com,CA Final) (Proprietor) (153 Points)
Replied 29 October 2011

As regards the certificate u/s 224(1B) i dont think( though it looks so, prima facie) that the giving of the certificate means the approval of the auditor wrt to the appointment. In my opinion..it may rarely happen, but the Sec 224 does preserve the right, even after the appointment by the co, for the auditor to decide on the appointment irrespective of the certificate furnished