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Section 226 of companies act (Corporate Law)

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This query is : Resolved



( Author )
27 January 2012

R/Expert

I want to know that if a C.A has application money of a Pvt Company can he be appointed as auditor of that company.

Thank You


CS Mitesh Mehta

( Expert )
27 January 2012

As per Section 226(3)(e), A person holding any security of the Company, after a period of one year from 13-12-2000 can not appointed as Auditor


Jiten Gupta

( Expert )
27 January 2012


As per section 226(3) None of the following persons shall be qualified for appointment as auditor of a company—
(a) a body corporate;

(b) an officer or employee of the company;

(c) a person who is a partner, or who is in the employment, of an officer or employee of the company;

(d) a person who is indebted to the company for an amount exceeding one thousand rupees, or who has given any guarantee or provided any security in connection with the indebtedness of any third person to the company for an amount exceeding one thousand rupees;

5[(e) a person holding any security of that company after a period of one year from the date of commencement of the Companies (Amendment) Act, 2000.

Explanation.—For the purpose of this section, “security” means an instrument which carries voting rights.]

Explanation.—References in this sub-section to an officer or employee shall be construed as not including references to an auditor.


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