Section 139(2) of the companies act, 2013

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Aditya (Querist)
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03 November 2014 Dear Sir,

My Question is When I file form ADT-1 for Appointment of Auditors and in form Whether company is falling under any class of companies as per section 139(2). My question is if the company is private company whether it is following under 139(2) of the company Act, 1956

Nikhil Kaushik

Nikhil Kaushik (Expert)
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03 November 2014 please refer Rule 5 of Companies (Audit and Auditors) Rules, 2014.

the private companies falling under following categories shall be included in 139(2):

(a) all unlisted public companies having paid up share capital of rupees ten crore or more;

(b) all private limited companies having paid up share capital of rupees twenty crore or more;

(c) all companies having paid up share capital of below threshold limit mentioned in (a) and (b) above, but having
public borrowings from financial institutions, banks or public deposits of rupees fifty crores or more.

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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03 November 2014 you may refer https://www.mca.gov.in/Ministry/pdf/NCARules_Chapter10.pdf

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Aditya

Aditya (Querist)
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04 November 2014 Thanks Nikhil,

In case of Rotation of Individual Auditors, if the Individual Auditors can complete their tenure of continuous 5 years in the same company without break. whether he shall be eligible for appointment in the same company after the completion of the expiry of the term of 5 consecutive years.

When I read rules 6 of Companies (Audit & Auditors Rules 2014) I see the table and I see he may appointed for anthor 3 year.

Please give me advice whether he is appointer for the auditors in the same company for the 3 years after the completion of the tenure of 5 years.

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Ashok Reddy Chapa

Ashok Reddy Chapa (Expert)
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26 March 2016 Mr Aditya,

An individual auditor cannot act as auditor for more than 5 consecutive years.After completion of his tenure company have to appoint one more auditor in his place. And first auditor eligible only after 5 years completion of his tenure as auditor in that company.

Ex: Mr Bindhesh is an auditor of X pvt ltd from Apr'14.
Ans: So as per above provisions bindhesh can be act as auditor till March 2019. After 2019 company should change the auditor(He must not be bindhesh). And Bindesh will be eligible as auditor in the same company after 5 years of completion of his tenure ( From Apr'2024).

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