Auditor appointment

Explanation to Rule 3 of Companies (Audit and Auditors) Rules, 2014

Explanation.- For the purposes of this rule, it is hereby clarified that, if the appointment is not ratified by the members of the company, the Board of Directors shall appoint another individual or firm as its auditor or auditors after following the procedure laid down in this behalf under the Act.

Hence as a consequence of non ratification of auditors's apponintment by the AGM, office of auditors became vacant and it is to be treated a casual vacancy. Now Board should fill this casual vacancy u/s 139(8)