Question

Hey dude ..question was nice..if an auditor is  A partner or employee of an officer or employee of the company.then he will be disqualified..since he is not the employee of the company he audited..he is eligibe to do audit...if so the auditor is in partnership business mean CA firm..if so the partnership firm is appointed as auditor to company since the partner of the partneship firm is employee the firm of CA will be disqalified from the audit..

Since it came into loght on 2010..again the papers will be audited by another auditor i guess..or company will be sued for breach of rule..i guess.

sasanka is right 

the said auditor can be liable sued against him

for professsinal misconduct.

an employee of any company can not do business elsewhere without knowledge of employer, in such case the legal complication of "competence with employer" would arise, 

chcek the from 12B or any such document submitted to company by that employee for that perticular period in surat and go for legal settlement.

yes, this is the case of professional misconduct because the auditor has not complied with the requriement of co. act,1956.

disciplinary  action will taken against the auditor on complaint made by the company.

i think the accounts of 2003 will be again audited by another auditor and the victim auditor should take the copies of audit report and a written representation will be given to registrar. (only my opinion)

 refer this link /forum/doubt-about-capital-structure-141405.asp