Resignation of auditor

Originally posted by : MOHIT SALUJA
	Please advice in following two situations: 1. AN AGM held on 30.09.2011 in a Private Limited Company and the Auditor A was appointed in the AGM but doe to some pre- occupations he resigns on 30.11.2011, what is the procedure to follow now for Auditor Appointment. Will it require Special or Ordinary resolution in EGM 2. Mr. A, Auditor Audit the accounts on 30.08.2011 and resign on the same day. and Notice for AGM is yet to send to the shareholders in a Private Limited Company, What is the procedure to follow for new Auditor Appointment.

Dear Mohit ji,

Situation 1
 

In this case you have to call an EGM and pass an Ordinary Resolution. The procedure of section 225 is to be followed i.e. Special Notice is to be served. In this case the appointment of new auditors is subject to the approval of Cental Government (powers delated to Regional Director)

Situation 2

It would be a general business and comes at the forth point of Notice and ofcourse Ordinary Resolutio would be passed.  Even in this case the procedure of section 225 is to be followed and special notice is to be send.

1.  Hold EGM to fill the casual vacancy arising by resignation of the Auditor. No special Notice u/s 225 is necessary in this case. The appointment shall be made by passing an ordinary resolution.

2. In second case, since you are going to appoint at AGM another auditor in place of retiring auditor, you have to comply with provisions of section 225 regarding special notice. At AGM, you have to pass Ordinary/Special resolution (if section 224A is attracted) as the case may be. 

No special Notice u/s 225 is necessary to fill the casual vacancy arising by resignation of the Auditor.