Casual Vacancy of the Auditor means a vacancy caused due to death, resignation, disqualification etc. of the auditor after accepting a valid appointment because of which the auditor cease to act as auditor of the company. 

IN CASE OF A COMPANY WHOSE ACCOUNTS ARE SUBJECT TO AUDIT BY AN AUDITOR APPOINTED BY THE COMPTROLLER AND AUDITOR GENERAL OF INDIA:

Any casual vacancy of the auditor in the office shall be filled by the Comptroller and Auditor General of India within thirty days.

IN CASE OF A COMPANY OTHER THAN COMPANIES WHOSE ACCOUNTS ARE SUBJECT TO AUDIT BY AN AUDITOR APPOINTED BY THE COMPTROLLER AND AUDITOR GENERAL OF INDIA:

1. Casual vacancy of the auditor due to Resignation:  If casual vacancy is arising due to the resignation of auditor, it shall be filled within 30 days by the Board of directors, and the appointment made by the Board shall be approved in a general meeting convened within 3 months from the date of recommendation of the Board and he shall hold the office till the conclusion of the next annual general meeting.

Steps required to fill Casual Vacancy of the Auditor due to Resignation are:

1. Obtain certificate in writing from the proposed auditor confirming his eligibility to be appointed.
2. Convene a Board meeting within 30 days of arising casual vacancy after giving notice to all directors and pass resolution appointing the new auditor in the place of old auditor.
3. Inform the auditor so appointed with a certified copy of resolution.
4. Issue notice to hold general meeting within 3 months from the date of recommendation of the Board to the members of the company.
5. Hold the general meeting and approve the appointment of auditor already made by the Board of directors.
6. Inform the Registrar in form ADT-1 with requisite filing fees and annexures.
7. In case of listed company, forward promptly to the stock exchange the notice and proceedings of the general meeting.

 
2. Casual Vacancy of the Auditor due to reasons other than Resignation: Where Casual vacancy is arising by other than resignation then vacancy shall be filled by the Board within 30 days.

Steps required to fill Casual Vacancy of the Auditor due to reasons other than Resignation are:

1. Obtain certificate in writing from the proposed auditor confirming his eligibility to be appointed.
2. Convene a Board meeting within 30 days of arising casual vacancy after giving notice to all directors and pass resolution appointing the new auditor in the place of old auditor.
3. Inform the auditor so appointed with a certified copy of resolution.
4. Inform the Registrar in form ADT-1 with requisite filing fee and annexures.

FORM ADT-3

Section 140 (2) read with rule 8 of the Companies (Audit and Auditors) Rules 2014, the auditor who has resigned from the company shall file a statement in the Form ADT-3 within a period of 30 days from the date of resignation with the company and the Registrar, and in case of Govt. company, the auditor shall also file such statement with the Comptroller and Auditor General of India, indicating the reasons and other facts as may be relevant with regard to his resignation.



If the Auditor fails to file Form ADT-3, he or it shall be punishable with fine which shall not be less than fifty thousand rupees but which may extend to five lakh rupees.


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