Removal of Auditors
Removal of auditor only requires an ordinary resolution.
However Section 225 prescribes certain procedure for the removal of an auditor.
(1) Special notice shall be required for a resolution
at an annual general meeting
appointing as auditor a person other than a retiring auditor,
or providing expressly that a retiring auditor shall not be re-appointed.
(2) On receipt of notice of such a resolution,
the company shall forthwith
send a copy thereof to the retiring auditor.
(3) Where notice is given of such a resolution and
the retiring auditor makes with respect thereto
representations in writing to the company
(not exceeding a reasonable length)
and requests their notification to members of the company,
the company shall,
unless the representations are received by it too late for it to do so,
(a) in any notice of the resolution given to members of the company, state the fact of the representations having been made; and
(b) send a copy of the representations to every member of the company to whom notice of the meeting is sent, whether before or after the receipt of the representations by the company;
If a copy of the representations is not sent as aforesaid
because they were received too late
or because of the company’s default the auditor may
(without prejudice to his right to be heard orally)
require that the representations shall be
read out at the meeting
The copies of the representations need not be sent out and the representations need not be read out at the meeting
on the application either of the company
or of any other person who claims to be aggrieved,
if the Central Government is satisfied that the rights conferred are being abused to secure needless publicity for defamatory matter;
and the Central Government may order
the company’s costs on such an application
to be paid in whole or in part by the auditor,
notwithstanding that he is not a party to the application.
Tags for this Thread