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The Companies which fall within the purview of Rule 5 of Companies (Audit & Auditors) Rules, 2014 and Section 139(2) of Companies Act 2013 have been given a time transition of 3 years to comply with the provisions of rotation of auditors. Meaning that they need to appoint a new auditor in case the existing auditor has already exceeded the term permitted in the said Section. My query is: What about companies to whom the section is not applicable on 1.4.14 but by virtue of fresh borrowings beyond the limit given in Rule 5, the section becomes applicable to them? Do they also get a time transition of 3 years? Or do they need to make fresh appointment in this year itself.

Section 139- Appointment of auditors.

Posted By: Stuti 10 year(s) ago

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Expert Ankit Singhi

for such companies no transition period is applicable. The said period is only applicable for companies existing on the commencement of such provision

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Ankit Singhi

the transition period will be applicable. excuse me earlier reply

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Pramod Prabhudesai
B D Jokhakar & Co

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