Section 140 requires the intimation of resignation of the Statutory Auditor.
Purpose: Section 140 of the Companies Act, 2013 mandates companies to inform the Registrar of Companies (RoC) about the resignation of the statutory auditor of the company. This is to ensure transparency and accountability in the management of the company's financial affairs.
Timeline: The company must inform the RoC about the resignation of the statutory auditor within 30 days of receiving the auditor's resignation letter.
Penalty: Failure to comply with Section 140 can result in penalties for the company and its officers. The company may face a penalty of up to INR 5 lakhs, and the concerned officer may face a penalty of up to INR 50,000. Additionally, the company may be barred from making certain filings, and the directors may face disqualification.
Form: The company must file Form ADT-3 with the RoC to intimate the resignation of the statutory auditor.
Reporting authority: The company must file Form ADT-3 with the Registrar of Companies (RoC) where the registered office of the company is situated.
Other: The company must also inform the auditor of their resignation and provide a copy of the intimation made to the RoC. The auditor has the right to provide a written statement to the RoC regarding the reasons for their resignation.
