2018 (2) TMI 1618

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....CA/11/2016 (Company Petition No.64 of 2006 in Company Law Board) has filed this appeal against order dated 20th July, 2017 passed by the National Company Law Tribunal, Division Bench, Chennai (hereinafter referred to as 'NCLT'), which order reads as under : "Counsel for Applicant/R2 present. Counsel for R4, R8, R10 and R19 present. R11 and R18 reported expired. No representation on behalf of the other Respondents in the CA/115/2017. As directed by this Bench, Mr. R. Aghoramurthy (Chartered Accountant), auditor concerned in this matter, appeared in person. He submitted that whatever report he has prepared is in line with the direction of the Hon'ble High Court of Madras. He stated that other than the interim report, he has no ot....

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....bruary, 2009 had initially directed investigative audit. The relevant important paragraph in that regard is 12(ii), which reads as under :- "(ii) Shri R. Aghoramurthy, Chartered Accountant, Chennai (Mobile No. 9444322347) is authorized to carry out an investigative audit of the accounts of the Company for the period from 01.04.2000 to 31.03.2005 by scrutinizing the books of account, vouchers and other connected records of the Company and on hearing submissions of all the connected parties. The Chartered Accountant will submit a report of the financial transactions of the Company for the relevant period, which shall include all the receipts, payments, expenses incurred on behalf of the Company together with the fund utilization ther....

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....er of interim stay of the order dated 25.2.2009 passed by the Company Law Board till 22.6.2009. It is further made clear that while preparing the report, the Chartered Accountant shall not call for the views or response from any of the parties on this matter." 4. Subsequently, it appears that Chartered Accountant submitted Interim Investigative Audit Report in a sealed cover to the High Court in the Company Appeal No. 6 of 2009. The High Court first analysed the appeal on its merits and then proceeded to open the report and made certain observations in paragraph 120 of the judgement and proceeded to find that the Interim Investigative Audit Report also does not favour the Appellant (present Respondent No. 2) in many aspects. 5. Copy o....

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.... into the merits of the report and without setting the same aside, the present impugned order calling for names of the new Chartered Accountants could not have been passed. We are told that subsequently new Chartered Accountant have even been appointed by order dated 23rd August, 2017. 8. In our view, it was necessary for NCLT to consider the report which was available and which was treated by the Auditor as its final report for whatever it was worth and record finding whether or not the said report could be maintained. Without rejecting the said report, giving directions for further Chartered Accountants to be suggested and appointment was not proper. When the present report has not been set aside, taking fresh report if the same happen....