Appoint an Auditor explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
To appoint a statutory auditor at the AGM, obtain the auditor's consent and Section 141 certificate, pass an ordinary resolution appointing them for five years, and file e-Form ADT-1 with the Registrar within 15 days. The auditor holds office until the conclusion of the sixth AGM.
Overview
After the first auditor's term ends at the first AGM, the company appoints an auditor for a full five-year term at that same AGM. This appointment must be reported to the Registrar through e-Form ADT-1. It is one of the most routine — and most commonly delayed — post-AGM filings.
When It Is Required & Legal Basis
Section 139(1) of the Companies Act, 2013 requires every company to appoint an individual or firm as auditor at the first AGM to hold office from the conclusion of that meeting until the conclusion of its sixth AGM. Rule 4 of the Companies (Audit and Auditors) Rules, 2014 requires the company to inform the Registrar in ADT-1 within 15 days of the meeting. Annual ratification was removed by the 2017 amendment.
Step-by-Step Process
- Board recommendation. The Board (or Audit Committee, where applicable) recommends the auditor for appointment.
- Consent and certificate. Obtain the auditor's written consent and a Section 141 eligibility certificate.
- Pass resolution at AGM. Members pass an ordinary resolution appointing the auditor for five consecutive years.
- Intimate the auditor. Send the appointment intimation to the auditor.
- File ADT-1. File e-Form ADT-1 with the Registrar within 15 days of the AGM, attaching consent, certificate and resolution.
- Retain records. Keep the SRN and challan for the minute book and audit file.
Forms, Attachments & Fees
| Item | Purpose | Timeline / Fee |
|---|---|---|
| ADT-1 | Intimation of auditor appointment | Within 15 days of AGM |
| Auditor's consent | Willingness to act | Attachment |
| Section 141 certificate | Eligibility / non-disqualification | Attachment |
| Ordinary resolution | Appointment for five years | Attachment |
| Government fee | Based on authorised capital | Approx. ₹200–₹600 for most companies |
Timeline & Due Dates
The single hard deadline is 15 days from the AGM to file ADT-1. Since AGMs are usually held by 30 September, most companies file ADT-1 in early October. The appointment term itself runs five years, up to the sixth AGM.
Penalty for Delay / Non-compliance
Late filing of ADT-1 attracts additional fees under Section 403 on a slab basis, rising with the length of delay — up to 12 times the normal fee. Failure to file altogether can attract penalty on the company and officers in default under the audit provisions. File within 15 days to avoid these escalating additional fees.
Practical Tips
- Collect consent and the Section 141 certificate before the AGM so ADT-1 can be filed immediately after.
- Confirm the auditor is within the rotation and ceiling limits under Sections 139 and 141.
- Diarise the 15-day deadline the moment the AGM concludes — additional fees stack up quickly.
- File ADT-1 even for reappointment of the same auditor for a fresh term.