| Section 139 (5) & (7) of the Companies Act 2013 provide for power of the Comptroller and Auditor-General of India to appoint an auditor in a Government company or any other company owned or controlled, directly or indirectly, by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments. |
| While section 143 (5) of the aforesaid Act which provides for power of the Comptroller and Auditor-General of India to conduct supplementary audit does not specifically cover companies ‘owned or controlled, directly or indirectly, by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments’. |
| Therefore, difficulties have arisen in implementation of the provisions of section 143(5) for companies referred to in section 139 (5) & (7) of the said Act. |
| Further, in order to remove difficulties in implementation of section 143(5), MCA vide Companies (Removal of Difficulties) Seventh Order, 2014 dated 4th September 2014 has amended the said sub-section i.e. for the portion beginning with the words “In the case of a Government company” and ending with the words “required to be audited and”, the following shall be substituted, namely: – |
| “In the case of a Government company or any other company owned or controlled, directly or indirectly, by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments, the Comptroller and Auditor-General of India shall appoint the auditor under sub-section (5) or sub-section (7) of section 139 and direct such auditor the manner in which the accounts of the company are required to be audited and”. |
| Existing text of section 143(5) is reproduced below:- |
| “In the case of a Government company, the Comptroller and Auditor-General of India shall appoint the auditor under sub-section (5) or sub-section (7) of section 139 and direct such auditor the manner in which the accounts of the Government company are required to be audited and thereupon the auditor so appointed shall submit a copy of the audit report to the Comptroller and Auditor-General of India which, among other things, include the directions, if any, issued by the Comptroller and Auditor-General of India, the action taken thereon and its impact on the accounts and financial statement of the company. |
