Definition of a relative for appointment as Statutory Auditor of a company, Corporate Laws / SEBI / LLP

[Deepak Bubna]

For the purpose of appointment as statutory auditor of a company, will Mother's brothers and sisters or Father's brothers and sisters will be considered as relative restricting such Chartered Accountant to accept appointment in a company if such person from Mother or Father's side have controlling stake in the company, either as shareholders or directors or both ?

Posts / Replies

[Padmanathan Kollengode]

Section 2(77) of Companies Act, 2013 read with Rule 4 of Companies (Specification of definitions details) Rules, 2014 - A person shall be deemed to be the relative of another, if he or she is related to another in the following manner, namely:-

(1) Father:

Provided that the term “Father” includes step-father.

(2) Mother:

Provided that the term “Mother” includes the step-mother.

(3) Son:

Provided that the term “Son” includes the step-son.

(4) Son’s wife.

(5) Daughter.

(6) Daughter’s husband.

(7) Brother:

Provided that the term “Brother” includes the step-brother;

(8) Sister:

Provided that the term “Sister” includes the step-sister.

Therefore mother's brother and sister or father's brother and sisters will not be considered as "relative" for appointment as statutory auditor purpose.