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TMI Blog2011 (2) TMI 1272X X X X Extracts X X X X X X X X Extracts X X X X ..... ng that the letter dated 30-10-2009, sent by the auditors is in consonance with the direction issued by the Division Bench in the order dated 17-4-2009, in O.S.A. No. 71 of 2009. 2. Respondent Nos. 1 to 3 are the shareholders in the first appellant-company. Alleging that the affairs of the company are not properly managed and that the shareholders are kept in the dark, respondent Nos. 1 to 3 have filed company petition in C.P. No. 198 of 2007 under section 237( a )( ii ) of Companies Act, 1956 read with rule 11(9) of Companies (Court) Rules, 1959. In the petition, respondent Nos. 1 to 3 prayed for a declaration that the affairs of the first appellant-company ought to have been investigated by the inspector or inspectors appointed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... balance-sheet and any other report, which may require for the court to dispose of the company petition finally. The question of verification of the correctness of the accounts does not arise at this stage, as it is for the court to finally consider the same at the time when the company petition is disposed of." 5. Before the same Division Bench, the first appellant-company had filed M.P. No. 3 of 2009 for clarification on the ground that in the guise of the directions contained in paragraph (7), the chartered accountant might go into the verification of the correctness of the balance-sheet. By the order dated 7-8-2009, the Division Bench has dismissed M.P. No. 3 of 2009 stating that the apprehension of the first appellant is on total m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as stated that due to bulkiness of the records required by the auditors, the first appellant requires three weeks' time to produce the same. Thereafter, challenging the order of learned single judge dated 7-4-2010, in C.A. No. 744 of 2010, the appellants have come forward with this appeal. 8. Mr. R. Veeraraghavan, learned counsel for the appellants contended that the intention in the letter of the auditors dated 30-10-2009, was to verify the correctness of the accounts of the first appellant-company which the Division Bench has clearly held that auditors were not entitled to do so. It was further submitted that because the statutory auditors have already audited the accounts of the first appellant and while so, in violation of the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account and ledger. While looking into the books of account and vouchers, the auditors need necessarily to look into the corresponding documents. While he is making the report to the court, the auditor is not merely confined to the mechanics of checking the vouchers and making a report merely with computation of figures. It is a vital task to take care to see that the auditor does not commit an error in submitting the report to the court. To prepare a comprehensive report relating to the entries in the balance-sheets, it is necessary that the auditors need to look into the supporting entries, break up figurers, etc. Checklist of items are required only to look into the accounts and to give a comprehensive report to dispose of the company pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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