law: Companies Act, 2013 
  Chapter
  
  X
  Audit
  
  and Auditors
  139.
  
    Appointment
  
  of auditors.
  1.      Subject to the
  
  provisions of this Chapter, every company shall, at the first annual general
  
  meeting, appoint an individual or a firm as an auditor who shall hold office
  
  from the conclusion of that meeting till the conclusion of its sixth annual
  
  general meeting and thereafter till the conclusion of every sixth meeting and
  
  the manner and procedure of selection of auditors by the members of the company
  
  at such meeting shall be such as may be prescribed:
  Provided
  
  that the company shall place the matter relating to such appointment for
  
  ratification by members at every annual general meeting:
  Provided
  
  further that before such appointment is made, the written consent of the
  
  auditor to such appointment, and a certificate from him or it that the
  
  appointment, if made, shall be in accordance with the conditions as may be
  
  prescribed, shall be obtained from the auditor:
  Provided
  
  also that the certificate shall also indicate whether the auditor satisfies the
  
  criteria provided in section 141:
  Provided
  
  also that the company shall inform the auditor concerned of his or its
  
  appointment, and also file a notice of such appointment with the Registrar
  
  within fifteen days of the meeting in which the auditor is appointed.
  Explanation. —For the purposes of
  
  this Chapter, “appointment” includes reappointment.
  2.      No listed company or
  
  a company belonging to such class or classes of companies as may be prescribed,
  
  shall appoint or re-appoint—
  a.     
  
    an
  
  individual as auditor for more than one term of five consecutive years; and
  b.    
  
    an
  
  audit firm as auditor for more than two terms of five consecutive years:
  Provided
  
  that—
               
  
   i.        
  
    an
  
  individual auditor who has completed his term under clause (a ) shall not
  
  be eligible for re-appointment as auditor in the same company for five years
  
  from the completion of his term;
              
  
   ii.        
  
    an
  
  audit firm which has completed its term under clause (b ), shall not be
  
  eligible for re-appointment as auditor in the same company for five years from
  
  the completion of such term:
  Provided
  
  further that as on the date of appointment no audit firm having a common
  
  partner or partners to the other audit firm, whose tenure has expired in a
  
  company immediately preceding the financial year, shall be appointed as auditor
  
  of the same company for a period of five years:
  Provided
  
  also that every company, existing on or before the commencement of this Act
  
  which is required to comply with provisions of this sub-section, shall comply
  
  with the requirements of this sub-section within three years from the date of
  
  commencement of this Act:
  Provided
  
  also that, nothing contained in this sub-section shall prejudice the right of
  
  the company to remove an auditor or the right of the auditor to resign from
  
  such office of the company.
  1.     
  2.     
  3.      Subject to the
  
  provisions of this Act, members of a company may resolve to provide that—
  a.     
  
    in
  
  the audit firm appointed by it, the auditing partner and his team shall be
  
  rotated at such intervals as may be resolved by members; or
  b.    
  
    the
  
  audit shall be conducted by more than one auditor.
  4.      The Central
  
  Government may, by rules, prescribe the manner in which the companies shall
  
  rotate their auditors in pursuance of sub-section (2 ).
  Explanation .—For the purposes of
  
  this Chapter, the word “firm” shall include a limited liability partnership
  
  incorporated under the Limited Liability Partnership Act, 2008.
  1.     
  2.     
  3.     
  4.     
  5.      Notwithstanding
  
  anything contained in sub-section (1 ), 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, in respect of a financial year,
  
  appoint an auditor duly qualified to be appointed as an auditor of companies
  
  under this Act, within a period of one hundred and eighty days from the
  
  commencement of the financial year, who shall hold office till the conclusion
  
  of the annual general meeting.
  6.      Notwithstanding
  
  anything contained in sub-section (1 ), the first auditor of a company,
  
  other than a Government company, shall be appointed by the Board of Directors
  
  within thirty days from the date of registration of the company and in the case
  
  of failure of the Board to appoint such auditor, it shall inform the members of
  
  the company, who shall within ninety days at an extraordinary general meeting
  
  appoint such auditor and such auditor shall hold office till the conclusion of
  
  the first annual general meeting.
  7.      Notwithstanding
  
  anything contained in sub-section (1 ) or sub-section (5 ), 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 first auditor shall be appointed by the Comptroller and
  
  Auditor-General of India within sixty days from the date of registration of the
  
  company and in case the Comptroller and Auditor-General of India does not
  
  appoint such auditor within the said period, the Board of Directors of the
  
  company shall appoint such auditor within the next thirty days; and in the case
  
  of failure of the Board to appoint such auditor within the next thirty days, it
  
  shall inform the members of the company who shall appoint such auditor within
  
  the sixty days at an extraordinary general meeting, who shall hold office till
  
  the conclusion of the first annual general meeting.
  8.      Any casual vacancy in
  
  the office of an auditor shall—
               
  
   i.        
  
    in
  
  the case of a company other than a company whose accounts are subject to audit
  
  by an auditor appointed by the Comptroller and Auditor-General of India, be
  
  filled by the Board of Directors within thirty days, but if such casual vacancy
  
  is as a result of the resignation of an auditor, such appointment shall also be
  
  approved by the company at a general meeting convened within three months of
  
  the recommendation of the Board and he shall hold the office till the
  
  conclusion of the next annual general meeting;
              
  
   ii.        
  
    in
  
  the case of a company whose accounts are subject to audit by an auditor
  
  appointed by the Comptroller and Auditor-General of India, be filled by the
  
  Comptroller and Auditor-General of India within thirty days:
  Provided
  
  that in case the Comptroller and Auditor-General of India does not fill the
  
  vacancy within the said period, the Board of Directors shall fill the vacancy
  
  within next thirty days.
  1.     
  2.     
  3.     
  4.     
  5.     
  6.     
  7.     
  8.     
  9.      Subject to the
  
  provisions of sub-section (1 ) and the rules made there under, a retiring
  
  auditor may be re-appointed at an annual general meeting, if—
  a.     
  
    he
  
  is not disqualified for re-appointment;
  b.    
  
    he
  
  has not given the company a notice in writing of his unwillingness to be
  
  re-appointed; and
  c.     
  
    a
  
  special resolution has not been passed at that meeting appointing some other
  
  auditor or providing expressly that he shall not be re-appointed.
  1.  
  2.  
  3.  
  4.  
  5.  
  6.  
  7.  
  8.  
  9.  
  10.   Where at any annual
  
  general meeting, no auditor is appointed or re-appointed, the existing auditor
  
  shall continue to be the auditor of the company.
  11.   Where a company is
  
  required to constitute an Audit Committee under section 177, all appointments,
  
  including the filling of a casual vacancy of an auditor under this section
  
  shall be made after taking into account the recommendations of such committee.