NCLT bars auditor for issuing ‘false’ certificate
Mumbai NCLT has barred an auditor for 5 year from auditing companies after it was found that he colluded with the chairman of a company and gave a false audit certificate without even examining and verifying the books of accounts.
The NCLT passed the order in connection with a case by the Western Regional Director of the Ministry of Corporate Affairs against the auditor Mukesh Choksi, and the company he audited, Zen Shaving.
When the company’s auditor, Mukesh Choksi, was questioned, he claimed to have no knowledge about the company’s affairs and said he had signed off on its books without seeing them.
To a string of basic questions asked about the company, such as the last time Zen Shaving held an AGM, Choksi replied: “I don’t know”.
In its order, the NCLT also directed that the copy of the order be sent to National Financial Reporting Authority (NFRA) and ICAI “to take proper action as they may deem fit”.
NCLT bars CA for issuing ‘false’ certificate
The Extract of Order is given below for reference :
Since Mr Mukesh Maneklal Choksi, Statutory Auditor of Respondent No. 2 Company, colluded with the Chairman/Director of R-2 company has given a false Audit certificate relating to the Profit & Loss Account and Balance Sheet of the R-2 company, without even examining and verifying the books of accounts. The Statutory Auditor has not given any plausible explanation for such irresponsible fraudulent behaviour.
Therefore under 2nd Proviso to Section 140(5) of the Companies Act, 2013, R1, Mr Mukesh Maneklal Choksi shall not be eligible to be appointed as an Auditor of any company for a period of 5 years from the date of passing this order, and the auditor shall also be liable for action under Section 447 of the Companies Act, 2013.
Further by exercising powers under section 147(3)(i) of the Companies Act 2013, we also direct the Statutory Auditor Mr Mukesh M. Choksi to refund the remuneration received by him, during the period he acted as Auditor, back to the Company.