The High Court of Andhra Pradesh has allowed the company application filed under Section 462 of the Companies Act, 1956, read with Rule 298 and Rule 306 of the Companies (Court) Rules, 1959, due to the absence of adverse comments in the audit report.
The case involved a request from the Official Liquidator to take the half-yearly accounts of the subject company for the period from 01.04.2022 to 30.09.2022, along with the auditor report dated 06.12.2023, which was submitted on 08.12.2023, by M/s Padmanabha Rao and Company, Chartered Accountants. The Official Liquidator also sought permission to make the payment of the audit fee of Rs.500 plus GST.
The Official Liquidator, Mr. Uttam Kumar Sahoo, filed the application, supported by an affidavit dated 18.06.2024. The liquidator requested the court to take on record the half-yearly accounts of M/s Spectra Agrochem Ltd (in liquidation) for the specified period and to allow the payment of the audit fee from the available funds of the company or the Estate and Establishment Fund Account if no funds were available in the company’s account.
T.V.P. Sai Vihari, representing the Official Liquidator, contended that the half-yearly accounts for the period from 01.04.2022, to 30.09.2022, had been duly audited by M/s Padmanabha Rao and Company, pursuant to the order of the court dated 27.06.2023, passed in C.A. No. 7 of 2023. The auditor’s report, submitted on 08.12.2023, contained no adverse comments or observations on the statement of accounts of the company in liquidation.
The bench of Justice B.S. Bhanumathi found merit in the application and observed that the half-yearly accounts and the auditor’s report were in compliance with the provisions of Section 462 of the Companies Act, 1956, and the relevant rules under the Companies (Court) Rules, 1959. The court noted that there were no adverse comments in the auditor’s report, justifying the acceptance of the half-yearly accounts and the permission to pay the audit fee.
The High Court allowed the company application as prayed for by the Official Liquidator. The court’s order included permission to meet the cost of the application and any miscellaneous expenses from the available funds of the company or the Estate and Establishment Fund Account if no funds were available in the company’s account. The court also directed that no costs would be imposed.
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