XYZ & Co., a proprietary firm of Amit, a Chartered Accountant in practice, has been appointed as an Independent auditor of ABC Ltd. Subsequently, it came to the light that Smita, sister of Amit is Chief Financial Off

According to section 141 (3) (f) of the Companies Act, 2013, if any relative of the auditor is a director or is in the employment of the company, as a director or as a key-managerial-personnel then such Auditor shall not be eligible to be appointed or continue as the auditor of the Company. Smita, the CFO of the Company is the relative of Amit who is the Proprietor of the Auditor Firm XYZ & Co., hence such Auditor cannot continue as an Independent Auditors of the Company and therefore shall vacate their office as such in terms of Sec 141 (4) of the Companies Act, 2013 and such vacancy shall be deemed to be a casual vacancy in the office of Auditor.