In India, business legislation mandates that a corporate auditor examines the organization's financial reports. The auditor's primary responsibility is to identify any irregularities and propose appropriate solutions.
Furthermore, the auditor has other duties, such as monitoring the performance of management, offering guidance on accounting principles and practices, and fulfilling any additional tasks required by the board of directors or management.
As per the Companies Act 2013, when a company appoints an auditor, it must inform the Registrar of Companies (ROC) about the appointment through a specific procedure using Form ADT-1.
Today we will explore the various aspects related to Form ADT-1 filing, including filing fees, the process of submitting Form ADT-1 to the Ministry of Corporate Affairs (MCA), the due date for filing ADT-1, and the necessary documents for filing ADT-1.
What is Form ADT-1?
Following the conclusion of the annual general meeting (AGM), all companies utilize Form ADT-1 to notify the registrar of companies regarding the appointment of an auditor. This requirement is mandated by Section 139(1) of the Companies Act 2013, and the form needs to be filed each year post the AGM in which the auditor was appointed.
When to File Form ADT-1 to MCA?
You are required to submit Form ADT-1 to the Registrar of Companies within 15 days from the date of the Annual General Meeting in which the auditor was appointed or reappointed. For instance, if a company's AGM took place on March 30, 2023, the company must submit Form ADT-1 on the MCA portal by April 14, 2023.
Kindly note form ADT-1 should be submitted within 15 days of the initial board meeting for newly incorporated companies. The first board meeting is typically conducted within 30 days of incorporation, during which the board of directors appoints the company's auditor.
Documents Attached with Form ADT 1
Here is a list of documents that must be attached to Form ADT-1:
1. Copy of the company's board resolution or the resolution passed during the annual general meeting.
2. Written consent from the appointed auditor confirming their acceptance of the appointment.
3. A certificate from the auditor stating that they are not disqualified or ineligible to serve as an auditor under Section 141.
4. Copy of the intimation provided by the company to the auditor regarding their appointment.
Filing Fee of Form ADT-1
The following are the applicable filing fees for submitting Form ADT-1 to the Registrar of Companies:
Nominal Share Capital of the Company
Fee in (INR)
< INR 1,00,000
Between 1,00,000 and 4,99,999
Between 5,00,000 and 24,99,999
Between 25,00,000 and 99,99,999
> or equal to 1,00,00,00
Other Annual Compliance for Private Limited Company
Here are some important annual compliance requirements for Private Limited Companies in India:
1. Annual General Meeting (AGM): Every private limited company must conduct an AGM each year, within six months from the end of its financial year. The AGM serves the purpose of presenting the company's financial statements, appointing or re-appointing directors, and declaring dividends.
2. Financial Statements: Every private limited company is required to prepare comprehensive financial statements, including a balance sheet, profit and loss account, cash flow statement, and notes to accounts. A qualified chartered accountant is responsible for conducting the audit of these financial statements.
3. Income Tax Returns (ITR): Filing income tax returns is compulsory for every private limited company. The company must submit its ITR on or before the due date, which is typically July 31st of each year. It is important to note that all companies, regardless of their profitability, are required to file ITR.
4. Annual Return Filing: Private limited companies must file their annual return with the Registrar of Companies (ROC) within 60 days from the date of the AGM. The annual return provides crucial information about the company's shareholding pattern, directors, and other statutory details.
These annual compliance requirements are essential for private limited companies to fulfill their legal obligations and maintain transparency in their operations.
Process to File Form ADT-1 with MCA
Here is a simplified explanation of the steps involved in filing Form ADT-1:
1. Obtain a Digital Signature Certificate (DSC): This is a digital signature that ensures the authenticity and integrity of electronic documents.
2. Obtain Director Identification Number (DIN): If you don't already have a DIN, you need to apply for one. DIN is basically a unique identification number that is assigned to directors.
3. Download Form ADT-1: Visit the official website of the Ministry of Corporate Affairs (MCA) and download Form ADT-1.
4. Fill in the Required Details: Complete the form by providing the company's name, registered office address, and other necessary information.
5. Provide Auditor Details: Enter the information of the appointed or reappointed auditor, including their name, address, PAN (Permanent Account Number), and membership number.
6. Attach Supporting Documents: Include essential documents such as the board resolution that approves the auditor's appointment and the auditor's consent letter.
7. Verify the Form: Use the digital signature certificate of the director who signed the form to verify its authenticity.
8. Submit the Form Electronically: Once the form is verified, submit it electronically to the Registrar of Companies (ROC).
9. Pay the Filing Fee: The fee for Form ADT-1 needs to be paid online after submission.
10. Acknowledgment of Submission: After successful submission and payment, an acknowledgment will be sent to the registered email address provided in the form.
Amount of Penalty Imposed on Delayed Filing of Form ADT-1
Failure to meet the due date and file Form ADT-1 on time may result in the imposition of the following penalties:
Delay in Filing (in no. of days)
Up to 30 days
Twice the Normal Fees
Duration between 30 days and 60 days
4 x Normal Fees
Duration between 60 days and 90 days
6 x Normal Fees
Duration between 90 days and 180 days
10 x Normal Fees
More than 180 days
12 x Normal Fees
Other Important Points for ADT-1 Form
When completing Form ADT-1 MCA, there are additional considerations to keep in mind:
1. Applicability: Form ADT-1 must be filed by all types of companies, including Private, Listed, Unlisted, Public, One Person, and Other Companies.
2. Filing Responsibility: It is the company's responsibility to file Form ADT-1; the auditor is not required to file the paperwork.
3. Temporary Appointment: Even if the auditor is appointed temporarily, Form ADT-1 must still be submitted.
4. First Auditor Appointment: If necessary, Form ADT-1 can also be filed for the appointment of the company's first auditor.
5. Electronic Filing: Form ADT-1 can be filed electronically through the Ministry of Corporate Affairs website.
6. Automatic Approval: Submitting the form electronically will result in automatic approval of the electronic form.
7. Acknowledgment: Upon successful registration, the authorities will send an acknowledgment to the company's registered email address.
8. Replacement of Form 23B: The previous requirement of filing Form 23B by the auditor upon receiving the appointment letter from a company has been replaced by Form ADT-1. Previously, Form 23B had to be submitted at least 30 days after receiving the appointment letter. However, with the introduction of the New Companies Act 2013, this approach was abandoned.
9. SRN Number Reference: The SRN (Service Request Number) from the ADT-1 form must be mentioned when filing AOC-4 by the organization.
These additional considerations are important to ensure compliance when completing Form ADT-1 for filing with the Ministry of Corporate Affairs.
E-filing of Form ADT-1
The following steps outline the process of completing Form ADT-1 MCA online:
1. Electronic Filing: Form ADT-1 can be filed electronically. You can download the form from the Ministry of Corporate Affairs (MCA) website.
2. Automatic Approval: The approval of the e-form is automated, which means you will receive an immediate confirmation once the relevant authority has processed and registered the form.
3. Acknowledgement Email: Upon successful registration of the e-form, an acknowledgment email will be sent to the email ID provided in the form. This email serves as confirmation that the form has been successfully submitted.
Laws Regarding the Form ADT-1 MCA
Section 139 Companies Act of 2013
As per Section 139(1) of the Act, the initial auditor for a non-government company should be appointed by the Board of Directors (BOD) within 30 days from the date of the company's registration.
However, if the Board fails to appoint an auditor, they must inform the company's members. The members will then have a period of 90 days to appoint an auditor through an Extraordinary General Meeting (GM). The appointed auditor will hold the position until the completion of the first annual report.
In simpler terms, the board of directors must appoint the first auditor within 30 days of the company's incorporation, and no formal filing or notification is required for this appointment. The auditor can be appointed for a term of 5 years at the end of the first annual general meeting.
Companies (Audit and Auditors) Rules of 2014 - Rule 3
The section provides insight into the auditor selection process, which offers the following options:
1. Evaluation by the Board of Directors (BOD): In cases where a company is required to establish an audit committee under Section 177, or even if it is not mandatory, the BOD of the company will assess the auditor's qualifications to ensure they meet the necessary criteria.
2. Request for Information: The audit committee or the Board has the authority to seek any relevant information from the auditors. This step allows for a comprehensive evaluation before making a final decision.
3. Board Recommendation: Based on the recommendation of the Audit Committee, the board will assess and suggest the names of auditors to be appointed. These recommendations will then be presented to the members at the Annual General Meeting (AGM) for their consideration and appointment.