Clarification regarding ‘Body Corporate’ for the purpose of Section 226(3)(a) of the Companies Act, 1956
The MCA received representation from ICAI stating that under Section 226(30(a) of the Companies Act, 1956, a body corporate is disqualified from appointment as auditor of the company. Since LLP is a body corporate under section 3(1) of the LLP Act, 2008, LLP among other chartered accountants will not be qualified for appointment as auditor under Section 226(3) of the Companies Act, 1956. The MCA vide its circular No. 30A/2011 dated 26th May, 2011 has clarified that LLP of Chartered Accountants will not be treated as a body corporate for the limited purpose of Section 226(3) of the Companies Act, 1956.