IL&FS matter: NCLAT dismisses auditors pleas
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New Delhi: The NCLAT on Wednesday dismissed the pleas of auditors of debt-ridden IL&FS -- Deloitte Haskins & Sells and KPMG arm BSR & Associates -- along with independent directors challenging their impleadment in the case of alleged fraud at a group firm IFIN.

A two-member bench of the NCLAT upheld the directions of the Mumbai bench of the National Company Law Tribunal, saying it can not be termed as "illegal". The NCLT had directed them to implead the auditors and independent directors as party.

The NCLT is empowered to pass order to implead them under Section 242 of the Companies Act, 2013 in a petition under Section 241(2) if "it forms opinion that the affairs of the company have been conducted in a manner prejudicial to the public interest", the appellate tribunal further said.

"Once such opinion is formed by the Tribunal, it may pass any order as it deem fit and proper,"said the National Company Law Appellate Tribunal (NCLAT) bench. the case relates to IFIN, a subsidiary of IL&FS.

Rejecting the contention of the auditors and others that they cannot be treated as part of the management, which is responsible for managing the affairs of the company and therefore should not be charged as per the said section, NCLAT said.

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Free Press Journal