Sir, In one of the SubRule to Rule 6 it is given that ” where a partner who is in charge of the audit firm, also certifies the FS, retires from the said firm and joins ANOTHER FIRM OF CA’s, such other firm would also be ineligible to be appointed for a period of 5 Years.
Now, My doubt is take for an example a Firm consisting of 2 partners (Father and Son Both are CA’s), as per the normal provisions this firm would be appointed as an auditor for 2terms of 5 consecutive years ie 10 years. Now in the 10th Year, the Son retires from the firm (and the son was only the in charge of the firm and he certifies the FS) and opens a new CA office in his individual name, so, in this case, would he be eligible to be appointed for 5 years or not (Because in this case he has NOT JOINED ANOTHER FIRM OF CA’s). If he is eligible can this method be used by CA firms which are predominantly family managed CA firms so that they can avoid the fear of not losing company audits to other CA’s/ Firms?
we need to take reasonable interpretation , more than just literal interpretation. law says “Joins Another Firm” it does not specify existing or new. so its better to interpret that joining existing firm or joining / establishing new firm both will be covered.
further here, firm should be interpreted as practising unit whether proper partnership firm or proprietorship or individual practicing unit.
i think intent of law is important and interpretation should be accordingly
so i think son’s firm even if new or even if proprietorship it will be ineligible, ca community needs to accept this change, huge changes have happened in big 4s and many firms becasue of rotation