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Shweta asked 1 year ago

As per company Act, an auditor has to right to lien on books and documents at his possession on non payment of fees. But auditor can not retain books of client as it will be treated as other misconduct. Please clarify sir

2 Answers
Megha agarwalMegha agarwal answered 1 year ago

Auditor is guilty of other misconduct when he retains the books of accounts of his client without any sufficient cause…. 
non-payment of fees is a sufficient a cause… hence auditor should not be guilty of professional misconduct in this case.. 

RaviRavi Staff answered 1 year ago

1st of all Co act doesn’t give right to lien, it gives right to access.
Following points support lien
General Principle of Law / ICAEW Clarification 
Following disapprove lien
Sec 128 (Not practical to implement if lien exercised) / Supreme Court Judgment / ESB Decision
Lien not allowed it would lead to other misconduct    

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