Decorous Investment & Trading Co Ltd. has recently uncovered a compliance oversight regarding the mandatory rotation of statutory auditors, as required by Section 139(2) of the Companies Act, 2013. The company has taken swift action to rectify this issue and ensure adherence to regulatory requirements.

Key Developments

1. Compliance Lapse Discovery: The company discovered that M/s G.K. KEDIA & CO., their previous statutory auditors, had completed the maximum permissible tenure of ten consecutive years.

2. Nullification of Previous Appointment: The re-appointment of M/s G.K. KEDIA & CO., approved at the Annual General Meeting (AGM) held on September 29, 2025, has been deemed null and void ab initio.

3. New Auditor Appointment: The board has recommended the appointment of M/s S M G A & Co., Chartered Accountants (Firm Registration No. 014671C), as the new statutory auditors.

4. Shareholder Approval Pending: The appointment of the new auditors is subject to shareholder approval at an upcoming Extra-Ordinary General Meeting (EoGM).

EoGM Details

Corrective Actions Taken

1. The company has initiated the process to suppress the earlier auditor appointment resolution passed at the 42nd AGM.

2. The Audit Committee reviewed the situation and recommended corrective action to the Board of Directors.

3. The Board formally reviewed and cancelled the earlier resolution, approving the proposal to appoint a new auditor.

4. M/s S M G A & Co. have provided written consent confirming their eligibility under Section 139(1) of the Companies Act, 2013.

The proposed appointment of M/s S M G A & Co. is for a term until the conclusion of the Annual General Meeting for the Financial Year 2025-26. Shareholders are advised to refer to the EoGM notice for further details and to participate in the e-voting process to approve the new auditor appointment.

This incident underscores the importance of rigorous compliance checks and the need for companies to stay vigilant about regulatory requirements, particularly those related to corporate governance and financial reporting.

Decorous Investment & Trading Co Ltd. (CIN: L67120DL1982PLC289090) has announced plans to appoint new statutory auditors following the withdrawal of G.K. Kedia & Co. Chartered Accountants. This development comes in light of the auditing firm's ineligibility for reappointment under Section 139(2) of the Companies Act, 2013.

Background

G.K. Kedia & Co. had served as the company's statutory auditors for ten years and was initially reappointed at the Annual General Meeting held on September 29. However, the firm later determined that Decorous Investment & Trading Co. Ltd. falls within the class of companies subject to mandatory auditor rotation provisions.

Key Developments

1. Withdrawal of Consent: G.K. Kedia & Co. has withdrawn their consent dated September 1, declaring it null and void.
2. Immediate Cessation: The auditing firm confirmed they will cease acting as statutory auditors with immediate effect.
3. No Objection: G.K. Kedia & Co. expressed no objection to the appointment of new auditors.

Company's Response

Decorous Investment & Trading Co. Ltd. has initiated the process to appoint new statutory auditors. The company has scheduled the following meetings on October 18:

Agenda for the Meetings

The meetings will address several key points:

1. Rectification of the resolution passed at the previous AGM regarding the re-appointment of G.K. Kedia & Co.
2. Consideration and approval of new statutory auditors
3. Approval for convening an Extraordinary General Meeting (EGM)
4. Authorization for necessary intimations to the Bombay Stock Exchange (BSE)

Trading Window Closure

The company has announced that the trading window for equity shares will remain closed from October 1 to October 21 for all insiders.

This situation underscores the importance of compliance with regulatory requirements and the need for companies to stay vigilant about auditor rotation rules. Shareholders and investors of Decorous Investment & Trading Co. Ltd. should keep an eye out for further announcements regarding the appointment of new statutory auditors and the upcoming Extraordinary General Meeting.