SC stays Company Registrar’s order

Kathmandu, May 4 :

Responding to a writ petition filed by T R Upadhay, chartered accountant and others, the Supreme Court (SC) yesterday issued an injunction staying the order of the Office of Company Registrar (OCR) dated February 15, 2006.

A division bench of SC justices, comprising of Ramnagina Singh and Kalyan Shrestha, issued a stay order on the OCR’s order, which had interpreted that the three years’ tenure of auditors of a public company should be counted with retrospective effect, that is before the date of the Company Ordinance 2062 came into force.

By this order, incumbent auditors of public companies, would be eligible for reappointment even where they had served three years or more, as the three years’ limitation would be applicable only in respect to appointments made after October 9, 2005, on which date the Ordinance became effective.

According to the sources, the decision of OCR, which was also endorsed by the secretary of the ministry of industry, commerce and supplies, was ‘against jurisprudence and ill-motivated’ and was taken solely to provide an unlawful advantage to a handful people.

It is also learnt that aggrieved parties are contemplating further legal action against defaulting officials, claiming ‘liquidated damage’.