FORM ADT -1 MANDATORY OR NOT | MANDATORY /OPTION FILLING

Background and Previous Practice

Form ADT-1 is Mandatory or Not

Historically, there was ambiguity and divided practice regarding the filing of Form ADT-1 for the appointment of the first auditor by companies in India. Many practitioners interpreted the Companies (Audit and Auditors) Rules, 2014 to mean that ADT-1 was not strictly required for the first auditor, since Rule 4(2) referred only to Section 139(1) (appointment after AGM) and not Section 139(6) (first auditor appointment by Board). However, it was always considered a recommended best practice to file ADT-1 even for the first auditor to ensure compliance and avoid future disputes.

Current Requirement and Recent Changes: As of now, the Ministry of Corporate Affairs (MCA) has clarified and reinforced the requirement: filing Form ADT-1 is mandatory for the appointment of both the first auditor and subsequent auditors. This is in line with the Companies Act, 2013 and is further emphasized by recent compliance updates and digitization initiatives by the MCA.

For a newly incorporated company:

The Board of Directors must appoint the first auditor within 30 days of incorporation. Once appointed, the company must file Form ADT-1 with the Registrar of Companies (ROC) within 15 days of the appointment.

For existing companies:

Form ADT-1 must be filed within 15 days of the Annual General Meeting (AGM) in which the auditor is appointed or reappointed.

Upcoming Changes Effective July 14, 2025: The MCA is set to roll out a significant digital overhaul, launching the final set of 38 company forms—including audit forms like ADT-1—on July 14, 2025, as part of the MCA-21 V3 portal enhancements. This move is aimed at streamlining compliance and making e-filing more robust and user-friendly. While this update focuses on digitization, it reinforces the existing legal requirement that ADT-1 filing is mandatory for the first auditor's appointment.

Key Points on ADT-1 Filing

• Filing ADT-1 is compulsory for all companies—public, private, listed, or unlisted—regardless of whether it is for the first or subsequent auditor.

• The company, not the auditor, is responsible for filing ADT-1.

• Failure to file within the stipulated time attracts penalties, which increase with the length of the delay.

• The required documents include the board resolution or AGM resolution, auditor’s consent, and a certificate of eligibility under Section 141 of the Companies Act.

Notification and Official Reference: As of June 12, 2025, there is no new specific MCA notification that introduces a fresh legal mandate effective July 14, 2025, solely regarding the requirement to file ADT-1 for the first auditor. The obligation arises from the consistent interpretation and enforcement of the Companies Act, 2013, and the Companies (Audit and Auditors) Rules, 2014, as clarified by the MCA and various professional bodies. The July 14, 2025 date refers to the launch of new digital forms and portal enhancements, not to a change in the substantive legal requirement.

"Form ADT-1 is required to be filed within 15 days from the first board meeting of the company which is required to be held within 30 days of incorporation... All the companies are mandatorily required to file Form ADT 1, be it a listed, unlisted, public, private, or any other company."

Conclusion

• ADT-1 filing is mandatory for both first and subsequent auditor appointments.

• The July 14, 2025 date marks the digital rollout of enhanced MCA forms, not a new legal requirement for ADT-1 filing.

• Companies must ensure timely filing to avoid penalties and remain compliant.