Immediately' or ‘within such time'?
AS per Section 143(12) of the Companies Act, if an auditor of a company, in the course of the performance of his duties as auditor, has reason to believe that an offence involving fraud is being or has been committed against the company by officers or employees of the company, he shall immediately report the matter to the Central Government within such time and in such manner as may be prescribed.
A Member of the Lok Sabha had a doubt - Is it ‘immediately' or is it ‘within such time'?. He said, "When a fraud happens, if it is not reported immediately, if it is reported after it becomes a public issue, if it is reported after they have taken deposit from public or if it is reported after they have taken a bank loan, I think it becomes too late."
The Government has already clarified this position in the Companies (Audit and Auditors) Rules, 2014 , Rule 13 of which stipulates,
13. Reporting of frauds by auditor.- (1) For the purpose of sub-section (12) of section 143, in case the auditor has sufficient reason to believe that an offence involving fraud, is being or has been committed against the company by officers or employees of the company, he shall report the matter to the Central Government immediately but not later than sixty days of his knowledge …