ADT-3 Filing — Auditor Resignation Notice

Q: Who is responsible for filing Form ADT-3?

The resigning auditor — individual or firm — must file ADT-3 under Section 140(2). The company separately files ADT-1 for the replacement auditor.

Q: What must be disclosed in the ADT-3 statement of reasons?

The auditor must disclose honest and complete reasons for resignation, including any disagreements with management, concerns about financial reporting, or detection of fraud or irregularities.

Q: What is the penalty for not filing ADT-3 on time?

Under Section 140(3), the auditor faces a penalty of ₹50,000 or total remuneration from that company, whichever is less, plus ₹500 per day for continued default up to ₹5,00,000.

Q: Can an auditor resign in the middle of the financial year?

Yes, but the resignation is effective only after the company acknowledges it. The auditor's reasons must be disclosed in the mandatory ADT-3 filing.

Q: What happens after ADT-3 is filed?

The ROC records the resignation. If reasons raise concerns, the matter may be referred to the Central Government or NFRA. The company then appoints a replacement and files ADT-1.

Complete Guide to Filing Form ADT-3 for Auditor Resignation Under Section 140(2) of the Companies Act, 2013

Form ADT-3 is the statutory notice that a resigning auditor must file with the Registrar of Companies (ROC) within 30 days of resigning from a company. Under Section 140(2) of the Companies Act, 2013, when an auditor resigns from office, it is the auditor's obligation — not the company's — to file ADT-3 disclosing the reasons for resignation and confirming there are no other relevant facts that should be brought to the notice of the company, shareholders, or the Central Government.

Failure to file ADT-3 on time exposes the resigning auditor to significant penalties. Our services assist auditors and their firms in preparing the resignation statement, drafting the reasons clearly and in compliance with regulatory expectations, and filing ADT-3 on the MCA21 portal within the prescribed deadline.

Our ADT-3 Filing Services

Resignation Statement Drafting

Drafting of the resignation letter and detailed statement of reasons as required under Section 140(2), ensuring the reasons are clear, factual, and appropriately worded for regulatory scrutiny.

ADT-3 Form Preparation

Preparation of Form ADT-3 with all mandatory disclosures, including the date of resignation, reasons for resignation, and confirmation of no other relevant facts.

MCA21 Portal Filing

End-to-end DSC-based filing of Form ADT-3 on the MCA21 portal, including payment of ROC filing fees, within the 30-day window from the date of resignation.

Company Intimation Assistance

Assistance with notifying the company of the resignation, including preparation of the resignation letter to be served on the company before initiating the ADT-3 filing.

Penalty Mitigation & Late Filing

Guidance on late filing of ADT-3 where the 30-day window has passed, including compounding applications and strategies to minimise penalty exposure.

Post-Resignation Compliance

Guidance on the auditor's residual obligations after resignation — including cooperation with the incoming auditor and responding to regulatory enquiries arising from the resignation.

Key Facts About ADT-3 Filing

ADT-3 must be filed by the resigning auditor (not the company) within 30 days of the date of resignation
The form must disclose the reasons for resignation and confirm whether any other relevant facts need to be brought to the company's notice
Failure to file ADT-3 attracts a penalty of ₹50,000 or the remuneration of the auditor, whichever is less, under Section 140(3)
ADT-3 is filed by the individual auditor or audit firm using the firm's or partner's DSC, not by the company
The resignation only takes effect after the company has acknowledged it — the auditor cannot simply stop functioning without completing the resignation formalities
The Registrar may refer the ADT-3 disclosure to the Central Government if the stated reasons raise concerns about fraud or irregularities
ADT-3 is a separate obligation from the company's obligation to appoint a new auditor and file ADT-1 for the replacement

Frequently Asked Questions

Who is responsible for filing Form ADT-3?

Form ADT-3 must be filed by the resigning auditor — the individual auditor or the audit firm — and not by the company. This is a statutory obligation placed on the auditor under Section 140(2) of the Companies Act, 2013. The company's obligation is to appoint a replacement auditor and file Form ADT-1 for that appointment. The two obligations are independent of each other.

What must be disclosed in the ADT-3 statement of reasons?

The auditor must disclose the reasons for resignation honestly and completely. The form requires the auditor to state whether there are any other facts relevant to the resignation — such as disagreements with management, concerns about financial reporting, detection of fraud or irregularities, or inability to obtain information — that should be brought to the notice of the company, shareholders, or the Central Government. Vague or incomplete disclosures are not considered compliant.

What is the penalty for not filing ADT-3 on time?

Under Section 140(3) of the Companies Act, 2013, an auditor who fails to file ADT-3 within 30 days of resignation is liable to a penalty of ₹50,000 or the total remuneration of the auditor from that company, whichever is less. If the default continues, an additional penalty of ₹500 per day may apply, subject to a maximum of ₹5,00,000. These penalties apply to the auditor personally, not to the company.

Can an auditor resign in the middle of the financial year?

Yes, an auditor can resign mid-year, but the resignation only takes legal effect once the company has been properly notified and the resignation is accepted by the Board. The auditor remains responsible for the audit work up to the effective date of resignation. Resigning during the middle of an audit engagement raises professional and regulatory concerns, and the reasons for doing so are subject to mandatory disclosure in the ADT-3 filing.

What happens after ADT-3 is filed?

Once ADT-3 is filed, the ROC records the resignation on the MCA21 portal. If the stated reasons raise concerns, the ROC may forward the matter to the Central Government or the National Financial Reporting Authority (NFRA) for further examination. The company then proceeds to appoint a replacement auditor — either in a general meeting or, in cases of casual vacancy, through the Board of Directors — and files ADT-1 for the new appointment.

File Your ADT-3 — Within 30 Days of Resignation

Expert assistance with resignation statement drafting and ADT-3 filing on MCA21 for auditors and audit firms.