This article is about section 144 of the Companies Act, 2013, not section 144 of the Income-tax Act. It bars a statutory auditor from providing certain other services to the company, because the auditor must stay independent. Any other service needs approval from the Board or audit committee.
Last reviewed: 17 October 2026. Facts checked. We opened the text of section 144 as reproduced on advocatekhoj.com (a bare-act site, not the government's own copy) and one law-firm article on auditor independence. The India Code and Registerkaro pages returned a 403 error. The section lists eight named services plus a ninth item for any other service prescribed. The law-firm article's count of 11 does not match that text, so we use the nine items. We could not confirm the March 2026 proposal below beyond that article. Check the section's current wording before you rely on the list.
What the section says in plain words
An auditor appointed under the Act may provide the company only such other services as the Board or audit committee approves. That approval does not cover a list of banned services. The ban applies whether the service is given directly or indirectly.
It reaches beyond the audited company. Section 141(3)(i) disqualifies an auditor who provides a section 144 service to the company, its holding company or its subsidiary. So the group is in scope. See Section 141: who can be an auditor.
The banned services
Section 144 lists these, items (a) to (i), as read on the bare-act page we opened.
| Clause | Service |
|---|---|
| (a) | Accounting and book-keeping services |
| (b) | Internal audit |
| (c) | Design and implementation of any financial information system |
| (d) | Actuarial services |
| (e) | Investment advisory services |
| (f) | Investment banking services |
| (g) | Rendering of outsourced financial services |
| (h) | Management services |
| (i) | Any other kind of service that may be prescribed |
That is eight named services and a catch-all. One law-firm article we read said 11 services; the section text we opened does not show that.
The grey area: management services
The Act and Rules do not define "management services". One search result said ICAI and NFRA have read the term differently, which has caused confusion. NFRA reads it broadly. If a request sounds like the firm is making management decisions, treat it as risky and take advice.
Why the line exists
Auditors review the work of those who hire them. If they also keep the books, run internal audit or design the finance systems, they end up checking their own work. See also ICAI Code of Ethics, 13th edition for the professional-ethics side.
What is still allowed
Anything not on the list can still be provided if the Board or audit committee approves it. Common examples are tax services, certifications and similar work. Independence rules in the ICAI Code and the ethics of the engagement still apply, so approval is necessary but not enough.
Proposed change, not law
The law-firm article we opened said a proposal flagged in March 2026 would add a three-year cooling-off period. Under it, outgoing auditors would not provide non-audit services to the company or its holding or subsidiary companies. The article described it as a proposal, with no date of passage or effect. We could not confirm its status. Do not plan around it until it is notified.
Who is caught: the auditor, the firm and the network
The section bars services given "directly or indirectly". Its Explanation, as reproduced on the page we opened, says an audit firm renders a service indirectly if it is given through the firm's partners, its parent, subsidiary or associate entities, or an entity the firm or a partner influences or controls or whose name or brand it uses. In practice, check three layers: the signing partner, the audit firm, and any firm in the same network. Whether a particular network firm falls within the Explanation depends on the facts, so treat it as a question for your quality-control partner.
Spotting the risky requests
Requests that often sit close to the line are worth a second look:
- "Can you write up the trial balance for us?" (accounting and book-keeping)
- "Can your team run our internal audit this year?" (internal audit)
- "Can you set up the new ERP chart of accounts and workflows?" (financial information systems)
- "Can you sit in on our monthly management calls and decide on cut-offs?" (management services)
When in doubt, decline, or ask the Board or audit committee in writing before you accept.
A service-approval checklist
- List every service the firm and its network give to the client and its group.
- Compare each against section 144.
- For anything outside the list, get a written Board or audit committee approval.
- Record the approval and the date in the engagement file.
- Re-run the check each year, and when the client acquires a new subsidiary.
- Record the check in the independence confirmation template.
Frequently Asked Questions
Can my firm do the client's bookkeeping and also audit it?
No. Accounting and book-keeping is item (a) on the barred list.
Does the ban cover the client's subsidiaries?
Yes. Section 141(3)(i) refers to the company, its holding company and its subsidiary.
Is tax advice allowed?
It is not among the named services. Get Board or audit committee approval and check the ethics rules, and check whether anything has been prescribed under item (i).
Who approves permitted services?
The Board or the audit committee, as the case may be.
What happens if an auditor provides a barred service?
The auditor can become disqualified under section 141(3)(i). Under 141(4) they would have to vacate office.
Related Articles
Statutory facts on this page are checked against their sources, and the page says where it relied on secondary reporting. How we verify · Report an error