Specific Provisions Regarding Government Companies in Corporate Law are as follows:
(1) The auditor of a government company is appointed or re-appointed by the Comptroller and Auditor General of India. The Comptroller and Auditor General of India has the power to direct the manner in which the company’s accounts are to be audited by the auditor and give such other instructions regarding any matter relating to the performance of his functions as such.
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He can also conduct a supplementary test audit of the company’s accounts by officers appointed by him. The auditor must submit a copy of his report to the Comptroller and Auditor General and such report, with his comments thereon, shall be placed before the annual general meeting of the company.
(2) Where Central Government is a member of a Government company, it shall prepare an annual report on the working and affairs of the company within three months of the annual general meeting and place it along with the audit report and comments thereon before both Houses of Parliament.
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Where a State Government is a member of a Government Company, it shall present the annual report on the working of the company along with the audit report and comment thereon before the House(s) of the State Legislature.
(3) The Central Government may, by notification in the Official Gazette, direct that any of the provisions of this Act:
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(a) Shall not apply to any Government company; or
(b) Shall apply to any Government company, only with such exceptions, modifications and adaptations, as may be specified in the notification.
(4) The following provisions of the Companies Act are not applicable to Government Companies:
(i) The provisions relating to appointment and retirement of directors (sections 255, 256 & 257) in companies wholly owned by the Government;
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(ii) The provisions relating to appointment of managing/whole-time directors and remuneration of managing director/whole-time director and manager of a company (sections 198, 259, 268, 269, 309, 310, 311, 387, & 388).