Statutory Auditor act as Tax Auditor

(vi) a person who by virtue of the above listed provisions is disqualified for appointment as Auditor of any other body corporate which is that company's
subsidiary or holding company or a subsidiary of that company's holding
company or would be so disqualified if the body corporate were a company.
If after his appointment, an Auditor becomes subject to any of the disqualifications
listed above, he shall be deemed to have vacated his office forthwith.
(c) Can an Internal Auditor be Appointed as Statutory Auditor?
The Internal Auditor is appointed by the management and hence is in the position of
an employee, whereas Statutory Auditor is appointed by the company in accordance with the provisions of Section 224 and the Auditor is required to perform the duties enjoined upon him under Section 227 and rules/ orders issued thereunder. If the Statutory Auditor of the company is also the Internal Auditor it would not be possible for him to give an independent and objective report under Section 227 read with para (4A) of the MAOCARO and as such an Internal Auditor cannot act as Statutory Auditor.
Also, since Internal Auditor is an employee of the company he suffers from disqualification under Section 226 (3).
(d) Can a Statutory Auditor act as Tax Auditor?
Any chartered accountant in practice can perform Tax audit. There will be no conflict between the duty of the Statutory Auditor and the Tax Auditor. In view of this, the Statutory Auditor could be entrusted with the work of Tax audit.

Q: 19. What persons are disqualified from being appointed as Auditors of a company? State also the number of companies in which a person may be appointed as
Auditor. [C.A. (Final) May, 1986J
.9Lns .

Disqualifications of an Auditor
Please see answer to Q. 18 (b).
Ceiling on Audits (Restriction on Number of Audits)
The Companies (Amendment) Act, 1974 added two new sub-sections, viz., 224(1) and 224(1C), with a view to restricting the number of companies in which a person can be appointed as an Auditor. The idea probably is to prevent concentration of audits in few hands. Section 224 was further amended by the Amendment Act of 1988.
According to section 224 (18), an individual cannot be Auditor of more than twenty companies at a time. Further, out of these twenty companies, not more than ten sno'uld be companies having a paid-up share capital of Rs. 25 lakhs or I.!l0re. In case the Auditor is a partnership firm, the ceiling is twenty companies per partner of the firm. And where any partner is also a partner in any other firm or firms of Auditors, the overall ceiling in relation to such a partner will be twenty.
Section 224 (18) was amended by the Companies (Amendment) Act, 1988 to disallow the appointment of persons who are in full time employment elsewhere. Even in case of partnerships, such a partner shall be excluded from counting the number of audits per partner. However, although intention of the Government seemed to be as aforesaid, a drafting error of the section has resulted in unwarranted interpretation