Sir, The rule is, An auditor should not be indebeted to the bank(to be audited by him). What if the transaction is arms length transaction i.e., the intrest rate is same for the auditor and others.
the Firm of Chartered Accountants cannot accept branch Audit of the Bank if one of the partners have taken the loan from any branch of that bank. The members should not place themselves in position which would either compromise or jeopardize their independence.
Even it is an arms length transaction he is not allowed to do so