The High Court held that the Institute of Chartered Accountants ...

Empowered to take disciplinary action against CA firms for misconduct, ICAI can hold firms accountable under CA Act.

Case Laws     Indian Laws

July 15, 2024

The High Court held that the Institute of Chartered Accountants of India (ICAI) is empowered to take disciplinary action against Chartered Accountant firms for professional misconduct under the Chartered Accountants Act, 1949, and not just against individual members. Sections 21A and 21B of the Act, along with Rule 8 of the 2007 Rules, enable the ICAI's Disciplinary Committee to issue notices to firms and hold them accountable for alleged misconduct, particularly in cases involving long-term arrangements or agreements spanning multiple individuals. If no specific member assumes responsibility, the firm as a whole shall be held responsible. The Court emphasized the need for robust disciplinary mechanisms against firms to enhance accountability and transparency in the profession. The writ petitions challenging the ICAI's authority were dismissed with costs, and the ICAI was directed to proceed in accordance with the law.

View Source