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Professional Misconduct applicable for CA in Practice

Part I of First and Second Schedule to the Chartered Accountants Act, 1949 deals with professional misconduct specifically applicable to CA in practice.

In accordance with section 22 of the Chartered Accountants Act, 1949 the expression “professional or other misconduct” shall be deemed to include any act or omission provided in any of the Schedules. There are two schedules under the CA Act, 1949 viz. First Schedule and Second Schedule.

The First Schedule has four parts whereas the Second Schedule has only three parts. However, the act or omission mentioned in second schedule pertains to graver misconduct and higher punishment in compare to the first schedule.

If a CA in practice found guilty of professional misconduct mentioned in the Part I of First Schedule, the Board of Discipline shall after giving an opportunity of being heard may take any one or more of the following actions, namely:

(a) reprimand the member;

(b) remove the name of the member from the Register up to a period of 3 months;

(c) impose such fine as it may think fit, which may extend to ₹1,00,000.

Whereas, if a CA in practice found guilty of professional misconduct mentioned in the Part I of Second Schedule or both the First Schedule and the Second Schedule, the Disciplinary Committee shall after giving an opportunity of being heard may take any one or more of the following actions, namely:

(a) reprimand the member;

(b) remove the name of the member from the Register permanently or for such period, as it thinks fit;

(c) impose such fine as it may think fit, which may extend to ₹5,00,000.

Part I of both schedule deals with the Professional Misconduct in relation to Chartered Accountants in practice. Accordingly, there are total 22 clauses (12+10) which are specifically related to Professional misconduct applicable for CA in practice.

Professional Misconduct applicable for CA in Practice
Part I of First Schedule (12 Clauses)
Part I of Second Schedule (10 Clauses)
Clause 1: Allow Name
Clause 1: Client’s Information
Clause 2: Share Profits
Clause 2: Report without Examination
Clause 3: Accepts Profits
Clause 3: Accuracy of Forecast
Clause 4: Enters into Partnership
Clause 4: Substantial Interest
Clause 5: Secure Professional Business
Clause 5: Material Facts
Clause 6: Solicits Clients or Professional Work
Clause 6: Material Misstatement
Clause 7: Advertises Attainments or use Designation
Clause 7: Due Diligence
Clause 8: Communicate with Previous Auditor
Clause 8: Sufficient Information
Clause 9: Comply Sections 139-142
Clause 9: SA and Guidance Note
Clause 10: Percentage of Profits
Clause 10: Money of Clients
Clause 11: Engages in other Business
Clause 12: Allow to Sign

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2 Responses to Professional Misconduct applicable for CA in Practice

  1. Uday Gupta says:

    keep quite. don’t take any panga with your principal. ICAI is tooth less institution. not take any action of his practicing CA. Even save him. Very lengthy and cumbersome process. its take to solve a case around 10 years.

  2. SAGAR DEDHIA says:

    Dear Sir,

    My Principal from where I am doing articleship is forcing my to go to a Public Mall and requires me to tell the customers who visit the mall that our firm is well versed with GST works and GST Registration and indirectly asking me to get the potential clients for our firm.
    Is this violation of CA Professional Ethics and can i take any action against this?
    Please, help me and suggest the best at the earliest.
    Thanking you in anticipation.

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