‘ICAI Disciplinary Body can Act Against CA Firms’

Sending a stern message to chartered accountant firms to enhance accountability and maintain transparency, the Delhi High Court on Friday held that the Institute of Chartered Accountants of India’s (ICAI) disciplinary body is empowered to proceed for misconduct even against CA firms besides individual chartered accountants.

The court said that there was a need for enhancing and strengthening disciplinary mechanisms against CA firms by expediting notification of amendments to Chartered Accountants, Cost and Works Accountants and the Company Secretaries (Amendment) Act, 2022, which states that proceedings for misconduct can be held against CA firms as well.

 Dismissing a batch of 10 petitions filed by individual CAs from various firms, including BSR and Associates LLP, Price Waterhouse, and Lovelock & Lewes, Justice Prathiba M. Singh CAs are like gatekeepers said financial system who can stop any misdemeanor in accounting by conducting proper audits and continuous super- vision of their clients, and that any omission or laxity in discharge of duties could lead to large-scale losses and financial fraud.

The court also imposed a fine of *1 lakh on each petitioner to be paid to Delhi High Court Bar Clerk Association. The petitioners are Rakesh Dewan (BSR and Associates LLP), Harinderjit Singh and Abhishek Rara (Price Waterhouse & Co. Chartered Accounts LLP), Usha Rajeev and Priyanshu Dinesh kumar Gundana (Dalal and Shah LLP), Rahul Chattopadhyay (Price Waterhouse & Co. Chennai, LLP), Rajan Wadhawan (Price Waterhouse & Co. LLP), Amitesh Dutta (Price Water- house & Co. Bangalore, LLP), Usha Rajeev (Price Waterhouse, Kolkata) and Anurag Khandelwal (Love-lock & Lewes, Kolkata).

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