CHARTERED ACCOUNTANTS ACT, 1949
(1) This Act may be called the Chartered Accountants Act, 1949.
1[(2) It extends to the whole of India2[* * * *].]
(3) It shall come into force on such date3as the Central Government may, by notification in the Official Gazette, appoint in this behalf.
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1. Substituted for sub-section (2) by A. L.O., 1950.
2. Words "except the State of Jammu and Kashmir" omitted by Central Laws (Extension to Jammu and Kashmir) Act, (25 of 1968), S. 2 and Sch, (15-8-1968).
3. The Act came into force on 1-7-1949--
(1) In this Act, unless there is anything repugnant in the subject or context,--
(a) "associate" means an associate member of the Institute;
5[(aa) "Authority" means the Appellate Authority constituted under section 22A;
(aaa) "Board" means the Quality Review Board constituted under section 28A;]
(b) "chartered accountant" means a person who is a member of the Institute1[* * *];
(c) "Council" means the Council of the Institute;
(d) "holder of a restricted certificate" means a person holding a permanent or temporary restricted certificate granted by2[State] Government under the Restricted Certificates Rules, 1932;
(e)
(1) All persons whose names are entered in the Register at the commencement of this Act and all persons who may hereafter have their names entered in the Register under the provisions of this Act, so long as they continue to have their names borne on the said Register, are hereby constituted a body corporate by the name of the Institute of Chartered Accountants of India, and all such persons shall be known as members of the Institute.
(2) The Institute shall have perpetual succession and a common seal and shall have power to acquire, hold and dispose of property, both movable and immoveable, and shall by its name sue or be sued.
(1) Any of the following persons shall be entitled to have his name entered in the Register, namely,--
(i) any person who is a registered accountant or a holder of a restricted certificate at the commencement of this Act;
(ii) any person who has passed such examination and completed such training as may be prescribed for members of the Institute;
(iii) any person who has passed the examination for the Government Diploma in Accountancy or an examination recognised as equivalent thereto by the rules for the award for the Government Diploma in Accountancy before the commencement of this Act, and who, although not duly qualified to be registered as an accountant under the Auditors' Certificates Rules, 1932, fulfils such conditions as the Central Government may specify in this behalf;
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(1) The members of the Institute shall be divided into two classes designated respectively as associates and fellows.
(2) Any person shall, on his name being entered in the Register, be deemed to have become an associate member of the Institute and be entitled to use the letters A. C. A. after his name to indicate that he is an associate member of the Institute of Chartered Accountants.
2[(3) A member, being an associate who has been in continuous practice in India for at least five years, whether before or after the commencement of this Act, or whether partly before and partly after the commencement of this Act, and a member who has been an associate for a continuous period of not less than five years and who possesses such qualifications as the Council may prescribe with a view to ensuring that he has experience equivalent to the exper
(1) No member of the Institute shall be entitled to practise1[whether in India or elsewhere] unless he has obtained from the Council a certificate of practice :
3[(2) Every such member shall pay such annual fee for his certificate as may be determined, by notification, by the Council, which shall not exceed rupees three thousand, and such fee shall be payable on or before the 1st day of April in each year:
Provided that the Council may with the prior approval of the Central Government, determine the fee exceeding rupees three thousand, which shall not in any case exceed rupees six thousand.]
4[(3) The certificate of practice obtained under sub-section (1) may be cancelled by the Council under such circumstances as may be prescribed.]
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1[Every member of the Institute in practice shall, and any other member may, use the designation of a chartered accountant and no member using such designation shall use any other description, whether in addition thereto or in substitution therefor]:
Provided that nothing contained in this section shall be deemed to prohibit any such person from adding any other description or letters to his name, if entitled thereto, to indicate membership of such other Institute of Accountancy, whether in India or elsewhere, as may be recognised in this behalf by the Council, or any other qualification that he may possess, or to prohibit a firm, all the partners of which are members of the Institute and in practice, from being known by its firm name as Chartered Accountants.
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1. Subs
Notwithstanding anything contained in section 4, a person shall not be entitled to have his name entered in or borne on the Register if he--
(i) has not attained the age of twenty-one years at the time of his application for the entry of his name in the Register; or
1[(ii) is of unsound mind and stands so adjudged by a competent Court or]
(iii) is an undischarged insolvent; or
(iv) being a discharged insolvent, has not obtained from the Court a certificate stating that his insolvency was caused by misfortune without any misconduct on his part; or
(v) has been convicted by a competent Court, whether within or without India, of an offence involving moral turpitude and punishable with transportation or impri
(1) There shall be a Council of the Institute for the management of the affairs of the Institute and for discharging the functions assigned to it under this Act.
3[(2) The Council shall be composed of the following persons, namely:-
(a) not more than thirty-two persons elected by the members of the Institute from amongst the fellows of the Institute chosen in such manner and from such regional constituencies as may be specified:
Provided that a fellow of the Institute, who has been found guilty of any professional or other misconduct and whose name is removed from the Register or has been awarded penalty of fine, shall not be eligible to contest the election,-
(i) in case of misconduct falling under the First Schedule of this Act, for a period of th
A member of the Council, elected or nominated under sub-section (2) of section 9, shall be eligible for re-election or, as the case may be, renomination:
Provided that no member shall hold the office for more than three consecutive terms:
Provided further that a member of the Council, who is or has been elected as President under sub-section (1) of section 12, shall not be eligible for election or nomination as a member of the Council.]
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1. Substituted by the Chartered Accountants (Amendment) Act 1959 (15 of 1959), Section 9 (1-7-1959).
2. Substituted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006. Prior to substitution, it read as under:-
In case of any dispute regarding any election under clause (a) of sub-section (2) of section 9, the aggrieved person may make an application within thirty days from the date of declaration of the result of election to the Secretary of the Institute, who shall forward the same to the Central Government.
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1. Inserted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
(1) On receipt of any application under section 10A, the Central Government shall, y notification, establish a Tribunal consisting of a Presiding Officer and two other Members to decide such dispute and the decision of such Tribunal shall be final.
(2) A person shall not be qualified for appointment,-
(a) as a Presiding Officer of the Tribunal unless he has been a member of the Indian Legal Service and has held a post in Grade I of the service for at least three years;
(b) as a Member unless he has been a member of the Council for at least one full term and who is not a sitting member of the Council or who has not been a candidate in the election under dispute; or
(c) as a Member unless he holds the post of a Joint Secretary to the Government of Ind
If any body of persons referred to in section 9 fails to elect any of the members of the Council which it is empowered under that section to elect, the Central Government may nominate a person duly qualified to fill the vacancy, and any person so nominated shall be deemed to be a member of the Council as if he had been duly elected.
(1) The Council at its first meeting shall elect two of its members to be respectively the President and Vice President thereof, and so often as the office of the President or the Vice-President becomes vacant the Council shall choose another person to be the President or the Vice-President as the case may be:
Provided that on the first constitution of the Council a member of the Council nominated in this behalf by the Central Government shall discharge the functions of the President, until such time as a President is elected under the provisions of this sub-section.
(2) The President shall be the Chief Executive Authority of the Council.
(3) The President or the Vice-President shall hold office for a period of one year from the date on which he is chosen but so as not to extend beyond his ter
(1) Any member of the Council may at any time resign his membership by writing under his hand addressed to the President, and the seat of such member shall become vacant when such resignation is notified in the Official Gazette.
(2) A member of the Council shall be deemed to have vacated his seat if he is declared by the Council to have been absent without sufficient excuse from three consecutive meetings of the Council, 2[or he has been found guilty of any professional or other misconduct and awarded penalty of fine,] or if his name is, for any cause, removed from the Register under the provisions of Section 20.
(3) A casual vacancy in the Council shall be filled by fresh election from the constituency concerned or by nomination by the Central Government, as the case may be, and the person elected or nominated to fill the vacancy shall
1[(1)] The duration of any Council constituted under this Act shall be three years from the date of its first meeting, on the expiry of which it shall stand dissolved and a new Council constituted in accordance with the provisions of this Act.
1[(2) Notwithstanding the expiration of the duration of a Council (hereinafter referred to as the former Council), the former Council shall continue to exercise its functions until a new Council is constituted in accordance with the provisions of this Act, and on such constitution, the former Council shall stand dissolved.]
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1. Section 14 renumbered as sub-section (1) thereof and sub-section (2) added thereto by the Chartered Accountants (Amendment) Act (15 of 1959), Section 12 (1-7-1959).
(1) The Institute shall function under the overall control, guidance and supervision of the Council and the duty of carrying out the provisions of this Act shall be vested in the Council.
(2) In particular, and without prejudice to the generality of the foregoing powers, the duties of the Council shall include -
(a) to approve academic courses and their contents;
(b) the examination of candidates for enrolment and the prescribing of fees therefor;
(c) the regulation of the engagement and training of articled and audit assistants;
(d) the prescribing of qualifications for entry in the Register;
(e) the recognition of foreign qualifications and training for the p
(1) Subject to the provisions of this Act, any University established by law or any body affiliated to the Institute, may impart education on the subjects covered by the academic courses of the Institute.
(2) The Universities or bodies referred to in sub-section (1) shall, while awarding degree, diploma or certificate or bestowing any designation, ensure that the award or designation do not resemble or is not identical to one awarded by the Institute.
(3) Nothing contained in this section shall enable a University or a body to adopt a name or nomenclature which is in any way similar to that of the Institute.]
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1. Inserted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
(1) For the efficient performance of its duties, the Council shall-
(a) appoint a Secretary to perform such duties as may be prescribed;
(b) appoint a Director (Discipline) to perform such functions as are assigned to him under this Act and the rules and regulations framed thereunder.
(2) The Council may also-
(a) appoint such other officers and employees as it considers necessary;
(b) require and take from the Secretary or from any other officer or employee such security for the due performance of his duties, as the Council considers necessary;
(c) prescribe the salaries, fees, allowances of the officers and employees and their terms and conditions of service;
(1) The Council shall constitute from amongst its members the following Standing Committees, namely:--
(i) an Executive Committee,
(ii) an Examination Committee, and
2[(iii) a Finance Committee.]
3[(2) The Council may also form such other committees from amongst its members as it consider necessary for the purpose of carrying out the provisions of this Act, and any Committee so formed may, with the sanction of the Council, co-opt such other members of the Institute not exceeding one-third of the members of the committee as it thinks fit, and any member so co-opted shall be entitled to exercise all the rights of a member of the committee.
(3) Each of the Standing Committees shall consist of the President a
(1) There shall be established a fund under the management and control of the Council into which shall be paid all monies received by the Council and out of which shall be met all expenses and liabilities properly incurred by the Council.
(2) The Council may invest any money for the time being standing to the credit of the fund in any Government security or in any other security approved by the Central Government.
2[(3) The Council shall keep proper accounts of the fund distinguishing capital from revenue in the manner prescribed.
(4) The Council shall prepare in the manner prescribed and approve, prior to the start of the financial year, an annual financial statement (the budget) indicating all its anticipated revenues as well as all proposed expenditures for the forthcoming year.
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(1) The council shall maintain in the prescribed manner a Register of the Members of the Institute.
(2) The Register shall include the following particulars about every member of the Institute, namely,--
(a) his full name, date of birth domicile, residential and professional addresses;
(b) the date on which his name is entered in the Register;
(c) his qualifications;
(d) whether he holds a certificate of practice; and
(e) any other particulars which may be prescribed.
1[(3) The council shall cause to be published in such manner as may be prescribed, a list of members of the Institute as on the 1st day of April of eac
(1) The Council may remove from the Register the name of any member of the Institute
(a) who is dead; or
(b) from whom a request has been received to that effect, or
(c) Who has not paid any prescribed fee required to be paid by him; or
(d) Who is found to have been subject at the time when his name was entered in the Register, or who at any time thereafter has become subject, to any of the disabilities mentioned in Section 8, or who for any other reason has ceased to be entitled to have his name borne on the Register.
(2) The Council shall remove from the Register the name of any member in respect of whom an order has been passed under this Act removing him from membership of the Institute.]
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(1) The Council shall, by notification, establish a Disciplinary Directorate headed by an officer of the Institute designated as Director (Discipline) and such other employees for making investigations in respect of any information or complaint received by it.
(2) On receipt of any information or complaint along with the prescribed fee, the Director (Discipline) shall arrive at a prima facie opinion on the occurrence of the alleged misconduct.
(3) Where the Director (Discipline) is of the opinion that a member is guilty of any professional or other misconduct mentioned in the First Schedule, he shall place the matter before the Board of Discipline and where the Director (Discipline) is of the opinion that a member is guilty of any professional or other misconduct mentioned in the Second Schedule or in both the Schedules, he shall place t
(1) The Council shall constitute a Board of Discipline consisting of -
(a) a person with experience in law and having knowledge of disciplinary matters and the profession, to be its presiding officer;
(b) two members one of whom shall be a member of the Council elected by the Council and the other member shall be nominated by the Central Government from amongst the persons of eminence having experience in the field of law, economics, business, finance or accountancy;
(c) the Director (Discipline) shall function as the Secretary of the Board.
(2) The Board of Discipline shall follow summary disposal procedure in dealing with all cases before it.
(3) Where the Board of Discipline is of the opinion that a me
(1) The Council shall constitute a Disciplinary Committee consisting of the President or the Vice-President of the Council as the Presiding Officer and two members to be elected from amongst the members of the Council and two members to be nominated by the Central Government from amongst the persons of eminence having experience in the field of law, economics, business, finance or accountancy:
Provided that the Council may constitute more Disciplinary Committees as and when it considers necessary.
(2) The Disciplinary Committee, while considering the cases placed before it shall follow such procedure as may be specified.
(3) Where the Disciplinary Committee is of the opinion that a member is guilty of a professional or other misconduct mentioned in the Second Schedule or both the First Schedul
For the purposes of an inquiry under the provisions of this Act, the Authority, the Disciplinary Committee, Board of Discipline and the Director (Discipline) shall have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following matters, namely:-
(a) summoning and enforcing the attendance of any person and examining him on oath;
(b) the discovery and production of any document; and
(c) receiving evidence on affidavit.
Explanation.-For the purposes of sections 21, 21A, 21B, 21C and 22, "member of the Institute" includes a person who was a member of the Institute on the date of the alleged misconduct although he has ceased to be a member of the Institute at the time of the inquiry.]
All complaints pending before the Council or any inquiry initiated by the Disciplinary Committee or any reference or appeal made to a High Court prior to the commencement of the Chartered Accountants (Amendment) Act, 2006, shall continue to be governed by the provisions of this Act, as if this Act had not been amended by the Chartered Accountants (Amendment) Act, 2006.]
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1. Inserted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
For the purposes of this Act, the expression "professional or other misconduct" shall be deemed to include any act or omission provided in any of the Schedules, but nothing in this section shall be construed to limit or abridge in any way the power conferred or duty cast on the Director (Discipline) under sub-section (1) of section 21 to inquire into the conduct of any member of the Institute under any other circumstances.
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1. Footnote under Section 21.
2. Substituted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006. Prior to substitution, it read as under:-
(1) The Central Government shall, by notification, constitute an Appellate Authority consisting of-
(a) a person who is or has been a judge of a High Court, to be its Chairperson;
(b) two members to be appointed from amongst the persons who have been members of the Council for at least one full term and who is not a sitting member of the Council;
(c) two members to be nominated by the Central Government from amongst persons having knowledge and practical experience in the field of law, economics, business, finance or accountancy.
(2) The Chairperson and other members shall be part-time members.]
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1. Footnote under Section 21.
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(1) A person appointed as the Chairperson shall hold office for a term of three years from the date on which he enters upon his office or until he attains the age of sixty-five years, whichever is earlier.
(2) A person appointed as a member shall hold office for a term of three years from the date on which he enters upon his office or until he attains the age of sixty-two years, whichever is earlier.
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1. Substituted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
The allowances payable to, and other terms and conditions of service of, the Chairperson and members and the manner of meeting expenditure of the Authority by the Council and such other authorities shall be such as may be specified.
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1. Substituted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
(1) The office of the Authority shall be at Delhi.
(2) The Authority shall regulate its own procedure.
(3) All orders and decisions of the Authority shall be authenticated by an officer duly authorised by the Chairperson in this behalf.
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1. Substituted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
(1) The Council shall make available to the Authority such officers and other staff members as may be necessary for the efficient performance of the functions of the Authority.
(2) The salaries and allowances and conditions of service of the officers and other staff members of the Authority shall be such as may be prescribed.
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1. Substituted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006.
(1) The Chairperson or a member may, by notice in writing under his hand addressed to the Central Government, resign his office:
Provided that the Chairperson or a member shall, unless he is permitted by the Central Government to relinquish his office sooner, continue to hold office until the expiry of three months from the date of receipt of such notice or until a person duly appointed as his successor enters upon his office or until the expiry of term of office, whichever is earlier.
(2) The Chairperson or a member shall not be removed from his office except by an order of the Central Government on the ground of proved misbehaviour or incapacity after an inquiry made by such person as the Central Government may appoint for this purpose in which the Chairperson or a member concerned has been informed of the charges against him and given
(1) Any member of the Institute aggrieved by any order of the Board of Discipline or the Disciplinary Committee imposing on him any of the penalties referred to in sub-section (3) of section 21A and sub-section (3) of section 21B, may within ninety days from the date on which the order is communicated to him, prefer an appeal to the Authority:
Provided that the Director (Discipline) may also appeal against the decision of the Board of Discipline or the Disciplinary Committee to the Authority, if so authorised by the Council, within ninety days:
Provided further that the Authority may entertain any such appeal after the expiry of the said period of ninety days, if it is satisfied that there was sufficient cause for not filing the appeal in time.
(2) The Authority may, after calling for the reco
(1)1[For the purpose of advising and assisting it on matters concerning its functions, the Council may constitute such Regional Councils] as and when it deems fit for one or more of the regional constituencies that may be specified by the Central Government under clause (a) of sub-section (2) of Section 9.
(2) The Regional Councils shall be constituted in such manner and exercise such functions as may be prescribed.
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1. Substituted for the words "The Council may constitute such Regional Councils," by the Chartered Accountants (Amendment) Act (15 of 1959), Section 20 [1-7-1959].
Any person who,--
(i) not being a member of the Institute.--
(a) represents that he is a member of the Institute; or
(b) uses the designation Chartered Accountant, or
(ii) being a member of the Institute, but not having a certificate of practice, represents that he is in practice, or practices as a chartered accountants,
shall be punishable on first conviction with fine which may extend to one thousand rupees, and on any subsequent conviction with imprisonment which may extend to six months or with fine which may extend to five thousand rupees, or with both.
2[***]
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1. Inserted by the Chartered Accountants (Amendment) Act (15 of 1959), Section 21 [1-7-1959].
2. Omitted by the Chartered Accountants (Amendment) Act, 2006, dated 22nd March, 2006. Prior to omission, it read as under:-
"124A. Penalty for using name of the Council, awarding degrees of chartered aaccountancy, etc.--
(1) Save as otherwise provided in this Act, no person shall--
(i) use a name or a common seal which is identical with the name or the common seal of the Institute or so nearly resembles it as to deceive or as is likely to deceive the public;
(ii) award any degree, diploma or
(1) No company, whether incorporated in India or elsewhere, shall practice as chartered accountants.
(2) If any company contravenes the provisions of sub-section (1), then, without prejudice to any other proceedings which may be taken against the company, every director, manager, secretary and any other officer thereof who is knowingly a party to such contravention shall be punishable with fine which may extend on first conviction to one thousand rupees, and on any subsequent conviction to five thousand rupees.
(1) No person other than a member of the Institute shall sign any document on behalf of a1[chartered accountant in practice] or a2[firm of such chartered accountants] in his or its professional capacity.
3[(2) Any person who contravenes the provisions of sub-section (1) shall, without prejudice to any other proceedings, which may be taken against him, be punishable on first conviction with a fine not less than five thousand rupees but which may extend to one lakh rupees, and in the event of a second or subsequent conviction with imprisonment for a term which may extend to one year or with fine not less ten thousand rupees but which may extend to two lakh rupees or with both.]
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1. Substituted for the words "chartered accountant" by the Chartered Accountants (Amendment) A
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