The President of India, Ram Nath Kovind has submitted the Amendment Bill 2021 to the Chartered Accountants, the Company Secretaries, and the Cost and Works Accountants.
The Chartered Accountants Act of 1949, The Cost and Works Accountants Act, of 1959, and The Company Secretaries Act, of 1980 are the bill amends. Under these three acts, it transforms the disciplinary mechanism that points time – limit for disciplinary proceedings. Whereas, the Board of Discipline and Disciplinary Committee shows more external representation which is provided by them.
The Bill made a formation of a committee which goes through the Secretary of the Ministry of Corporate Affairs. However, the Committee will provide you with the representation across three institutes made within the Acts. While the Secretary to each Council will be formed as the chief executive as the head Council by the President. While all the ensured intimations of decisions of the Council will be liable by the President.
Now, organizations should register with the institutes. The Councils should manage a register for the organizations which holds the details involving the pendency of any actionable complaint or imposition of penalty. Under these 3 Acts, there would be particular fines have been upgraded as the bill enhances. In case the owner or a partner of an organization is continuously caught under fault for misconducting for, the last 5 years, there will be disciplinary action can be charged against the organization.
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- Each council of the three Institutes which falls under the acts should constitute a Disciplinary Directorate, managed by a Director ( Discipline) who is designated officer of the institute. On the basis of the misconduct, after getting a complaint, the matter has been placed by the Director prior to the Discipline or the Disciplinary Committee. The motive of the bill is to authorize the Directorate to start investigations suo motu despite members or organizations.
- Every Council carries a Board of Discipline. Where members of the Board involve (1) presiding officer( who has experience in law and knowledge of disciplinary matters), (2) two-member, and (3) Director ( Discipline) as Secretary. This bill authorizes the 3 Councils in order to conduct various Boards. In that case, the presiding officers along with the other 2 members shouldn’t be a member of the organizations and so they will be nominated through the central authority from a panel of individuals issued by the Councils.
- Within the three acts, the Councils conduct a Disciplinary Committee comprising of (1) Presiding Officer ( president or Vice – President of the Council), (2) two people voted from the Council, and (3) two people selected by the Central government. While the amendment of the bill acts to give the presiding officer should not be a part of the institutes and will be selected through the central authority from a panel of individuals given by the Councils.
Roles of the President of the Council
- The CA Acts denotes the President of the Council as its chief executive authority whereas the other two Acts give for an officer of their Institutes or Councils to be formed as chief executive. While the bill made the secretaries of the Councils to be each chief executive and the President to be liable for assuring that the decisions brought up by the Council are upgraded.
- The Bill gives for fixing up a coordination Committee directed through the Secretary of the Ministry of Corporate Affairs. In the Coordination Committee, there will be the President, Vice President and Secretary from the 3 institutes would also be involved. However, its functions will comprise : (1) Quality improvement of academics, (2) Coordinating and collaboration among the professions, and (3) making recommendations on regulatory policies for the works.
Registration of organizations
The Bill also includes that organizations should register with the institutes by creating an application to each Council of the Institutes. Also, the Councils should manage a register of the organization that comprises details like pendency of any actionable complaint or imposition of penalty against the firms.
In case of professional or another mischief, the Disciplinary Committees may fall under the act : (1) elimination or reprimand of the individual from the register of the Institute, or (2) upgraded fine which is up to 5 lakh rupees. The bill enhanced the amount of penalty to Rs 10 lakh. The Bill also includes that if an owner or partner of an organization is constantly found culpable of misconduct in the last 5 years, then the Disciplinary Committee might take some particular actions against the organization. And the action involves (1) removing the organization from embarking on activities relates to the profession of charted account, cost accountant, and the company secretary, and also the case might be increased for up to 2 years or (2) imposing a fine of up to Rs 50 lakh.