Page 363 - CA Final PARAM Digital Book.

In case a member is suspended and is not holding Certificate of Practice, he cannot in any other
capacity take up any practice separable from his capacity to practices as a member of the Institute.
This is because once a member becomes a member of the Institute, he is bound by the provisions
of the Chartered Accountants Act, 1949 and its Regulations.

➢ In case he files GST returns and appears as a consultant before various related authorities in his
capacity as a chartered accountant and a member of the Institute, having bound himself by the said
Act and its Regulations made thereunder, he cannot then set the Regulations at naught by
contending that even though he continues to be a member and has been punished by suspension,
he would be entitled to practice in some other capacity.

But if he is doing so in any other capacity such as GST Consultant wherein his capacity is not
chartered accountant in practice, he will not be held guilty for misconduct.

Part III – Case Discussion
➢ In the instant case, Mr. Dice was a practicing-chartered accountant and he was ordered to surrender
his certificate of practice and was suspended for one year. As per Mr. Dice he is doing the work of
filing GST returns and has appeared as a consultant before various related authorities as GST
Consultant which is not in capacity of a practicing-chartered accountant rather in capacity of
authorized representative. Any person who has been authorized to act as a GST Practitioner on
behalf of the concerned registered person can become authorized representative. Mr. Dice would
not be allowed to represent as a Chartered Accountant before various related authorities for the
period he remains suspended.

Part IV – Conclusion
➢ Accordingly, in the present case he is guilty of professional misconduct.

Author’s Note
#controversy

The institute has changed this answer. Earlier it was “not guilty” and accordingly the answer was drafted.
However later on the answer was changed to “guilty “only in conclusion, but the overall drafting is
still the same which creates a lot of confusion and contradiction.

Removing the contradictory part will bring the required consistency in the answer.

QNO Sec 8-- Effect of Insolvency on CA Membership Old Course –(M23M)
655.400 TITANIUM CNO-- PE.600
Mr. Sheetal is a practicing chartered accountant. Due to natural calamities and misfortune during the year
2021, he lost almost all of his wealth and became undischarged insolvent. After a few court hearings,
finally, in the year 2023, he was declared discharged insolvent and obtained a certificate from the court

stating that his insolvency was caused by misfortune without an y misconduct on his part. You are required
to comment on the above situation with reference to the Chartered Accountants Act, 1949 and Schedules
thereto, (especially from the point of section 8: Entry of name in Register of Members).
Answer Mr. Sheetal was discharged insolvent: Disabilities for the Purpose of Membership : Section 8 of the Chartered
Accountants Act, 1949 enumerates the circumstances under which a person is debarred from having his
name entered in or borne on the Register of Members, If he, 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. Here it may be noted that a person who has been removed from membership for a specified period
shall not be entitled to have his name entered in the Register until the expiry of such period.

In addition, failure on the part of a person to disclose the fact that he suffers from any one of the disabilities
would constitute professional misconduct. The name of the person, who is found to have been subject at
any time to any of the disabilities discussed in section 8, can be removed from the Register of Members by
the Council.

In the given case, it is clearly stated that Mr. Sheetal was discharged insolvent, and he has also obtained from
the court a certificate stating that his insolvency was caused by misfortune without any misconduct on his
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