Page 380 - CA Final PARAM Digital Book.

The question is silent about with whom the partnership has been entered into and whether the prior
permission for entering into such business has been obtained.

Part IV – Conclusion
➢ It is assumed that the persons with whom the partnership has been entered into has not been
allowed under the Regulations and the prior approval of the Council has not been obtained for
entering into such business. Hence, the Chartered Accountant shall be held guilty of professional
misconduct under Clause (4) and Clause (11).
Author’s Note
There is a old case where CA got permission to do business under clause 11, then that time ICAI said that it
means he also has permission to enter in partnership with non-CA to that particular business under clause
4. So, approval under clause 11 will mean approval to enter into partnership for such business

QNO First Schedule, Part I,Cl,6 – (Multiple Issues) Old Course – (N20E, SM21)
666.050 TITANIUM CNO – PE.1140
Mr. A, a newly qualified Chartered Accountant, started his practice and sought clients through
telephone calls from his family and friends, almost all of them employed in one or the other retail trade
business. One of his friends Mr. X gave him an idea to start online services and give stock certifications
to traders with Cash Credit Limits in Banks. Mr. A started a website with colourful catchy designs and
shared the website address on his all-social media posts and stories and tagged 30 traders of his
local community with the caption “Easy Online Stock Certification Services”. Besides, Mr. A entered
in an agreement with a Digital Marketer to give him 5% commission on each service procured through
him. Discuss if the actions of Mr. A are valid in the light of the Professional Ethics and various
pronouncements and guidelines issued by ICAI.
Part I -- Relevant Laws
▪ Clause (6) of Part I of First Schedule to the Chartered Accountants Act, 1949
Part II -- Requirements of Relevant Laws
➢ A Chartered Accountant in practice is deemed to be guilty of professional misconduct if he solicits
clients or professional work either directly or indirectly by circular, advertisement, personal
communication or interview or by any other means.

Part III – Case Discussion & Conclusion
➢ Mr. A is wrong in seeking clients through family and friends. Creating a website is not a non-compliance
provided it is in line with the guidelines issued by the Institute in this regard. One of the guidelines is
that the website should not be in push mode. Further, mentioning of clients’ names is also
prohibited as per the guidelines.
➢ In the given situation, Mr. A shared the website address on his all-social media posts and
stories and tagged 30 traders of his local community with the caption “Easy Online Stock
Certification Services” mentioning his current clients as well. This is in complete contravention of
the guidelines on website issued by the ICAI.
➢ Thus, CA, A would be held guilty of professional misconduct under clause 6 of Part 1 of First Schedule
of the Chartered Accountants Act, 1949.

QNO First Schedule, Part I,Cl,6 Advertisement (Opening Ceremony) Old Course – (M10E, PM17 SM17, SM21)
667.000 TITANIUM CNO – PE.1140 New Course – (SM23)
An advertisement was published in a Newspaper containing the photograph of Mr. X, a member of

the institute wherein he was congratulated on the occasion of the opening ceremony of his office.

Answer Part I -- Relevant Laws
▪ Clause (6) of Part I of First Schedule to the Chartered Accountants Act, 1949

Part II -- Requirements of Relevant Laws
➢ A Chartered Accountant in practice shall be deemed to be guilty of misconduct if he solicits clients
or professional work either directly or indirectly by a circular, advertisement, personal
communication or interview or by any other means.

Part III – Case Discussion

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