Page 413 - CA Final PARAM Digital Book.

The members can retain full time Certificate of Practice besides being the Managing Director,
Whole-time Director or Manager of such Management Consultancy Company. There will be no
restriction on the quantum of the equity holding of the members , either individually and/ or
along with the relatives, in such Company. Such members shall be regarded as being in full- time
practice and therefore can continue to do attest function either in individual capacity or in
Proprietorship/Partnership firm in which capacity they practice and wherein they are also entitled
to train articled/audit assistants.
Part III – Case Discussion
➢ In the given case, CA R accepted the position of managing director without obtaining prior
permission from the Institute.
Part IV – Conclusion
➢ Thus, the action of CA R is valid.

QNO First Schedule, Part I,Cl,11 Business Occupation Old Course – (N08E, N11R, N12M, N13E, N15R, PM17,
713.000 (Trading in Derivative) SM17, M17E, M18R, N21M)
TITANIUM CNO – PE.1280 New Course – (SM23)
CA. Raj is a leading income tax practitioner and consultant for derivative products. He resides in Bangalore
near to the XYZ commodity stock exchange and does trading in commodity derivatives. Every day, he

invests nearly 50% of his time to settle the commodity transactions, though he has not taken any
permission for this. Is CA. Raj liable for professional misconduct?
Answer Part I -- Relevant Laws
▪ Clause (11) of Part I of the 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 engages
in any business or occupation other than the profession of Chartered Accountant unless permitted
by the Council so to engage.
However, the Council has granted general permission to the members to engage in certain specific
occupation. In respect of all other occupations specific permission of the Institute is necessary.

Part III – Case Discussion
➢ In this case, CA. Raj is engaged in the occupation of trading in commodity derivatives

Part IV – Conclusion
➢ Trading in commodity derivatives is not covered under the general permission. Hence, specific
permission of the Institute has to be obtained otherwise he will be deemed to be guilty of
professional misconduct under clause (11) of Part I of First Schedule of Chartered Accountants Act,
1949.

QNO First Schedule, Part I,Cl,11 --Business Occupation (Multiple Occupation) Old Course – (N21M,N22M)
713.500 TITANIUM CNO – PE.1280
C.A. Bahubali is Special Executive Magistrate. He also took over as the executive chairman of Software
Company on 1.4.2021. He is also a leading income tax practitioner and consultant for derivative
products. He resides in Chennai near to the ION commodity stock exchange and does trading in
commodity derivatives. Every day, he invests nearly 38% of his time to settle the commodity transactions.

He has not taken any permission for becoming Special Executive Magistrate. However, he has got special
permission of Council of ICAI for becoming executive chairman and for trading in commodity
derivatives. Is C.A. Bahubali liable for professional misconduct? Comment with reference to the Chartered
Accountants Act, 1949, and Schedules thereto.
Answer As per Clause (11) of Part I of First Schedule of Chartered Accountants Act, 1949, a Chartered Accountant in
practice is deemed to be guilty of professional misconduct if he engages in any business or occupation other

than the profession of Chartered Accountant unless permitted by the Council so to engage.

However, the Council has granted general permission to the members to engage in certain specific
occupation. In respect of all other occupations specific permission of the Institute is necessary.

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