Page 457 - CA Final PARAM Digital Book.

QNO Multiple Cases Old Course-- (N21R)
770.500 TITANIUM CNO -- Unique
The Director (Discipline) of the ICAI received information of alleged misconduct against Mr. Jayprakash,
the proprietor of JP & Associates, as follows:-

(i) Audit of a college was accepted by JP & Associates in which Mr. Jayprakash is working as a part-time
lecturer and also, he had not taken permission of the ICAI for working as a part-time lecturer in the
college.

(ii) An event relating to Corporate Social Responsibility was sponsored by JP & Associates, whereby in
the sponsorship banner, name of Mr. Jayprakash as ‘CA Jayprakash, Proprietor, JP C Associates’ was
mentioned.

On the basis of above information and along with certain evidence against Mr. Jayprakash, he was found
guilty and so he was reprimanded and a fine of ₹ 1 lakh was imposed by an order passed against him
dated 12th July, 2020.

Against the said order, Mr. Jayprakash preferred an appeal with the Appellate Authority on 17th August,
2020 by submitting a statement of appeal along with the application form of appeal. During such
appellate proceedings, it was discovered that the said statement of appeal contained some facts
which were false to which Mr. Jayprakash admitted it to be false and apologized for it.

(a) Mr. Jayprakash has violated which of the provisions of the Chartered Accountants Act, 1949?

(b) Before which authority, the matter of Mr. Jayprakash would have been placed and what maximum
punishment could have been imposed on him by the said authority in accordance with the Chartered
Accountant Act, 1949?
Answer Mr. Jayprakash has violated following provisions of the Chartered Accountants Act, 1949:

(i) As per Clause (4) of Part I of the Second Schedule to the Chartered Accountants Act, 1949, a
Chartered Accountant in practice shall be deemed to be guilty of professional misconduct, if he
expresses his opinion on financial statements of any business or enterprise in which he, his firm, or a
partner in his firm has a substantial interest.

In this connection, as per the decision of the Council of the ICAI, a Chartered Accountant should not
by himself or in his firm name accept the audit of a college, if he is working as a part-time lecturer in
the college.

Thus, by accepting audit of a college in which he is working as a part -time lecturer, Mr. Jayprakash
has violated the restriction imposed under Clause (4) of Part I of the Second Schedule to the
Chartered Accountants Act, 1949.

(ii) As per Clause (11) of Part I of the First Schedule to the Chartered Accountants Act, 1949, a
Chartered Accountant in practice shall be 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.

Members of the Institute in practice may engage in a part-time or full-time tutorship under any
educational institution other than the coaching organization of the Institute, after obtaining the
specific and prior approval of the Council in each case.

Mr. Jayprakash had not taken permission of the ICAI for working as a part -time lecturer in the
college and so has violated the restriction imposed under Clause (11) of Part I of the First Schedule to
the Chartered Accountants Act, 1949.

As per Clause (6) of Part I of the First Schedule to the Chartered Accountants Act, 1949, a
Chartered Accountant in practice shall be deemed to be guilty of professional misconduct, if he
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