Cost And Works Accountants Act, 1959
[As amended by the Cost
and Works Accountants
(Amendment) Act, 2006]
[23 OF 1959]
An Act to make
provision for the regulation of the profession of cost and works accountants.
BE it enacted by
Parliament in the Tenth Year of the
PRELIMINARY
Short title, extent and commencement.
1. (1) This Act may be called the Cost and Works
Accountants Act, 1959.
(2) It extends to the whole of
(3) It shall come into force on such date as the Central
Government may, by notification in the Official Gazette, appoint.
Definitions and interpretation.
2. (1) In this Act,
unless the context otherwise requires,—
(a) “associate” means an associate member of the Institute;
[(aa) “Authority” means the Appellate Authority referred to in
section 22A;
(aaa) “Board” means the Quality Review Board constituted under
section 29A;]
(b) “cost accountant” means a person who is a member of the
Institute;
(c) “Council” means the Council of the
Institute;
(d) “dissolved company” means the
(e) “fellow” means a fellow of the Institute;
(f) “Institute”
means the
[(fa) “notification” means a notification
published in the Official Gazette;]
(g) “prescribed”
means prescribed by regulations made under this Act;
(h) “President” means the President of
the Council;
(i) “Register” means the Register of
members maintained under this Act;
[(ia) “specified” means specified by rules
made by the Central Government under this Act;
(ib) “Tribunal” means a Tribunal established under sub-section
(1) of section 10B;]
(j) “Vice-President” means the
Vice-President of the Council;
(k) “year” means the period commencing on the 1st day of April of
any year and ending on the 31st day of March of the succeeding year.
(2) Save as otherwise provided in this Act, a member of the
Institute shall be deemed “to be in practice” when, individually or in
partnership with one or more members of the Institute in practice, he, in
consideration of remuneration received or to be received,—
(i) engages himself in the practice of cost and works
accountancy; or
(ii) offers
to perform or performs services involving the costing or pricing of goods or
services or the preparation, verification or certification of cost accounting
and related statements or holds himself out to the public as a cost accountant
in practice; or
(iii) renders
professional services or assistance in or about matters of principle or detail
relating to cost accounting procedure or the recording, presentation or
certification of costing facts or data; or
(iv) renders such other services as, in the opinion of the
Council, are or may be rendered by a cost accountant in practice,
and the words “to be in practice”, with their
grammatical variations and cognate expressions, shall be construed accordingly.
Explanation: A member of the Institute who is a whole‑time
salaried employee of any person shall not be deemed to be in practice within
the meaning of this sub-section.
THE
Incorporation of the Institute.
3. (1) All persons whose names are entered in
the Register at the commencement of this Act and all persons who may hereafter have their names
entered in the Register under the provisions of this Act, so long as they continue to have their names borne
on the said Register, are hereby constituted a body corporate by the name of the Institute of Cost and
Works Accountants of India, and all such persons shall be known as members of the Institute.
(2) The Institute shall have perpetual succession and a common
seal, and shall have power to acquire, hold and dispose of property, both
movable and immovable, and shall by its name sue or be sued.
Entry of names in the Register.
4. (1) Any of the following persons shall be
entitled to have his name entered in the Register, namely :—
(i) any person who was an associate or a
fellow of the dissolved company (other than an honorary associate or honorary
fellow thereof) immediately before the commencement of this Act, except any
such person who is not a permanent resident of India and is not at such
commencement practising as a cost accountant in
India;
(ii) any person who has passed such examination and completed
such training as may be prescribed for members of the Institute;
(iii) any person who, at the commencement of this Act, is engaged
in the practice of cost accountancy in
(iv) any person who has passed such other examination and
completed such other training without
Provided
that in the case of any person who is not permanently
residing in
(v) any
person domiciled in India, who at the commencement of this Act is studying for
any foreign examination and is at the same time undergoing training, whether
within or without India, or, who, having passed such examination, is at such
commencement undergoing training whether within or without India :
Provided
that such foreign examination and training
are recognised by the Central Government or the
Council in this behalf :
Provided further that
the person passes the examination and completes his training within five years
from the commencement of this Act.
(2) Every person belonging to the class mentioned in clause (i) of
sub-section (1) shall have his name entered in the Register without the payment
of any entrance fee.
[(3) Every person belonging to any of the classes
mentioned in clauses (ii), (iii), (iv) and (v) of sub-section (1) shall have
his name entered in the Register on application being made and granted in the
prescribed manner and on payment of such fees, as may be determined, by
notification, by the Council, which shall not exceed rupees three thousand:
Provided that the Council may with the prior approval of the Central
Government, determine the fee exceeding rupees three thousand, which shall not
in any case exceed rupees six thousand.]
(4) The Central Government shall take such steps as may be
necessary for the purpose of having the names of all persons belonging to the
class mentioned in clause (i) of sub-section (1) entered in the Register at the
commencement of this Act.
5. (1) The members of
the Institute shall be divided into two classes designated respectively as
associates and fellows.
(2) Any person other than a person to whom the provisions of
sub-section (3) apply shall, on his name being entered in the Register, be
deemed to have become an associate member of the Institute and so long as his
name remains so entered, shall be entitled to use the letters AICWA after his
name to indicate that he is an associate member of the Institute of Cost and
Works Accountants.
(3) Any person who was a fellow of the dissolved company and
who is entitled to have his name entered in the Register under clause (i) of
sub-section (1) of section 4, shall be entered in the Register as a fellow of
the Institute.
[(4) A member,
being an associate who has been in continuous practice in India for at least
five years, whether before or after the commencement of this Act, or whether
partly before and partly after the commencement of this Act, and a member who
has been an associate for a continuous period of not less than five years and
who possesses such qualifications as the Council may prescribe with a view to
ensuring that he has experience equivalent to the experience normally acquired
as a result of continuous practice for a period of five years as a cost
accountant shall, on payment of such fees, as may be determined, by
notification, by the Council, which shall not exceed rupees five thousand, and
on application made and granted in the prescribed manner, be entered in the
Register as a fellow of the Institute:
Provided that the Council may with the prior approval of the Central
Government, determine the fee exceeding rupees five thousand, which shall not
in any case exceed rupees ten thousand.
Explanation II.—In
computing the continuous period during which a person has been an associate of
the Institute, there shall be included any continuous period during which the
person has been an associate of the dissolved company immediately before he
became an associate of the Institute.]
(5) Any person whose name is entered in the Register as a fellow
of the institute and so long as his name remains so entered, shall be entitled
to use the letters FICWA after his name to indicate that he is a fellow of the
6. (1) No member of the Institute shall be
entitled to practise, whether in
[(2) Every such member shall make an
application in such form, and pay such annual fee, for his certificate as may
be determined, by notification, by the Council, which shall not exceed rupees
three thousand and such fee shall be payable on or before the 1st day of April
in each year:
Provided that the Council may with the prior approval of the Central
Government, determine the fee exceeding rupees three thousand, which shall not
in any case exceed rupees six thousand:
Provided further that if a member of the Institute, who was in practice
immediately before the commencement of this Act, has made within one month of
such commencement an application for the grant of certificate of practice, he
shall not be deemed to have contravened the provisions of sub-section (1) by
reason of his having practised during the period
between such commencement and the disposal of the application.]
[(3) The certificate
of practice obtained under sub-section (1) may be cancelled by the Council
under such circumstances as may be prescribed.]
Members to be known as cost
accountants.
7. Every member of the
Institute in practice shall, and any other member may, use the designation of a
cost accountant and no member using such designation shall use any other
description, whether in addition thereto or in substitution therefor :
Provided that nothing in this section shall be deemed to prohibit any such member
from adding any other description or letters to his name, if entitled thereto,
to indicate membership of such other Institute of accountancy, whether in India
or elsewhere, as may be recognised in this behalf by
the Council, or any other qualification that he may possess, or to prohibit a
firm, all the partners of which are members of the Institute and in practice,
from being known by its firm name as cost accountants.
8. Notwithstanding anything
contained in section 4, a person shall not be entitled to have his name entered
in, or borne on, the Register if he—
(i) has not
attained the age of twenty-one years at the time of his application for the
entry of his name in the Register; or
(ii) is of
unsound mind and stands so adjudged by a competent court; or
(iii) is an undischarged insolvent; or
(iv) 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;
or
(v) has
been convicted by a competent court whether within or without India, of an
offence involving moral turpitude and punishable with imprisonment or of an
offence, not of a technical nature, committed by him in his professional
capacity unless in respect of the offence committed he has either been granted
a pardon or, on an application made by him in this behalf, the Central
Government has, by an order in writing removed the disability; or
(vi) has been removed from membership of the Institute on being
found on inquiry to have been guilty of professional or other misconduct :
Provided 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.
COUNCIL OF THE INSTITUTE
Constitution of the Council of Institute.
9. (1) There shall be a
Council of the Institute for the management of the affairs of the Institute and
for discharging the functions
assigned to it by or under this Act.
[(2) The Council
shall be composed of the following persons, namely:—
(a) not more than fifteen persons elected by the members of the
Institute, from amongst the fellows of the Institute chosen in such manner and
from such regional constituencies as may be specified:
Provided
that a fellow of the Institute, who has
been found guilty of any professional or other misconduct, and whose name is
removed from the Register or has been awarded penalty of fine, shall not be
eligible to contest the election,—
(i) in case of misconduct falling under the First Schedule of
this Act, for a period of three years;
(ii) in case of
misconduct falling under the Second Schedule of this Act, for a period of six
years,
from the completion of the
period of removal of name from the Register or payment of fine, as the case may
be;
(b) not more than five persons nominated in the specified manner
by the Central Government.]
[(3) No person holding a post under the Central
Government or a State Government shall be eligible for election to the Council
under clause (a) of sub-section (2).
(4) No person who has been auditor of the
Institute shall be eligible for election to the Council under clause (a) of
sub-section (2) for a period of three years after he ceases to be an auditor.]
[Re-election
or re-nomination to Council.
10. A member of the
Council, elected or nominated under sub-section (2) of section 9, shall be
eligible for re-election or as the case may be,
re-nomination:
Provided that no member shall hold the office for more than two
consecutive terms:
Provided
further that a member of the Council,
who is or has been elected as President under sub-section (1) of section 12,
shall not be eligible for election or nomination as a member of the Council.]
[Settlement of
disputes regarding election.
10A. In
case of any dispute regarding any election under clause (a) of sub-section (2) of
section 9, the aggrieved person may make an application within thirty days from
the date of declaration of the result of election to the Secretary of the
Institute, who shall forward the same to the Central Government.
10B. (1) On receipt of any application under
section 10A, the Central Government shall, by notification, establish a Tribunal consisting of a
Presiding Officer and two other Members to decide such dispute and the decision of such Tribunal shall be
final.
(2) A person shall not be qualified for
appointment,—
(a) as a Presiding
Officer of the Tribunal unless he has been a member of the Indian Legal Service
and has held a post in Grade I of the service for at least three years;
(b) as a Member
unless he has been a member of the Council for at least one full term, and who
is not a sitting member of the Council or who has not been a candidate in the
election under dispute; or
(c) as a Member unless he holds the post of
a Joint Secretary to the Government of India or any other post under the
Central Government carrying a scale of pay which is not less than that of a
Joint Secretary to the Government of India.
(3)
The terms and conditions of service
of the Presiding Officer and Members of the Tribunal, their place of meetings
and allowances shall be such as may be specified.
(4) The expenses of the Tribunal shall be
borne by the Council.]
Nomination in default of election.
11. If the members of the institute fail to elect
any member under clause (a) of
sub-section (2) of section 9 from any of the regional constituencies that may
be specified under that clause, the Central Government may nominate any duly
qualified person from such constituency to fill the vacancy, and any person so
nominated shall be deemed to be a duly elected member of the Council.
12. (1)
The Council at its first meeting shall elect two of its members to be
respectively the President and the Vice-President
thereof, and so often as the office of the President or the Vice-President
becomes vacant, the Council
shall choose a person to be the President or the Vice-President, as the case
may be:
Provided that on the first constitution of the Council a member of the Council
nominated in this behalf by the Central Government shall discharge the
functions of the President, until such time as a President is elected under the
provisions of this sub-section.
(2) The President shall be the [Head] of the Council.
(3) The President or the Vice-President shall hold office for a
period of one year from the date on which he is chosen but so as not to extend
beyond his term of office as a member of the Council, and, subject to his being
a member of the Council at the relevant time, he shall be eligible for
re-election [under sub-section
(1)]:
Provided that the President [and
the Vice-President] of the Council at the time of the expiration
of its duration shall continue to hold office until a new Council is
constituted in accordance with the provisions of this Act.
Resignation of membership and casual vacancies.
13. (1) Any
member of the Council may at any time resign his membership by writing under
his hand addressed to the
President, and the seat of such member shall become vacant when such
resignation is notified in the
Official Gazette.
(2) A member of the Council shall be deemed to have vacated his
seat if he is declared by the Council to have been absent without sufficient
excuse from three consecutive meetings of the Council [or he has been found guilty of any
professional or other misconduct and awarded penalty of fine,] or
if his name is, for any cause, removed from the Register under the provisions
of section 20.
(3) A casual vacancy in the Council shall be filled by fresh
election from the constituency concerned or by nomination by the Central
Government, as the case may be, and the person elected or nominated to fill the
vacancy shall hold office until the dissolution of the Council
:
Provided that no election shall be held to fill a casual vacancy occurring within
[one year] prior
to the date of the expiration of the duration of the Council, but such a
vacancy may be filled by nomination by the Central Government after
consultation with the President of the Council.
(4) No act done by the Council shall be called in question on the
ground merely of the existence of any vacancy in, or defect in the constitution
of, the Council.
Duration and dissolution of Council.
14. (1) The duration of any Council constituted under this Act shall
be [four] years
from the date of its first meeting.
(2)
Notwithstanding the expiration of the duration of a Council (hereinafter
referred to as the former Council), the former Council shall continue to
exercise its functions under this Act until a new Council is constituted in
accordance with the provisions of this Act, and on such constitution, the
former Council shall stand dissolved.
15. (1) The Institute shall function under the overall
control, guidance and supervision of the Council and the duty of carrying out the provisions
of this Act shall be vested in the Council.
(2)
In particular, and without
prejudice to the generality of the foregoing powers, the duties of the Council
shall include—
(a) to approve academic courses and their contents;
(b) the prescribing of fees for the examination of candidates
for enrolment;
(c) the prescribing of qualifications for entry in the Register;
(d) the recognition of foreign qualifications and training for
the purposes of enrolment;
(e) the prescribing of guidelines for granting or refusal of
certificates of practice under this Act;
(f) the levy of fees from members, examinees and other persons;
(g) the regulation
and maintenance of the status and standard of professional qualifications of
members of the Institute;
(h) the carrying
out, by granting financial assistance to persons other than members of the
Council or in any other manner, of research in accountancy;
(i) to enable functioning of the Director (Discipline), the
Board of Discipline, the Disciplinary Committee and the Appellate Authority
constituted under the provisions of this Act;
(j) to enable functioning of the Quality Review Board;
(k) consideration of the recommendations of
the Quality Review Board made under clause (a) of section 29B, action taken
thereon with a report to the Central Government within a period of three
months, and their inclusion in the annual report; and
(l) to ensure the
functioning of the Institute in accordance with the provisions of this Act and
in performance of other statutory duties as may be entrusted to the Institute
from time to time.]
15A. The
functions of the Institute shall include—
(a) the examination of candidates for enrolment;
(b) the regulation of training of students;
(c) the maintenance and publication of a Register of persons
qualified to practice as Cost Accountants;
(d) collection of fees from members, examinees and other
persons;
(e) subject
to the orders of the appropriate authorities under this Act, the removal of
names from the Register and the
restoration to the Register of names which have been removed;
(f) the
maintenance of a library and publication of books and periodicals relating to
accountancy and allied subjects;
(g) the conduct of elections to the Council of the Institute;
and
(h) the granting or refusal of certificates of practice as per
guidelines issued by the Council.
Imparting
education by Universities and other bodies.
15B. (1) Subject to the provisions of this Act,
any University established by law or any body affiliated to the Institute, may
impart education on the
subjects
covered by the academic courses of the Institute.
(2) The Universities or bodies referred to
in sub-section (1) shall, while awarding degree, diploma or certificate or
bestowing any designation, ensure that the award or designation do not resemble
or is not identical to one awarded by the Institute.
(3)
Nothing contained in this section
shall enable a University or a body to adopt a name or nomenclature which is in
any way similar to that of the Institute.]
[Officers and employees, salary,
allowances, etc.
16. (1) For the
efficient performance of its duties, the Council shall—
(a) appoint a Secretary of the Council to perform such duties as
may be prescribed;
(b) appoint a
Director (Discipline) to perform such functions as assigned to him under this
Act and the rules and regulations framed thereunder;
(c) designate an
officer of the Council or the Institute to carry out the administrative
functions of the Institute as its chief executive.
(2) The Council may also —
(a) appoint such
other officers and employees to the Council and the Institute as it considers
necessary;
(b) require and
take from the Secretary or from any other officer or employee of the Council
and the Institute such security for the due performance of his duties, as the
Council considers necessary;
(c) prescribe the
salaries, fees, allowances of the officers and employees of the Council and the
Institute and their terms and conditions of service;
(d) with the
previous sanction of the Central Government, fix the allowances of the
President, Vice-President and other members of the Council and members of its
Committees.
(3) The Secretary of the Council shall be
entitled to participate in the meetings of the Council but shall not be
entitled to vote thereat.]
17. (1) The Council shall constitute from amongst
its members the following Standing Committees, namely :—
(i) an Executive Committee;
(ii) a [Finance] Committee; and
(iii) an Examination
Committee.
(2) The Council may also form a Training
and Educational Facilities Committee and such other Committees from amongst its
members as it deems necessary for the purpose of carrying out the provisions of
this Act.
[(3) Each of the Standing Committees shall
consist of the President and the Vice-President ex officio, and minimum of
three and maximum of five members to be elected by the Council from amongst its
members.]
(4) [***]
(5) [***]
(6) Notwithstanding anything contained in this section, any
Committee formed under sub-section (2), may, with the sanction of the Council, co-opt
such other members of the Institute not exceeding [one-third] of the total
membership of the Committee as the Committee thinks fit, and any member so
co-opted shall be entitled to exercise all the rights of a member of the
Committee.
(7) The President shall be the Chairman of every Committee of
which he is a member, and in his absence, the Vice-President, if he is a member
of the Committee, shall be the Chairman.
(8) The Standing Committees and other Committees formed under
this section shall exercise such functions and be subject to such conditions in
the exercise thereof as may be prescribed.
18. (1)
There shall be established a fund under the management and control of the
Council into which shall be paid all moneys
received by the
Council and out of
which shall be met all expenses and liabilities properly incurred by the
Council.
(2) The Council may invest any money for the time being standing
to the credit of the fund in any Government security or in any other security
approved by the Central Government.
[(3) The Council shall keep proper accounts
of the fund distinguishing capital from revenue in the manner prescribed.
(4)
The Council shall prepare in the
manner prescribed and approve, prior to the start of the financial year, an
annual financial statement (the budget) indicating all its anticipated revenues
as well as all proposed expenditures for the forthcoming year.
(5)
The annual accounts of the Council
shall be prepared in such manner as may be prescribed and be subject to audit
by a chartered accountant in practice to be appointed annually by the Council :
Provided that no member of the Council or a person who has been a
member of the Council during the last four years or a person who is in
partnership with such member shall be eligible for appointment as an auditor
under this sub-section:
Provided further that, in the event it is brought to the notice of the
Council that the accounts of the Council do not represent a true and fair view
of its finances, then, the Council may itself cause a special audit to be conducted :
Provided also that if such information, that the accounts of the Council
do not represent a true and fair view of its finances, is sent to the Council
by the Central Government, then, the Council may, wherever appropriate cause a
special audit or take such other action as it considers necessary and shall
furnish an action taken report on it to the Central Government.]
[(5A) As soon as may be practicable at the end of each
year, the Council shall circulate the audited accounts to its members at least
fifteen days in advance and consider and approve these accounts in a special
meeting convened for the purpose.
(5B) The Council shall cause to be published in
the Gazette of India not later than the 30th day of September of the year next
following, a copy of the audited accounts and the Report of the Council for
that year duly approved by the Council and copies of the said accounts and
Report shall be forwarded to the Central Government and to all the members of
the Institute.]
(6) The Council may borrow from a scheduled bank as defined in the
Reserve Bank of India Act, 1934 (2 of 1934), or from the Central Government—
(a) any money required
for meeting its liabilities on capital account on the security of the fund or
on the security of any other assets for the time being belonging to it; or
(b) for
the purpose of meeting current liabilities pending the receipt of income by way
of temporary loan or overdraft.
REGISTER
OF MEMBERS
19. (1) The
Council shall maintain in the prescribed manner a Register of the members of
the Institute.
(2) The
Register shall include the following particulars about every member of the
Institute, namely:—
(a) his full name, date of birth, domicile, residential and
professional addresses;
(b) the date on
which his name is entered in the Register;
(c) his
qualifications;
(d) whether he
holds a certificate of practice; and
(e) any other
particulars which may be prescribed.
(3) The Council shall cause
to be published in such manner as may be prescribed a list of members of the
Institute as on the 1st day of April of each year, and shall, if requested to
do so by any such member, send him a copy of such list [on payment of such amount as may be
prescribed].
[(4) Every member of the Institute shall, on his
name being entered in the Register, pay such annual membership fee as may be
determined, by notification, by the Council, which shall not exceed rupees five
thousand:
Provided that the Council may with the prior approval of the Central
Government, determine the fee exceeding rupees five thousand which shall not in
any case exceed rupees ten thousand.]
20. (1) The
Council may remove from the Register the name of any member of the Institute,—
(a) who is dead; or
(b) from whom a
request has been received to that effect; or
(c) who has not
paid any prescribed fee required to be paid by him; or
(d) who is found to
have been subject at the time when his name was entered in the Register, or who at any time thereafter has become
subject, to any of the disabilities mentioned in section 8, or who for any other reason has ceased
to be entitled to have his name borne on the Register.
(2) The Council shall remove from the Register the name of any
member in respect of whom an order has been passed under this Act removing him
from membership of the Institute.
[(3) If the name
of any member has been removed from the Register under clause (c) of
sub-section (1), on receipt of an application, his name may be entered again in
the Register on payment of the arrears of annual fee and entrance fee along
with such additional fee, as may be determined, by notification, by the Council
which shall not exceed rupees two thousand:
Provided that the Council may with the prior approval of the Central
Government, determine the fee exceeding rupees two thousand which shall not in
any case exceed rupees four thousand.]
MISCONDUCT
21. (1) The Council
shall, by notification, establish a Disciplinary Directorate headed by an
officer of the Institute designated as Director (Discipline)
and such other employees for making
investigations in respect of any information or complaint received by it.
(2)
On receipt of any information or
complaint along with the prescribed fee, the Director (Discipline) shall arrive
at a prima facie opinion on the occurrence of the alleged misconduct.
(3)
Where the Director (Discipline) is
of the opinion that a member is guilty of any professional or other misconduct
mentioned in the First Schedule, he shall place the matter before the Board of
Discipline and where the Director (Discipline) is of the opinion that a member
is guilty of any professional or other misconduct mentioned in the Second
Schedule or in both the Schedules, he shall place the matter before the
Disciplinary Committee.
(4)
In order to make investigations
under the provisions of this Act, the Disciplinary Directorate shall follow
such procedure as may be specified.
(5) Where a complainant withdraws the
complaint, the Director (Discipline) shall place such withdrawal before the
Board of Discipline or as the case may be, the Disciplinary Committee, and the
said Board or Committee may, if it is of the view that the circumstances so
warrant, permit the withdrawal at any stage.]
21A. (1) The Council
shall constitute a Board of Discipline consisting of—
(a) a person with
experience in law and having knowledge of disciplinary matters and the
profession, to be its Presiding Officer;
(b) two members one
of whom shall be a member of the Council elected by the Council and the other
member shall be the person designated under clause (c) of sub-section (1) of
section 16;
(c) the Director (Discipline) shall function as the Secretary of
the Board.
(2) The Board of Discipline shall follow
summary disposal procedure in dealing with all the cases before it.
(3)
Where the Board of Discipline is of
the opinion that a member is guilty of a professional or other misconduct
mentioned in the First Schedule, it shall afford to the member an opportunity
of being heard before making any order against him and may thereafter take any
one or more of the following actions, namely:—
(a) reprimand the member;
(b) remove the name of the member from the Register up to a
period of three months;
(c) impose such fine as it may think fit which may extend to
rupees one lakh.
(4)
The Director (Discipline) shall
submit before the Board of Discipline all information and complaints where he
is of the opinion that there is no prima facie case and the Board of Discipline
may, if it agrees with the opinion of the Director (Discipline), close the
matter or in case of disagreement, may advise the Director (Discipline) to
further investigate the matter.
21B.
(1) The
Council shall constitute a Disciplinary Committee consisting of the President
or the Vice-President of the Council as the Presiding Officer and two members
to be elected from amongst the members of the Council and two members to be
nominated by the Central Government from amongst the persons of eminence having
experience in the field of law, economics, business, finance or accountancy:
Provided that the Council may constitute more Disciplinary
Committees as and when it considers necessary.
(2)
The Disciplinary Committee while
considering the cases placed before it, shall follow
such procedure as may be specified.
(3)
Where the Disciplinary Committee is
of the opinion that a member is guilty of a professional or other misconduct
mentioned in the Second Schedule or both the First Schedule and the Second
Schedule, it shall afford to the member an opportunity of being heard before
making any order against him and may thereafter take any one or more of the
following actions, namely:—
(a) reprimand the member;
(b) remove the name
of the member from the Register permanently or for such period, as it thinks
fit;
(c) impose such fine as it may think fit, which may extend to
rupees five lakhs.
(4)
The allowances payable to the members
nominated by the Central Government shall be such as may be specified.
Authority,
Disciplinary Committee, Board of Discipline and Director (Discipline) to have
powers of civil court.
21C. For the purposes of
an inquiry under the provisions of this Act, the Authority, the Disciplinary
Committee, Board of Discipline and the Director (Discipline) shall have the
same powers as are vested in a civil court under the Code of Civil Procedure,
1908 (5 of 1908), in respect of the following matters, namely:—
(a) summoning and enforcing the attendance of any person and
examining him on oath;
(b) the discovery and production of any document; and
(c) receiving evidence on affidavit.
Explanation.—For the
purposes of sections 21, 21A, 21B, 21C and 22, “member of the Institute”
includes a person who was a member of the Institute on the date of the alleged
misconduct although he has ceased to be a member of the Institute at the time
of the inquiry.
21D. All
complaints pending before the Council or any inquiry initiated by the
Disciplinary Committee or any reference or appeal made to a High Court prior to
the commencement of the Cost and Works Accountants (Amendment) Act, 2006 shall
continue to be governed by the provisions of this Act, as if this Act had not
been amended by the Cost and Works Accountants (Amendment) Act, 2006.]
[Professional or other misconduct defined.
22. For the purposes
of this Act, the expression “professional or other misconduct” shall be deemed
to include any act or omission provided in any of the Schedules but nothing in
this section shall be construed to limit or abridge in any way the power
conferred or duty cast on the Director (Discipline) under sub-section (1) of
section 21 to inquire into the conduct of any member of the Institute under any
other circumstances.]
[Constitution of Appellate Authority.
22A. The Appellate
Authority constituted under sub-section (1) of section 22A of the Chartered
Accountants Act, 1949 (38 of 1949), shall be deemed to be the Appellate Authority
for the purposes of this Act subject to the modification that for clause (b) of
said sub-section (1), the following clause had been substituted, namely :—
“(b) the Central Government shall, by
notification appoint two part-time members from amongst the persons who have
been members of the Council of the Institute of Cost and Works Accountants of
India for at least one full term and who is not a sitting member of the
Council;”
Term of office
of members of Authority.
22B. A
person appointed as a member shall hold office for a term of three years from
the date on which he enters upon his office or until he attains the age of
sixty-two years, whichever is earlier.
Procedure,
etc., of Authority.
22C. The
provisions of section 22C, section 22D and section 22F of the Chartered
Accountants Act, 1949 (38 of 1949) shall apply to the Authority in relation to
allowances and terms and conditions of service of its Chairperson and members
and in the discharge of its functions under this Act as they apply to it in the
discharge of its functions under the Chartered Accountants Act, 1949.
Officers and other Staff of Authority.
22D. (1) The Council shall
make available to the Authority such officers and other staff members as may be
necessary for the efficient performance of
the functions of the Authority.
(2) The salaries and allowances and
conditions of service of the officers and other staff members of the Authority
shall be such as may be prescribed.
22E. (1) Any member of the Institute aggrieved by any order of the
Board of Discipline or the Disciplinary Committee imposing on him any of the
penalties referred to in sub-section (3) of
section 21A and sub- section (3) of
section 21B, may within ninety days from the date on which
the order is communicated to him, prefer an
appeal to the Authority:
Provided that the Director (Discipline) may also appeal against the
decision of the Board of Discipline or the Disciplinary Committee to the
Authority if so authorised by the Council, within ninety
days:
Provided
further that the Authority may
entertain any such appeal after the expiry of the said period of ninety days,
if it is satisfied that there was sufficient cause for not filing the appeal in
time.
(2) The Authority may, after calling for
the records of any case, revise any order made by the Board of Discipline or
the Disciplinary Committee under sub-section (3) of section 21A and sub-section
(3) of section 21B and may —
(a) confirm, modify or set aside the order;
(b) impose any penalty or set aside, reduce, or enhance the
penalty imposed by the order;
(c) remit the case to the Board of
Discipline or Disciplinary Committee for such further enquiry as the Authority
considers proper in the circumstances of the case; or
(d) pass such other order as the Authority thinks fit:
Provided that the Authority shall give an opportunity of being
heard to the parties concerned before passing any order.]
REGIONAL
COUNCILS
Constitution and functions of Regional Councils.
23. (1) For the purpose of advising and assisting
it on matters concerning its functions, the Council may constitute such
Regional Councils as and when it deems fit for one or more of the regional
constituencies that may be specified by the Central Government under clause (a) of sub-section (2) of section 9.
(2) The Regional Councils shall be constituted in such manner and
exercise such functions as may be prescribed.
PENALTIES
Penalty for falsely claiming to be a member, etc.
24. Any person who,—
(i) not being
a member of the Institute—
(a) represents that he is a member of the Institute; or
(b) uses the designation cost accountant; or
(ii) being a
member of the Institute, but not having a certificate of practice, represents
that he is in practice or practices as a cost accountant,
shall be punishable on first conviction with fine
which may extend to one thousand rupees, and on any subsequent conviction with
imprisonment which may extend to six months, or with fine which may extend to
five thousand rupees, or with both.
Penalty for using name of the Council, awarding degrees of
cost accountancy, etc.
25. (1) Save as otherwise provided in this Act, no
person shall,—
(i) use a name or
a common seal which is identical with the name or the common seal of the
Institute or so nearly resembles it as to deceive or as is likely to deceive
the public;
(ii) award
any degree, diploma or certificate or bestow any designation which indicates or
purports to indicate the position or attainment of any qualification or
competence in cost accountancy similar to that of a member of the Institute; or
(iii) seek to regulate
in any manner whatsoever the profession of cost and works accountants.
(2) Any person contravening the provisions of sub-section (1)
shall, without prejudice to any other proceedings which may be taken against
him, be punishable on first conviction with fine which may extend to one
thousand rupees, and on any subsequent conviction with imprisonment which may
extend to six months, or with fine which may extend to five thousand rupees, or
with both.
(3) [***]
(4)
If the Central Government is satisfied that any diploma or certificate or any
designation granted or conferred by any person other than the Institute, which
purports to be a qualification in cost accountancy but which, in the opinion of
the Central Government, falls short of the standard of qualifications
prescribed for cost accountants and does not in fact indicate or purport to
indicate the position or attainment of any qualification or competence in cost
accountancy similar to that of a member of the Institute, it may, by
notification in the Official Gazette and subject to such conditions as it may
think fit to impose, declare that this section shall not apply to such diploma
or certificate or designation.
Companies not to engage in cost accountancy.
26. (1)
No company, whether incorporated in
(2) Any contravention of the provisions of sub-section (1) shall
be punishable on first conviction with fine which may extend to one thousand
rupees, and on any subsequent conviction to five thousand rupees.
Unqualified
persons not to sign documents.
27. (1) No person other than a member of the
Institute shall sign any document on behalf of a cost accountant in practice or a firm of such cost
accountants in his or its professional capacity.
[(2) Any person who
contravenes the provisions of sub-section (1) shall, without prejudice to any
other proceedings which may be taken against him, be punishable on first
conviction with a fine not less than five thousand rupees but which may extend
to one lakh rupees, and in the event of a second or
subsequent conviction with imprisonment for a term which may extend to one year
or with a fine not less than ten thousand rupees but which may extend to two lakh rupees or with both.]
28. (1) If
the person committing an offence under this Act is a company, the company as
well as every person in-charge of, and
responsible to, the company for the conduct of its business at the time of the commission of the offence shall be deemed
to be guilty of the offence and shall be liable to be proceeded against and punished accordingly :
Provided that nothing contained in this sub-section shall render any such person
liable to any punishment if he proves that the offence was committed without
his knowledge or that he exercised all due diligence to prevent the commission
of such offence.
(2) Notwithstanding anything contained in sub-section (1), where
an offence under this Act has been committed by a company and it is proved that
the offence has been committed with the consent or connivance of, or that the
commission of the offence is attributable to any neglect on the part of, any
director, manager, secretary or other officer of the company, such director,
manager, secretary or other officer shall also be deemed to be guilty of that
offence and shall be liable to be proceeded against and punished accordingly.
Explanation: For the purposes of this section,—
(a) “company”,
with respect to an offence under section 24, section 25 or section 27, means
any body corporate and includes a firm or other association of individuals; and
with respect to an offence under section 26 means a body corporate; and
(b) “director”, in relation to a firm, means a partner in the
firm.
29. No person shall be prosecuted under this Act
except on a complaint made by or under the order of the Council or of the
Central Government.
QUALITY
REVIEW BOARD
Establishment
of Quality Review Board.
29A. (1) The Central
Government shall, by notification, constitute a Quality Review Board consisting
of a Chairperson and four other members.
(2)
The Chairperson and members of the
Board shall be appointed from amongst the persons of eminence having experience
in the field of law, economics, business, finance or accountancy.
(3) Two members of the Board shall be
nominated by the Council and other two members shall be nominated by the
Central Government.
29B. The Board shall
perform the following functions, namely:—
(a) to make
recommendations to the Council with regard to the quality of services provided
by the members of the Institute;
(b) to review
the quality of services provided by the members of the Institute including cost
audit services; and
(c) to guide
the members of the Institute to improve the quality of services and adherence
to the various statutory and other regulatory requirements.
29C. The
Board shall meet at such time and place and follow in its meetings such procedure
as may be specified.
Terms and
conditions of service of Chairperson and members of Board and its expenditure.
29D. (1) The terms and
conditions of service of the Chairperson and the members of the Board, and
their allowances shall be such as may be
specified.
(2) The expenditure of the Board shall be
borne by the Council.]
DISSOLUTION
OF THE
ACCOUNTANTS REGISTERED UNDER THE
COMPANIES ACT, 1956 (1 OF 1956)
Dissolution
of the Institute of Cost and Works Accountants registered under the Companies
Act, 1956.
30. On the commencement of this Act,—
(a) the company known as the Institute of
Cost and Works Accountants registered under the Companies Act, 1956 (1 of
1956), shall be dissolved and thereafter no person shall make, assert or take
any claims, demands or proceedings against the dissolved company or against any
officer thereof in his capacity as such officer except insofar as may be
necessary, for enforcing the provisions of this Act;
(b) the right of
every member to or in respect of the dissolved company shall be extinguished,
and thereafter no member of that company shall make, assert or take any claims
or demands or proceedings in respect of that company except as provided in this
Act.
Transfer of assets and liabilities of the dissolved company
to the Institute.
31. (1) On the commencement of this Act, there shall be transferred
to and vested in the Institute all the assets and
liabilities of the dissolved
company.
(2) The assets of the dissolved company shall be deemed to include
all rights and powers, and all property, whether movable or immovable of the
company, including, in particular, cash balances, reserve funds, investments,
deposits and all other interests and rights in or arising out of such property
as may be in the possession of the dissolved company and all books of accounts
or documents of the dissolved company; and the liabilities shall be deemed to
include all debts, liabilities and obligations of whatever kind then existing
of that company.
(3) All contracts, debts, bonds, agreements and other instruments
of whatever nature to which the dissolved company is a party, subsisting or
having effect immediately before the commencement of this Act, shall be of as
full force and effect against or in favour of the
Institute, as the case may be, and may be enforced as fully and effectively as
if instead of the dissolved company, the Institute had been a party thereto.
(4) If, on the commencement of this Act, any suit, appeal or other
legal proceeding of whatever nature by or against the dissolved company is
pending, the same shall not abate, be discontinued or be in any way
prejudicially affected by reason of the transfer to the Institute of the assets
and liabilities of the dissolved company or of anything contained in this Act,
but the suit, appeal or other proceeding may be continued, prosecuted and
enforced by or against the Institute, in the same manner and to the same extent
as it would or may be continued, prosecuted and enforced by or against the
dissolved company if this Act had not been passed.
Provisions
respecting employees of the dissolved company.
32. (1) Every
person employed in the dissolved company prior to the 1st day of September,
1958, and still in its employment immediately
before the commencement of this Act shall, as from such commencement, become an
employee of the Institute, shall hold his office or service therein by the same
tenure and upon the same terms and
conditions and with the same rights and privileges as to pension and gratuity as he would have held the same under the
dissolved company if this Act had not been passed, and shall continue to do so
unless and until his employment in the Institute is terminated or until his remuneration,
terms and conditions of employment are duly altered by the Institute.
(2) Notwithstanding anything contained in the Industrial Disputes
Act, 1947 (14 of 1947), or in any other law for the time
being in force, the transfer of the services of any employee of the dissolved
company to the Institute shall not entitle any such employee to any
compensation under that Act or other law, and no such claim shall be
entertained by any court, tribunal or other authority.
MISCELLANEOUS
33. [Omitted
by the Cost and Works Accountants (Amendment) Act, 2006, with effect from a
date yet to be notified.]
Alteration
in the Register and cancellation of certificate.
34. (1) Where an order is made under this Act reprimanding a member
a record of the punishment shall be entered
against his name in the Register.
(2) Where the name of any member is removed, the certificate of
practice granted to him under this Act shall be recalled and cancelled.
Directions
of the Central Government.
35. (1) The
Central Government may from time to time issue such directions to the Council
as in the opinion of the Central
Government are conducive to the fulfilment of the
objects of this Act and in the discharge of its functions, the Council shall be
bound to carry out any such directions.
(2)
Directions issued under sub-section (1) may include directions to the Council
to make any regulations or to amend or revoke any regulations already made.
(3) If, in the opinion of the Central Government the Council has
persistently made default in giving effect to the directions issued under this
section, the Central Government may, after giving an opportunity to the Council
to state its case, by order, dissolve the Council, whereafter
a new Council shall be constituted in accordance with the provisions of this
Act with effect from such date as may be specified by the Central Government.
(4) Where the Central Government passes an order under sub-section
(3) dissolving the Council, it may, pending the constitution of a new Council
in accordance with the provisions of this Act, authorise
any person or body of persons to take over the management of the affairs of the
Institute and to exercise such functions as may be specified in this behalf by
the Central Government.
[Protection of
action taken in good faith.
36. No suit,
prosecution or other legal proceeding shall lie against the Central Government
or the Council or the Authority or the Disciplinary Committee or the Tribunal
or the Board or the Board of Discipline or the Disciplinary Directorate or any
officer of that Government, Council, Authority, Disciplinary Committee,
Tribunal, Board, Board of Discipline or the Disciplinary Directorate, for
anything which is in good faith done or intended to be done under this Act or
any rule, regulation, notification, direction or order made thereunder.]
[Members,
etc., to be public servants.
36A. The Chairperson,
Presiding Officer, members and other officers and employees of the Authority,
Disciplinary Committee, Tribunal, Board, Board of Discipline or the Disciplinary
Directorate shall be deemed to be public servants within the meaning of section
21 of the Indian Penal Code (45 of 1860).]
Maintenance
of branch offices.
37. (1) Where
a cost accountant in practice or a firm of such cost accountants has more than one
office in
Provided that the Council may in suitable cases exempt
any cost accountant in practice or firm of such cost accountants from the operation of this sub-section.
(2) Every cost accountant in practice or firm of such cost
accountants maintaining more than one office shall send to the Council a list
of offices and the persons in charge thereof and shall keep the Council
informed of any changes in relation thereto.
38. (1) Where
any country, specified by the Central Government in this behalf by notification
in the Official Gazette, prevents persons of Indian domicile from becoming
members of any institution similar to the Institute established under this Act
or from practising the profession of cost accountancy
or subjects them to unfair discrimination in that country, no subject of any
such country shall be entitled to become a member of the Institute or practise the profession of cost accountancy, in India.
(2) Subject to the provisions of sub-section (1), the Council may
prescribe the conditions, if any, subject to which foreign qualifications
relating to cost accountancy shall be recognized for the purposes of entry in
the Register.
[Power of
Central Government to make rules.
38A. (1) The Central
Government may, by notification, make rules to carry out the provisions of this
Act.
(2)
In particular, and without
prejudice to the generality of the foregoing powers, such rules may provide for
all or any of the following matters, namely:—
(a) the manner of
election and nomination in respect of members to the Council under sub-section
(2) of section 9;
(b) the terms and
conditions of service of the Presiding Officer and Members of the Tribunal,
place of meetings and allowances to be paid to them under sub-section (3) of
section 10B;
(c) the procedure of investigation under sub-section (4) of
section 21;
(d) the procedure
while considering the cases by the Disciplinary Committee under sub-section (2)
and fixation of allowances of the nominated members under sub-section (4) of
section 21B;
(e) the procedure to be followed by the Board in its meetings
under section 29C; and
(f) the terms and conditions of service of
the Chairperson and members of the Board under sub-section (1) of section 29D.]
39. (1) The Council may, by notification in the
Gazette of India, make regulations for the purpose of carrying out the objects
of this Act [***].
(2)
In particular, and without prejudice to the generality of the foregoing power,
such regulations may provide for all or any of the following matters, namely:—
(a) the standard
and conduct of examinations under this Act;
(b) the qualifications for the entry of the name of any person
in the Register as a member of the Institute;
(c) the
qualification required for the purposes of sub‑section (4) of section 5;
(d) the conditions under which any examination or training may
be treated as equivalent to the examination or training prescribed for members
of the Institute;
(e) the conditions
under which any foreign qualification may be recognised;
(f) the manner in which and the conditions subject to which
applications for entry in the Register may be made;
(g) the fees payable for membership of the Institute and the
annual fees payable by associates and fellows of the Institute in respect of
their certificates;
(h) the manner in
which elections to [***] the Regional Councils may be held;
(i) the particulars to be entered in the Register;
(j) the functions
of Regional Councils;
(k) the regulation and maintenance of the status and standard of
professional qualifications of members of the Institute;
(l) the carrying
out of research in accountancy;
(m) the maintenance of libraries and publication of books and
periodicals relating to cost accountancy and allied subjects;
(n) the management
of the property of the Council and the maintenance and audit of its accounts;
(o) the summoning and holding the meetings of the Council and
committees thereof, the times and places of such meetings, the procedure to be
followed thereat and the number of members necessary to form a quorum;
(p) the manner in
which the annual list of members of the Institute shall be published;
(q) the powers,
duties and functions of the President and the Vice-President of the Council;
(r) the functions of the Standing and other committees and the
conditions subject to which such functions shall be discharged;
(s) the terms of office, and the powers, duties and functions of
the Secretary and other employees of the Council;
(t) [***]
(u) the terms and conditions of service of persons who have
become employees of the Institute under section 32 of this Act;
(v) the
registration and training of students and the fees to be charged therefor, and
(w) any other matter
which is required to be, or may be, prescribed under this Act.
(3) All regulations made by the Council under this Act shall be
subject to the condition of previous publication and to the approval of the
Central Government.
(4) Notwithstanding anything contained in sub-sections (1) and
(2), the Central Government may frame the first regulations for the purposes
mentioned in this section, and such regulations shall be deemed to have been
made by the Council, and shall remain in force until they are amended, altered
or revoked by the Council.
(5) [***]
[Rules,
regulations and notifications to be laid before Parliament.
40. Every rule and
every regulation made and every notification issued under this Act shall be
laid, as soon as may be after it is made or issued, before each House of
Parliament, while it is in session, for a total period of thirty days which may
be comprised in one session or in two or more successive sessions, and if,
before the expiry of the session immediately following the session or the
successive sessions aforesaid, both Houses agree in making any modification in
the rule, regulation or notification, or both Houses agree that the rule,
regulation or notification should not be made or issued, the rule, regulation
or notification shall thereafter have effect only in such modified form or be
of no effect, as the case may be; so, however, that any such modification or
annulment shall be without prejudice to the validity of anything previously
done under that rule, regulation or notification.]
[See sections 21(3), 21A(3) and 22]
PART I
Professional misconduct in relation to cost
accountants in practice
A cost accountant in
practice shall be deemed to be guilty of professional misconduct, if he—
(1) allows any
person to practice in his name as a cost accountant unless such person is also
a cost accountant in practice and is in partnership with or employed by him;
(2) pays or allows or agrees to pay or
allow, directly or indirectly, any share, commission or brokerage in the fees
or profits of his professional business, to any person other than a member of
the Institute or a partner or a retired partner or the legal representative of
a deceased partner, or a member of any other professional body or with such
other persons having such qualifications as may be prescribed, for the purpose
of rendering such professional services from time to time in or outside India.
Explanation.—In
this item, “partner” includes a person residing outside India with whom a cost
accountant in practice has entered into partnership which is not in
contravention of item (4) of this Part;
(3) accepts or
agrees to accept any part of the profits of the professional work of a person
who is not a member of the Institute:
Provided that nothing herein contained shall be construed as
prohibiting a member from entering into profit sharing or other similar
arrangements, including receiving any share, commission or brokerage in the
fees, with a member of such professional body or other person having
qualifications, as is referred to in item (2) of this Part;
(4) enters into partnership, in or
outside India, with any person other than a cost accountant in practice or such
other person who is a member of any other professional body having such
qualifications as may be prescribed, including a resident who but for his
residence abroad would be entitled to be registered as a member under clause
(iv) of sub-section (1) of section 4 or whose qualifications are recognised by the Central Government or the Council for the
purpose of permitting such partnerships;
(5) secures,
either through the services of a person who is not an employee of such cost
accountant or who is not his partner or by means which are not open to a cost
accountant, any professional business:
Provided
that nothing herein contained shall be
construed as prohibiting any arrangement permitted in terms of items (2), (3)
and (4) of this Part;
(6) solicits
clients or professional work, either directly or indirectly, by circular,
advertisement, personal communication or interview or by any other means:
Provided that nothing herein
contained shall be construed as preventing or prohibiting—
(i) any cost accountant from applying or requesting for or inviting
or securing professional work from another cost accountant in practice;
(ii) a member from responding to tenders or enquiries issued by
various users of professional services or organisations
from time to time and securing professional work as a consequence;
(7) advertises his professional
attainments or services, or uses any designation or expressions other than cost
accountant on professional documents, visiting cards, letter heads or sign
boards, unless it be a degree of a University established by law in India or recognised by the Central Government or a title indicating
membership of the Institute of Cost Accountants of India or of any other
institution that has been recognised by the Central
Government or may be recognised by the Council:
Provided
that a member in practice may advertise
through a write up, setting out the services provided by him or his firm and
particulars of his firm subject to such guidelines as may be issued by the
Council;
(8) accepts a
position as cost accountant previously held by another cost accountant in
practice without first communicating with him in writing;
(9) charges or offers to charge, accepts
or offers to accept in respect of any professional employment, fees which are
based on a percentage of profits or which are contingent upon the findings or
results of such employment, except as permitted under any regulation made under
this Act;
(10) engages in
any business or occupation other than the profession of cost accountant unless
permitted by the Council so to engage:
Provided
that nothing contained herein shall
disentitle a cost accountant from being a director of a company (not being a
managing director or a whole-time director) unless he or any of his partners is
interested in such company as accountant;
(11) allows a person not being a member of
the Institute in practice, or a member not being his partner to sign on his
behalf or on behalf of his firm, any cost or pricing statements or any other
statements relating thereto.
PART II
Professional misconduct in relation to members
of
the Institute in service
A member of the
Institute (other than a member in practice) shall be deemed to be guilty of
professional misconduct, if he being an employee of any company, firm or
person—
(1) pays or
allows or agrees to pay, directly or indirectly, to any person any share in the
emoluments of the employment undertaken by him;
(2) accepts or agrees to accept any part
of fees, profit or gains from a lawyer, a cost accountant or broker engaged by
such company, firm or person or agent or customer of such company, firm or
person by way of commission or gratification.
PART III
Professional misconduct in relation to members
of
the Institute generally
A member of the
Institute, whether in practice or not, shall be deemed to be guilty of
professional misconduct, if he—
(1) not being a
fellow of the Institute acts as a fellow of the Institute;
(2) does not supply the information called
for, or does not comply with the requirements asked for by the Institute,
Council or any of its Committees, Director (Discipline), Board of Discipline,
Disciplinary Committee, Quality Review Board or the Appellate Authority;
(3) while inviting professional work
from another cost accountant or while responding to tenders or enquiries or
while advertising through a write up, or anything as provided for in items (6)
and (7) of Part I of this Schedule, gives information knowing it to be false.
PART IV
Other misconduct in relation to members of
the Institute generally
A member of the
institute, whether in practice or not, shall be deemed to be guilty of other
misconduct, if—
(1) he is held
guilty by any civil or criminal court for an offence which is punishable with
imprisonment for a term not exceeding six months;
(2) in the
opinion of the Council he brings disrepute to the profession or the institute
as a result of his action whether or not related to his professional work.
[See sections
21(3), 21B(3) and 22]
PART I
Professional misconduct in relation to
cost accountants in practice
A cost accountant in
practice shall be deemed to be guilty of professional misconduct, if he —
(1) discloses information acquired in
the course of his professional engagement to any person other than his client
so engaging him, without the consent of his client, or otherwise than as
required by any law for the time being in force;
(2) certifies
or submits in his name, or in the name of his firm, a report of an examination
of cost accounting and related statements unless the examination of such
statements has been made by him or by a partner or an employee in his firm or
by another cost accountant in practice;
(3) permits his name or the name of his
firm to be used in connection with an estimate of cost or earnings contingent
upon future transactions in a manner which may lead to the belief that he
vouches for the accuracy of the forecast;
(4) expresses
his opinion on cost or pricing statements of any business or enterprise in
which he, his firm or a partner in his firm has a substantial interest;
(5) fails to disclose a material fact
known to him in a cost or pricing statement, which is not disclosed in a cost
or pricing statement but disclosure of which is necessary in making such
statement where he is concerned with such statement in a professional capacity;
(6) fails to report a material mis-statement known to him to appear in a cost or pricing
statement with which he is concerned in a professional capacity;
(7) does not exercise due diligence, or is grossly negligent in
the conduct of his professional duties;
(8) fails to
obtain sufficient information which is necessary for expression of an opinion
or its exceptions are sufficiently material to negate the expression of an
opinion;
(9) fails to
invite attention to any material departure from the generally accepted
procedure of costing and pricing applicable to the circumstances;
(10) fails to keep
moneys of his client other than fees or remuneration or money meant to be
expended in a separate banking account or to use such moneys for purposes for
which they are intended within a reasonable time.
PART II
Professional misconduct in relation to members
of
the Institute generally
A member of the
Institute, whether in practice or not, shall be deemed to be guilty of
professional misconduct, if he—
(1) contravenes any of the provisions of
this Act or the regulations made there-under or any guidelines issued by the
Council;
(2) being an
employee of any company, firm or person, discloses confidential information
acquired in the course of his employment, except as and when required by any
law for the time being in force or except as permitted by the employer;
(3) includes in any information,
statement, return or form to be submitted to the Institute, Council or any of
its Committees, Director (Discipline), Board of Discipline, Disciplinary
Committee, Quality Review Board or the Appellate Authority any particulars
knowing them to be false;
(4) defalcates or embezzles moneys received in his professional
capacity.
PART III
Other misconduct in relation to members of
the Institute generally
A member of the Institute, whether in
practice or not, shall be deemed to be guilty of other misconduct, if he is
held guilty by any civil or criminal court for an offence which is punishable
with imprisonment for a term exceeding six months.]