The process of redressal regarding complaints received by The Institute of Chartered Accountants of India (ICAI) against chartered accountants (CAs) has been slow. There have also been fluctuations in the number of complaints received per year. In its reply to queries posed by The Sunday Guardian, CA Nilesh S. Vikamsey, President, ICAI, explained the reasons behind the increase and decrease in complaints, the redressal process and how ICAI is keen to adopt e-hearings to make the process efficient.

Vikamsey said: “The number of complaints and information received is as per actuals. Hence, the fluctuations are based on the actual receipts. In fact, it is seen that the increasing trend may be due to confidence in the disciplinary mechanism of the Institute.”

The Disciplinary Mechanism of the ICAI is governed by the CA Act 1949 and the rules framed under the Act. The CA Act was amended in 2006 containing significant changes to the Disciplinary Mechanism. Vikamsey added: “ICAI based upon internal reference received has recently initiated 287 cases of violation of Tax Audit limits prescribed by the Council of ICAI. These suo moto information cases are a testimony to the efficacy of disciplinary mechanism whereby the number of disciplinary cases is on the increase during the relevant period.”

According to Vikamsey, the pendency in disciplinary actions has been reduced substantially after the Amendments in 2006. He said, “Earlier, under the provisions of the old Act, the disciplinary process generally used to take seven to eight years. Under the revised Act, the current position is that at the prima facie stage, the pendency which was brought down to about three years in June 2017 is being further brought down to about a year or  so very soon. At the Disciplinary Committee stage, the pendency under the old provisions of the Act was about four to five years which currently has been narrowed down to only around two years and is being constantly brought down further.”

However, explaining the long process of addressing a complaint, the ICAI president said:“Since every complaint/ allegation received at the Disciplinary Directorate is required to go through a quasi-judicial procedure as envisaged under the relevant provisions of the Chartered Accountants Act & Rules framed thereunder, it is quite natural that it takes a certain amount of time to dispose of the matter in its entirety in order to meet the principles of natural justice. ”

The ICAI has also constituted a group to look into the changes required for amendments in the Disciplinary Mechanism and its interim recommendations as approved by the Council have been forwarded to the Ministry of Corporate Affairs. 

Vikamsey said, “The proposed amendments including provisions to have e-hearings would necessarily go a long way in creating a more vibrant and transparent process and enable expeditious disposal of the disciplinary proceedings. Among judicial bodies in the country, we believe our pendency is the lowest, though vigorous efforts are on to reduce it further.”

Countering the skepticism towards ICAI punishing corrupt CAs, Vikamsey said, “In matters relating to the Satyam episode, the Disciplinary Committee had given punishment within three days following the court’s orders. Also, certain alleged cases of professional misconduct which came to light immediately after the demonetisation was announced, were processed expeditiously and decided within a period of six months.”

Vikamsey added, “It is felt necessary to mention here that in the present council year, over 700 Prima Facie Opinions (PFOs) have been drafted which are under finalisation before Board of Discipline/ Disciplinary Committee (BoD/DC) as the case may be. Moreover, during the year, BoD/DC have held several meetings and apart from concluding hearings in 92 cases, have also considered and disposed 628 PFOs. Further, during the year, BOD/ DC have, based on enquiry, awarded punishment in 40 cases to the delinquent members.”

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