TMI Blog1998 (7) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... t forced him to file these writ petitions and prayed that the writ petitions may be ordered as prayed for. Per contra, on behalf of the first respondent seperate counter-affidavits have been filed rebutting all the material allegations levelled against them one after the other and ultimately they have requested this court to dismiss the writ petitions for want of merit. Heard the arguments advanced by learned counsel appearing for the writ petitioners and also those of learned counsel appearing for the first respondent. I have also perused the contents of the affidavits and the together with all the relevant material documents available on record in the form of typed set of papers. I have also taken into consideration the various points raised by learned counsel appearing for the respective parties during the course of their arguments. In such circumstances, the common point that arises for consideration in these writ petitions is, as to whether there are any valid grounds to allow these writ petitions or not. Having seen the entire records in these cases the following are the admitted facts. The petitioner herein is a member of the first respondent and he became a member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. It is no doubt true that it is a highly respected profession with absolute integrity. According to the petitioner herein, in such circumstances, years of hard work and knowledge are required to qualify as a member of the Institute and once a person acquires the said qualifications, he would be free to engage himself in the profession without any kind of restriction except for a conduct amounting to dishonesty as it is understood in the ordinary course of the sense of the word and also a conduct which deserves condemnation. It is also significant to note that a chartered accountant is expected to function honestly and not to conduct himself in a manner inviting public criticism and to function with dignity and also that the Act and the Rules made thereunder would be entitled to bring restrictions or provisions only for the purpose of attaining the aforesaid professional standards. It is relevant to mention, that compulsory audit of the books of account and other records of companies incorporated under the Companies Act, and also of all other persons whose turnover is in excess of Rs. 40 lakhs under the Income-tax Act is provided under which the work of audit is authorised to be p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 1. The specified number is stated as 30 audits in a financial year whether in respect of corporate or non-corporate assessees. Separate provision has been made for a partnership of chartered accountants. According to the said notification, if a chartered accountant had already accepted assignments in excess of the specified assignments, he should intimate his inability to conduct tax audits in excess of the specified number of the concerned assessees. This notification is under challenge in W. P. No. 5925 of 1989. The impugned notification in W. P. No. 5926 of 1989 is the notification dated May 25, 1987. By the said notification, the Council of the first respondent has classified partnerships of chartered accountants in the following manner : (a) A firm consisting of four or more partners but less than eight partners with at least one partner holding a certificate of practice for five years or more ; or (b) A firm consisting of eight or more partners with at least one partner holding a certificate of practice for five years or more and the said notification further provides that if the abovesaid firm accepts or carries out any audit work involving receipt of audit fees (ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncept which is understood as meaning something irregular or one committed by a professional in relation to his duties which will amount to dishonesty or an act lowering the dignity of the profession. What a professional would consider it proper to charge as fee in a particular case is a matter of discretion of the individual professional concerned and the same cannot be fixed or controlled by enlarging the definition of professional misconduct. As rightly contended by the petitioner herein, in this case by an enlargement of the definition of professional misconduct, an artificial meaning is given by which restrictions are brought on the right of a chartered accountant in practice to charge a fee as to what he may consider to be appropriate. Further, the notification has no purpose nor meaning in prescribing a rate of fee to be charged in accordance with the population of an area and the number of partners a firm may possess. Further, as rightly contended by learned counsel for the petitioner, the notification has lost sight of the fact that a professional fee is chargeable only in relation to the work done and does not have any bearing to any population or the number of partners. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e considered unprofessional and be made a misconduct. Further, the main object of the Act is to regulate the conduct of the members of the Institute in carrying out their professional duties. Willingness to carry out his professional work cannot be enlarged into professional misconduct by adopting an artificial device of placing a restriction on the volume of work. A professional has a fundamental right to choose his own volume of work. No other profession has any such restriction. It has to be remembered that a high degree of professional competence is required and heavy responsibilities are placed on chartered accountants under the several enactments. Only a chartered accountant is capable of issuing a certificate that is required under the Income-tax Act. Under the Companies Act also only a chartered accountant is empowered to issue a certificate. Further, it has also been admitted even by the respondents that years of hard work and knowledge are required to qualify as a member of the Institute. That being so, once a person acquires the said qualifications, he would be free to engage himself in the profession without any kind of restriction except for a conduct amounting to dish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to abandon the profession and seek employment elsewhere, the Institute thought it necessary to restrict the number of tax audits to 30. According to him, these tax audits which are compulsory under the statute, consume quite a considerable time and if an auditor were to sincerely discharge his duties, he can do only 30 tax audits in a year and the Institute of Chartered Accountants being in the best position to decide on that question, had restricted the number of tax audit assignments to 30 in a financial year. It is significant to note that the time taken for audit by an able chartered accountant may be far less than the time taken by another chartered accountant of restricted ability, All the auditors cannot be placed on an equal footing and an assumption cannot be made that an auditor would be able to fulfil his obligations only up to 30 tax audit assignments under section 44AB of the Income-tax Act, per financial year. It is not known on what basis or on what statistics it is contended by the respondents that only 30 tax assignments can be undertaken by a chartered accountant. What applies to an individual chartered accountant would equally apply to a partner of a firm in w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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