CA Fined Rs.2.25 Lakhs for exceeding Number of permissible Tax Audit Limits

The Disciplinary Committee of ICAI has imposed fine of Rs.2.25 Lakhs on Chartered Accountant for exceeding Number of permissible Tax Audit Limits.

The Disciplinary Committee was inter-alia of the opinion that CA. Subhra Kumar Kundu (M. No. 053515) (hereinafter referred to as the Respondent”) was GUILTY of professional misconduct falling within the meaning of Clause (1) of Part II of the Second Schedule to the Chartered Accountants Act 1949.

That pursuant to the said findings, an action under Section 218(3) of the Chartered Accountants (Amendment) Act, 2006 was contemplated against the Respondent and a communication was addressed to him there by granting, opportunities of being heard in person /through video conferencing and to make written & verbal representation before the Committee on 22.03.2023.

The Committee noted that on the date of hearing, held on 22.03.2023, the Respondent was present through video conferencing and the Respondent made his verbal submissions on the findings of the Disciplinary Committee. The Committee also noted that the Respondent has also sent details containing list of audits done by under Section 44AD/AE/AF of the Income Tax Act, 1961.

The Committee considered the reasoning as contained in findings holding the Respondent Guilty of professional misconduct vis-a-vis written & verbal representation of the Respondent. The Committee observed that the Respondent has claimed that he has done 132 and 140 audits under Section 44AD/AE/AF during the financial years 2010-11 and 2011-12 respectively.

Keeping in view the facts and circumstances of the case, material on record including verbal & written representations on the findings, the Committee is of the view that even after giving the benefit of audits claimed to have been conducted under section 44AD/AE/AF of the Income Tax Act, 1961, it is seen that the total number of audits continues to exceed the maximum permissible limit of 45 audits and hence the professional misconduct on the part of the Respondent is established, and the ends of justice would be met if reasonable punishment is awarded to the Respondent in this case. Accordingly, the Committee ordered that a fine of Rs.2,25,000/- (Rupees Two Lakh Twenty-Five Thousand only) be imposed upon the Respondent i.e., CA. Subhra Kumar Kundu (M. No. 053515), to be paid within 90 days of receipt of the Order. If the Respondent fails to pay the fine within the stipulated period, his name be removed from the Register of Member for a period of one month.

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