ICAI initiates Disciplinary Notices against 200 Chartered Accountants involved in incorporation of Chinese companies

For their alleged assistance in helping multiple Chinese enterprises violate the Companies Act 2013 through their India-incorporated subsidiaries and shell companies in recent years, the CA Institute has issued disciplinary notifications to more than 200 chartered accountants.

While the Registrar of Companies (RoCs) had objected in some instances, in others, the issue was viewed as an information case. In June of this year, the ICAI claimed that hundreds of CAs nationwide were being investigated by the CA Institute.

The Foreign Direct Investment (FDI) regulation for investments coming from nations with a land border with India has recently been tightened by the Centre. It appeared that Chinese investments in Indian enterprises were being restricted. While the Foreign Direct Policy was changed in April 2020 to require the Center’s approval for investments from these nearby nations, the Corporate Affairs Ministry (MCA) had previously mandated that residents of those nations obtain the Home Ministry’s approval before being appointed directors of Indian companies.