However, crucial disciplinary mechanism-related changes remain to be implemented
In just over a month since its enactment by the Parliament, the Centre has put into effect most provisions of the Chartered Accountants amendment, the Cost and Works Accountants and the Company Secretaries (amendment) Act, 2022.
It may be recalled that the Act had, among other changes, sought to overhaul the disciplinary mechanism in three professional bodies — chartered accountants, company secretaries and cost accountant institutes. The main intent of this law is to bring more transparency in the functioning of the institutes, especially their disciplinary matters and raise the quality of disciplinary process.
The Corporate Affairs Ministry has now passed an executive order to bring most provisions of this amendment Act into force from May 10, sources said. However, the crucial provisions that brought changes to the disciplinary mechanism in the three institutes are not covered in the latest move, they added.
With the Parliament having passed the Act, a non-member would become the presiding officer of the disciplinary committee in these institutes. However, a solace for the institutes is that the government would be appointing the officer only out of the names recommended by their respective Central Council.
As part of the revamp of the disciplinary committee, the law had brought a change in its composition so as to introduce a 2+3 formula (two institute nominees and three non-institute members).
It maybe recalled that the CA Institute had said — prior to the enactment of the law— the disciplinary committee revamp was not the best outcome for it and therefore, had written to the Ministry of Corporate Affairs seeking a re-look at the provision. The ICAI had preferred continuation of the earlier 3+2 formula and had also submitted that the presiding officer has to be a member of the institute and a chartered accountant for the disciplinary mechanism to work efficiently. However, these views did not find acceptance with the Centre.