New Delhi: The Delhi High Court on Tuesday has issued notice in a petition challenging the constitutional validity of Sections 132(2) and 132(4) of the Companies Act 2013 which empowers the National Financial Reporting Authority (NFRA) to investigate professional misconduct by Chartered Accountants and take disciplinary action against them.
A Division Bench of Chief Justice DN Patel and C Hari Shankar issued notice to the Central Government, Institute of Chartered Accountants of India (ICAI) and the NFRA in a petition preferred by the petitioner Federation of Chartered Accountants Association.
The petitioner has pleaded his case that Section 132(2) and Section 132(4) facilitate arbitrary and illegal regulation and control of professionals registered under the Chartered Accountants Act, 1949 by the NFRA to the exclusion of the ICAI.
The petitioner has further submitted that a Chartered Accountant registered by the ICAI under the Chartered Accountant Act, 1949 which is a special act for Chartered Accountants and therefore, it is the ICAI which has the authority and right to regulate his/her conduct.
Arguing that an authority which has not issued the license to practice would have no authority to affect the fundamental right of a professional to work, the petitioner has submitted.
