Appendix No-26 – The Chartered Accountants Act, 1949

13^th January, 1989

No. 1-CA(7)/3/88.– In exercise of the powers conferred by clause (ii) of Part II of the Second Schedule to the Chartered Accountants Act, 1949, the Council of the Institute of Chartered Accountants of India hereby specifies that a member of the Institute in practice shall be deemed to be guilty of professional misconduct, if he accepts, in a financial year, more than the “specified number of tax audit assignments ”under Section 44AB of the Income-tax Act, 1961.

Provided that in the case of a firm of chartered accountants in practice, the “specified number of tax audit assignments ”shall be construed as the specified number of audit tax assignments for every partner of the firm.

Provided further that where any partner of the firm is also a partner of any other firm or firms of chartered accountants in practice, the number of tax audit assignments which may be taken for all the firms together in relation to such partner shall not exceed the “specified number of tax audit assignments ”in the aggregate.

Provided further that where any partner of a firm of chartered accountants in practice accepts one or more tax audit assignments in his individual capacity, the total number of such assignments which may be accepted by him shall not exceed the “specified number of tax audit assignments ”in the aggregate.

Explanation –

1. For the above purpose, “specified number of tax audit assignments ”means-

(a) in the case of a chartered accountant in practice or a proprietary firm of chartered accountant, 30 tax audit assignments, in a financial year, whether in respect of corporate or non-corporate assesses.

(b) in the case of firm of chartered accountants in practice, 30 tax audit assignments per partner in the firm, in a financial year, whether in respect of corporate or non-corporate assesses.

2. In computing the “specified number of tax audit assignments”, each year’s audit would be taken as a separate assignment.

3. In computing the “specified number of tax audit assignments”, the number of such assignments, which he or any partner of his firm has accepted whether singly or in combination with any other chartered accountants in practice or firm of such chartered accountants, shall be taken into account.

4. The audit of the head office and branch offices of a concern shall be regarded as one tax audit assignment.

5. The audit of one or more branches of the same concern by one chartered accountant in practice shall be construed as only one tax audit assignment.

6. The above notification shall come into force from the financial year commencing on or after 1^st April, 1989.

7. A chartered accountant in practice and every partner of a firm of such chartered accountants holding immediately before 1^st April, 1989, tax audit assignments in excess of the specified number, shall within sixty days from 1^st April, 1989, intimate his inability to conduct tax audit in excess of the specified number to the concerned assesses.

8. A chartered accountant in practice shall maintain a record of the tax audit assignments accepted by him in each financial year in the format as may be prescribed by the Council.

M.C. Narasimhan

Secretary

[The Notification given in Appendix No. (27) was in operation until issuance of Council General Guidelines, 2008 – No. 1-CA(7)/02/2008 dated 8^th August, 2008, given at Appendix No. (34)]