THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA & ORS. versus SHAJI POULOSE & ORS.

Citation: [2020] 9 S.C.R. 851 · Decided: 09-12-2020 · Supreme Court of India · Bench: ASHOK BHUSHAN · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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THE INSTITUTE OF CHARTERED ACCOUNTANTS
OF INDIA & ORS.
v.
SHAJI POULOSE & ORS.
(Transfer Petition (Civil) Nos. 2849-2859/2019)
DECEMBER 09, 2020
[ASHOK BHUSHAN, R. SUBHASH REDDY AND
M. R. SHAH, JJ.]
Transfer Petition – Constitution of India – Art. 139-A(1) –
Supreme Court Rules, 2013 – Or. XL, Rule 1 – In the writ petitions,
which are sought to be transferred, writ petitioners have challenged
validity of  chapter-VI of guidelines No. 1-CA(7)/02/2008 dated
08.08.2008 issued by the Council of petitioner Institute on the
ground that the same is violative of Art. 19(1)(g) of the Constitution
– The said chapter VI of the guidelines dated 08.08.2008 stipulates
that a member of the Institute in practice shall not accept, in a
financial year, more than “specified number of tax audit
assignments”, which is at present 60 u/s. 44 AB of the Income Tax
Act, 1961 – Several writ petitions regarding the same were pending
in the Kerala High Court, Madras High Court and Calcutta High
Court – The Institute of Chartered Accountants of India being the
regulatory body for the profession of Chartered Accountants has
filed the present transfer petitions for transfer of all the aforesaid
writ petitions to the Supreme Court for final and conclusive
determination of the issues involved – Held: The guidelines which
are impugned in the High Court and the consequent disciplinary
proceedings initiated against various Chartered Accountants
throughout the country is an issue of public importance affecting
Chartered Accountants as well as the citizens who have to obtain
compulsory tax audits – To settle the law and to clear the uncertainity
among tax professionals and citizens, it is appropriate that the
Supreme Court may transfer the writ petition, to authoritatively
pronounce the law on the subject – However, the interim orders
operating in different writ petitions which are sought to be
transferred should be allowed to be continued till the Supreme Court
considers the matter and passes any other order – In result, Transfer
Petitions are allowed.
[2020] 9 S.C.R. 851
851
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SUPREME COURT REPORTS
[2020] 9 S.C.R.
Institute of Chartered Accountants of India v. Southern
Petrochemical Industries Corporation Limited and
Another (2007) 15 SCC 649 – referred to.
Case Law Reference
(2007) 15 SCC 649
referred to
Para 14
CIVIL ORIGINAL JURISDICTION: Transfer Petition (Civil)
Nos. 2849-2859 of 2019.
Petitions under Article 139-A(1) of the Constitution of India read
with order XL Rule 1 of the Supreme Court Rules, 2013.
With
Transfer Petition (Civil) Nos. 727-728 of 2019.
Arvind Datar, Sr. Adv., Pramod Dayal, Nikunj Dayal, Advs. for
the Petitioners.
N. Venkataraman, ASG, R. Basant, Sr. Adv., Raghenth Basant,
E.M.S. Anam, Piyush Beriwal, Bhuvan Mishra, Ms. Anil Katiyar, B.
Ramana Kumar, Raghunatha Sethupathy, K. Paari Vendhan,
Krishanmohan, Goutham Shivshankar, Sajith P., Vishu P., Ashwin Kumar
D.S., Ms. Surbhi Mehta, Tapesh Kumar Singh, Aditya Pratap Singh,
Ms. Bhaswati Singh, Advs. for the Respondents.
The Judgment of the Court was delivered by
ASHOK BHUSHAN, J.
1. These transfer petitions have been filed by the Institute of
Chartered Accountants of India under Article 139-A(1) of the Constitution
of India read with Order XL Rule 1 of the Supreme Court Rules, 2013
for transfer of several writ petitions pending in the Kerala High Court,
Madras High Court and Calcutta High Court.
2. Notices were issued in the transfer petitions.  A counter affidavit
has also been filed by one of the respondents, i.e., respondent No.1.
3. We have heard Shri Arvind Datar, learned senior counsel for
the petitioners and Shri R. Basant, learned senior counsel and other
counsel appearing for respondents.
4. In the writ petitions, which are sought to be transferred, writ
petitioners have challenged validity of Chapter VI of Guidelines No.1-
CA(7)/02/2008 dated 08.08.2008 issued by the Council of petitioner
Institute on the ground that the same is violative of Article 19(1)(g) of
the Constitution of India. The said Chapter VI of the Guidelines dated
08.08.2008 stipulates that a member of the Institute in practice shall not
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accept, in a financial year, more than the “specified number of tax audit
assignments”, which is at present 60 under Section 44AB of the Income-
tax Act, 1961. Further, Section 22 of the Chartered Accountants Act,
1949 defines “professional or other misconduct” to include any act or
omission provided in any of th
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