ICAI Reprimands 11 CAs for Professional Misconduct in Alleged Bogus Political Donation
Donations routed to political parties were not genuine contributions but were cycled back to donors in cash, with commissions pocketed by intermediaries and professionals involved
The Institute of Chartered Accountants of India (ICAI), through its Board of Discipline, recently concluded a high-profile inquiry into allegations of 11 chartered accountants from Ahmedabad for professional misconduct linked to an alleged bogus political donation network flagged by the Income Tax Department. The case traces back to a 2021 search and seizure operation...
The Institute of Chartered Accountants of India (ICAI), through its Board of Discipline, recently concluded a high-profile inquiry into allegations of 11 chartered accountants from Ahmedabad for professional misconduct linked to an alleged bogus political donation network flagged by the Income Tax Department.
The case traces back to a 2021 search and seizure operation involving political parties and charitable institutions in Ahmedabad, where investigators alleged large-scale tax evasion practices. According to the department, several chartered accountants facilitated a scheme in which clients routed donations to political party accounts, only to have the funds returned in cash after deducting commissions.
The investigator claimed that 28 CAs facilitated a scheme where clients were guided to route donations into political party bank accounts. That CAs facilitated a scheme where clients were guided to route donations into political party bank accounts.
Donor details were allegedly shared with party functionaries, who issued receipts. Later, the donated amounts were reportedly returned in cash to donors after deducting commissions.
Several CAs gave statements under Sections 132(4) and 131(1A) of the Income Tax Act, acknowledging their involvement, but many attempted to retract these admissions years later, raising questions about credibility.
The ICAI’s Board of Discipline concluded that the 11 accountants were guilty of “Other Misconduct” under the Chartered Accountants Act, 1949. While considering action under Section 21A(3), the Board weighed stronger disciplinary measures but ultimately issued a reprimand.
The Income Tax Department did not initiate reassessment proceedings against the political parties involved. The CAs soughta sympathetic view, assuring the Board that such conduct would not be repeated.
The Board issued a formal reprimand, which is a disciplinary action that falls short of suspension or removal but serves as a public censure.
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