What Can You Do If Your CA Acts Unprofessionally? Here’s What Counts as Misconduct

Most people hire a Chartered Accountant for everyday needs like filing income tax returns, responding to notices, or getting help with GST. You expect diligence, honesty, and timely replies. When that does not happen, you are not powerless. Indian law clearly defines what counts as misconduct and it gives you practical routes to seek redress.

Let's first explore what counts as misconduct legally in India.

What “Unprofessional” Means in Law

The law uses the phrase professional or other misconduct. It is defined in the Chartered Accountants Act, 1949.

Section 22 says misconduct includes anything listed in the Schedules and also allows the Director of Discipline to inquire in other appropriate cases.

The Schedules then spell out common client-facing breaches:

1. Confidentiality and Conflicts

• Disclosing client information without consent or a legal mandate is misconduct.
• Issuing an opinion where the CA or the firm has a substantial interest in the entity is also misconduct.
• These are covered in Second Schedule Part I clauses 1 and 4.

2. Quality, Diligence, and Reporting

• Failing to disclose material facts
• Failing to report misstatements
• Lack of due diligence
• Not obtaining sufficient appropriate evidence
• Ignoring auditing standards. All appear in Second Schedule Part I, clauses 5 to 9.
• Signing or certifying reports without proper examination appears in clause 2.

3. Client Money and Documents

• Not keeping client money in a separate account or not using it promptly for its intended purpose is misconduct under Second Schedule Part I clause 10.

4. Improper Solicitation and Fee Sharing

• The First Schedule restricts solicitation, advertising, and fee sharing with non-members except in narrow cases. These are common red flags seen by individual clients.

5. Other Misconduct

• Conduct that brings disrepute to the profession can be punished even if it happens outside regular professional tasks.

All of this sits alongside the ICAI Code of Ethics, which requires:

• Integrity
• Objectivity
• Professional competence and due care
• Confidentiality
• Professional behavior

The current Code is the 2019 edition, made effective in 2020.

If Your CA Will Not Respond to Calls or Messages

Silence can be costly. The law does not list unanswered calls as a separate offence, but repeated non-response can still amount to lack of due care and a breach of professional behavior under the Code of Ethics.

If that silence causes a missed deadline or a penalty, it can also be a deficiency in service for consumer law purposes.

• Keep a simple log of dates, channels, and short notes of what you asked. That log becomes strong evidence later.
• Send a courteous email setting a final deadline. Ask for confirmation by a specific date and state that you will move the work if there is no reply. This shows reasonableness and protects you if you later claim compensation for losses caused by delay.

Your Remedy Map for Everyday Clients

You can choose a professional discipline route and a consumer compensation route together if needed.

A. Consumer Protection Route (for Refund and Compensation)

Why It Applies

Professional services are covered by the Consumer Protection Act, 2019 unless they are free or a pure contract of personal service. See section 2(42) – definition of service.

"service" means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, telecom, boarding or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;

Where to File and What to Ask For

• File before the District Consumer Commission if within its pecuniary jurisdiction.
• The forum can order:
• Refund of fees with interest
• Compensation for loss due to negligence
• Removal of deficiency
• Punitive damages (in fit cases). Remedies under section 39.

Time limit: Two years from cause of action (section 69). Delay can be condoned for sufficient cause.

Which Sections to Cite

• Section 35 – who can file and manner (including e-filing)
• Section 34 – jurisdiction:
• District: up to Rs. 1 crore (based on value of consideration paid)
• State: above Rs. 1 crore to Rs. 10 crore (section 47)
• National: above Rs. 10 crore (section 58)
• These limits were upheld by the Supreme Court in April 2025
• Section 39 – orders the forum can pass
• Section 69 – limitation period

Practical Filing Tip

Use the electronic filing system permitted by section 35. Check your state’s current portal at the time of filing.

How to Frame Your Prayer

Ask for:

• Refund of fees with interest from the payment date
• Compensation equal to the penalty or loss caused by CA’s negligence or non-response
• Costs of the complaint
• Punitive damages if the conduct was willful (Cite section 39)

B. ICAI Disciplinary Route (for Professional Sanctions)

Legal Basis

• Section 21: Creates Disciplinary Directorate
• Director Discipline forms a prima facie view and routes to:
• Board of Discipline – First Schedule
• Disciplinary Committee – Second Schedule / combined
• Section 22 defines misconduct

Form and Rules

• File under 2007 Disciplinary Rules – Form I (in triplicate)
• Fee: Rs. 2,950 (including GST)
• Rule 3 governs filing
• Courier/post allowed; date of receipt counts

Filing in Practice

• Use ICAI E Form I
• Must print, sign, and send in triplicate with evidence to the Director of Discipline, Noida
• Cite this note in your cover letter to confirm compliance

Outcomes

• Board of Discipline (Section 21A): reprimand, fine, temporary removal
• Disciplinary Committee (Section 21B): higher fines, removal from membership

How to Assemble a Strong File

1. Evidence Folder

• Engagement letter/email confirmation
• Invoices, payment proofs
• Emails, messages, logs
• Drafts of returns or certificates
• Notices or penalty orders

2. Issue List Matched to Clauses

Create a one-page table mapping problems to clauses

For Example:

• Client information disclosed without consent → Second Schedule Part I, Clause 1
• CA issued an opinion where they had a financial interest → Clause 4
• Report or certificate signed without proper examination → Clause 2
• Material facts not disclosed in a report → Clause 5
• Misstatements not reported → Clause 6
• Lack of due diligence or careless work → Clause 7
• Insufficient evidence before giving opinion → Clause 8
• Ignored mandatory auditing or accounting standards → Clause 9
• Client money not kept in a separate account or misused → Clause 10
• Solicitation of clients through ads or agents → First Schedule Part I (Solicitation clauses)
• Sharing fees with non-CAs → First Schedule Part I (Fee sharing clauses)
• Non-response to calls or messages, causing loss → ICAI Code of Ethics (Professional Behavior & Due Care)
• Negligent work leading to penalties or losses → Second Schedule Part I, Clauses 7 & 8, and Consumer Protection Act, 2019
• False or misleading certificates or reports → Clauses 2, 5, 6
• Unethical conduct bringing disrepute to profession → Section 22 (“Other Misconduct”)

3. Choose Forum & Draft Prayer

• Consumer complaint: refund + interest + compensation (section 39)
• ICAI complaint: cite clauses, request action (sections 21A/21B). You can pursue both.

4. File Correctly

• ICAI: E Form I → print, sign, post in triplicate
• Consumer court: check the state e-filing portal, file within the limitation

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