Section 132: Constitution of National Financial Reporting Authority

Section 132: Constitution of National Financial Reporting Authority · Complied AI

(4)

Notwithstanding anything contained in any other law for the time being in force, the National Financial Reporting Authority shall—

(a)

have the power to investigate, either suo motu or on a reference made to it by the Central Government, for such class of bodies corporate or persons, in such manner as may be prescribed into the matters of professional or other misconduct committed by any member or firm of chartered accountant , registered under the Chartered Accountants Act, 1949:

Proviso

Provided that no other institute or body shall initiate or continue any proceedings in such matters of misconduct where the National Financial Reporting Authority has initiated an investigation under this section;

(b)

have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908, while trying a suit, in respect of the following matters, namely:—

(i)

discovery and production of books of account and other documents, at such place and at such time as may be specified by the National Financial Reporting Authority;

(ii)

summoning and enforcing the attendance of persons and examining them on oath;

(iii)

inspection of any books, registers and other documents of any person referred to in clause ( b ) at any place;

(iv)

issuing commissions for examination of witnesses or documents;

(c)

where professional or other misconduct is proved, have the power to make order for—

(A)

imposing penalty of—

(I)

not less than one lakh rupees, but which may extend to five times of the fees received, in case of individuals; and

(II)

not less than ten lakh rupees five lakh rupees, but which may extend to ten times of the fees received, in case of firms;

(B)

debarring the member or the firm from—

I. being appointed as an auditor or internal auditor or undertaking any audit in respect of financial statements or internal audit of the functions and activities of any company or body corporate; or

II. performing any valuation as provided under section 247,

for a minimum period of six months or such higher period not exceeding ten years as may be determined by the National Financial Reporting Authority.

(B)

debarring the member or the firm from engaging himself or itself from practice as member of the Institute of Chartered Accountant of India referred to in clause ( e ) of sub-section ( 1 ) of section 2 of the Chartered Accountants Act, 1949 for a minimum period of six months or for such higher period not exceeding ten years as may be decided by the National Financial Reporting Authority.

Explanation

For the purposes of his sub-section, the expression “professional or other misconduct” shall have the same meaning assigned to it under section 22 of the Chartered Accountants Act, 1949.

Notes, amendments & references (15)

constitution of National Advisory Committee on Accounting Standards vide notification S.O. 2425(E). Central Government has appointed 1st October, 2018 as the date of constitution of National Financial Reporting Authority. To view the notification, Click Here

(1A) Inserted vide the Companies (Amendment) Act, 2019 dated 31.07.2019 w.e.f., 15.08.2019. To view the Amendment Act, Click Here . To view the commencement Notification, Click Here .

Refer the National Financial Reporting Authority Rules, 2018 dated 13.11.2018. To view the Rules, Click Here

Refer t he National Financial Reporting Authority (Manner of Appointment and other Terms and Conditions of Service of Chairperson and Members) Rules, 2018. To view the Rules, Click Here

(3A) Inserted vide the Companies (Amendment) Act, 2019 dated 31.07.2019 w.e.f., 15.08.2019. To view the Amendment Act, Click Here . To view the commencement Notification, Click Here .

(3B) Inserted vide the Companies (Amendment) Act, 2019 dated 31.07.2019 w.e.f., 15.08.2019. To view the Amendment Act, Click Here . To view the commencement Notification, Click Here .

Substituted vide Companies (Amendment) Act, 2017 dated 03.01.2018 effective from 09.02.2018. To view the notification, Click Here

(B) Substituted vide the Companies (Amendment) Act, 2019 dated 31.07.2019 w.e.f., 15.08.2019. To view the Amendment Act, Click Here . To view the commencement Notification, Click Here .

6 ) Omitted vide Companies (Amendment) Act, 2017 dated 03.01.2018 effective from 09.02.2018. To view the notification, Click Here

7 ) Omitted vide Companies (Amendment) Act, 2017 dated 03.01.2018 effective from 09.02.2018. To view the notification, Click Here

8 ) Omitted vide Companies (Amendment) Act, 2017 dated 03.01.2018 effective from 09.02.2018. To view the notification, Click Here

9 ) Omitted vide Companies (Amendment) Act, 2017 dated 03.01.2018 effective from 09.02.2018. To view the notification, Click Here

Refer the National Financial Reporting Authority (Meeting for Transaction of Business) Rules, 2019 dated 22.05.2019. To view the Rules, Click Here

Power delegated by Central Government to National Financial Reporting Authority vide notification S.O. 35(E). dated 04.01.2022. To view the notification, Click Here

Refer the NFRA (Recruitment, Salary, Allowances and Other Terms and Conditions of Service of Secretary, Officers and Other Employees of Authority) Rules, 2019. To view the Rules, Click Here