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CMA Intermediate · Corporate Accounting and Auditing · National Financial Reporting Authority (NFRA)

Once NFRA has initiated an investigation into the misconduct of a chartered accountant under section 132, what is the position of other institutes or bodies regarding proceedings on the same matter?

Once NFRA has started an investigation, no other institute or body may initiate or continue proceedings in the same misconduct matters. The proviso to the investigation power gives NFRA exclusive jurisdiction, so parallel proceedings are barred.

  1. AThey may continue proceedings in parallel, but NFRA's order prevails
  2. BThey may continue only if the Central Government permits
  3. CNo other institute or body shall initiate or continue any proceedings in such matters of misconductCorrect
  4. DThey may continue proceedings but must not impose any penalty

Explanation

The proviso to section 132(4)(a) states that no other institute or body shall initiate or continue proceedings in such misconduct matters where NFRA has initiated an investigation. Parallel proceedings are therefore barred, so the option allowing continuation is wrong.

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