Clause 2 – Part II – First Schedule Flashcards
Mr. ‘C’, a CA employed as Senior executive in charge of Tax in a company, and not holding COP recommends a particular lawyer to his employer in respect of a case.
The lawyer, out of the professional fee received from the employer of Mr. ‘C’ paid a particular sum as referral fee to Mr. ‘C’.
Comment with reference to the CA Act, 1949 and schedules thereto.
Referral Fee from Lawyer:
According to Clause (2) of Part II of First Schedule of the CA Act, 1949,
a member of the institute (other than a member in practice) shall be guilty of professional misconduct, if he -
being an employee of any company, firm or person accepts or agrees to accept any part of fee, profits or gains from a lawyer, a CA or broker engaged by such company, firm or person or agent or customer of such company, firm or person by way of commission or gratification.
In the present case, Mr. C who beside holding a COP, is also an employee and by referring a lawyer to the company in respect of a case, he receives a particular sum as referral fee from the lawyer out of his professional fee.
Conclusion: Therefore, Mr. C is guilty of professional misconduct by virtue of Clause (2) of Part II of First schedule
