In Brief
This judgment addresses whether Multi-national Accounting Firms (MAFs) operate unlawfully in India through Indian Chartered Accountancy Firms despite prohibitions under the Chartered Accountants Act. The Court found MAFs circumvent law by using common international brands, shared infrastructure, and foreign financial inputs through Indian-registered firms. Applying the corporate veil doctrine, the Court held that formal compliance cannot mask substantive violations of statutory prohibitions on corporate practice of accountancy and profit-sharing. The Court directed constituting a government expert committee to revisit the regulatory framework and consider models like Sarbanes-Oxley Act for auditor oversight, ordered completion of ED investigations within three months, and directed ICAI to complete further examination of violations.
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