CA. Rudra is the Chief Financial Officer of DGT General Insurance Limited. Being in the insurance business, the company gets majority of its clients…

According to Clause (2) of Part II of First Schedule of the Chartered Accountant 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 chartered accountant 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. The objective is that when a member is in employment, he must maintain high level of ethics and should not accept any other amount from anyone for which he is not entitled from employer under contractual agreement of service. In the present case, CA. Rudra is the Chief Financial Officer of DGT General Insurance Limited. He releases the commission payments on the condition that he gets 25% of the commission amount from the agent as majority of the clients are through their agency only. Therefore, CA. Rudra is guilty of professional misconduct by virtue of Clause (2) of Part II of First Schedule of the Chartered Accountant Act, 1949.