The Company Secretaries Act, 1980

1[THE FIRST SCHEDULE

[See sections 21(3), 21A(3) and 22]

PART I

Professional misconduct in relation to company secretaries in practice

A Company Secretary in practice shall be deemed to be guilty of professional misconduct,

if he—

(1) allows any person to practice in his name as a Company Secretary unless such person is also a

Company Secretary in practice and is in partnership with or employed by him;

(2) pays or allows or agrees to pay or allow, directly or indirectly, any share, commission or

brokerage in the fees or profits of his professional business, to any person other than a member of the

Institute or a partner or a retired partner or the legal representative of a deceased partner, or a member

of any other professional body or with such other persons having such qualifications as may be

prescribed, for the purpose of rendering such professional services from time to time in or outside

India.

Explanation.—In this item, “partner” includes a person residing outside India with whom a

Company Secretary in practice has entered into partnership which is not in contravention of item (4)

of this Part;

(3) accepts or agrees to accept any part of the profits of the professional work of a person who is

not a member of the Institute:

Provided that nothing herein contained shall be construed as prohibiting a member from entering

into profit sharing or other similar arrangements, including receiving any share commission or

brokerage in the fees, with a member of such professional body or other person having qualifications,

as is referred to in item (2) of this part;

(4) enters into partnership, in or outside India, with any person other than a Company Secretary in

practice or such other person who is a member of any other professional body having such

qualifications as may be prescribed, including a resident who but for his residence abroad would be

entitled to be registered as a member under clause (e) of sub-section (1) of section 4 or whose

qualifications are recognised by the Central Government or the Council for the purpose of permitting

such partnerships;

(5) secures, either through the services of a person who is not an employee of such company

secretary or who is not his partner or by means which are not open to a Company Secretary, any

professional business:

Provided that nothing herein contained shall be construed as prohibiting any arrangement

permitted in terms of items (2), (3) and (4) of this Part;

(6) solicits clients or professional work, either directly or indirectly, by circular, advertisement,

personal communication or interview or by any other means:

Provided that nothing herein contained shall be construed as preventing or prohibiting—

(i) any company secretary from applying or requesting for or inviting or securing professional

work from another company secretary in practice; or

(ii) a member from responding to tenders or enquiries issued by various users of professional

services or organisations from time to time and securing professional work as a consequence;

1. Subs. by Act 8 of 2006, s. 32, for  the First Schedule and  the Second Schedule (w.e.f. 8-8-2006).

(7) advertises his professional attainments or services, or uses any designation or expressions

other than Company Secretary on professional documents, visiting cards, letterheads or sign boards,

unless it be a degree of a University established by law in India or recognised by the Central

Government or a title indicating membership of the Institute of Company Secretaries of India or of

any other institution that has been recognised by the Central Government or may be recognised by the

Council:

Provided that a member in practice may advertise through a write up setting out the services

provided by him or his firm and particulars of his firm subject to such guidelines as may be issued by

the Council;

(8) accepts a position as a Company Secretary in practice previously held by another Company

Secretary in practice without first communicating with him in writing;

(9) charges or offers to charge, accepts or offers to accept, in respect of any professional

employment, fees which are based on a percentage of profits or which are contingent upon the

findings, or results of such employment, except as permitted under any regulation made under this

Act;

(10) engages in any business or occupation other than the profession of Company Secretary

unless permitted by the Council so to engage:

Provided that nothing contained herein shall disentitle a Company Secretary from being a director

of a company except as provided in the Companies Act, 1956(1 of 1956);

(11) allows a person not being a member of the Institute in practice, or a member not being his

partner to sign on his behalf or on behalf of his firm, anything which he is required to certify as a

Company Secretary, or any other statements relating thereto.

PART II

Professional misconduct in relation to members of the Institute in service

A member of the Institute (other than a member in practice) shall be deemed to be guilty of

professional misconduct, if he, being an employee of any company, firm or person—

(1) pays or allows or agrees to pay, directly or indirectly, to any person any share in the

emoluments of the employment undertaken by him;

(2) accepts or agrees to accept any part of fees, profits or gains from a lawyer, a Company

Secretary 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.

PART III

Professional misconduct in relation to members of the Institute generally

A member of the Institute, whether in practice or not, shall be deemed to be guilty of professional

misconduct, if he—

(1) not being a Fellow of the Institute, acts as a Fellow of the Institute;

(2) does not supply the information called for, or does not comply with the requirements asked

for, by the Institute, Council or any of its Committees, Director (Discipline), Board of Discipline,

Disciplinary Committee, Quality Review Board or the Appellate Authority;

(3) while inviting professional work from another Company Secretary or while responding to

tenders or enquiries or while advertising through a write up, or anything as provided for in items (6)

and (7) of Part I of this Schedule, gives information knowing it to be false.

PART IV

Other misconduct in relation to members of the Institute generally

A member of the Institute, whether in practice or not, shall be deemed to be guilty of other

misconduct, if—

(1) he is held guilty by any civil or criminal court for an offence which is punishable with

imprisonment for a term not exceeding six months;

(2) in the opinion of the Council, he brings disrepute to the profession or the institute as a result

of his action whether or not related to his professional work.

THE SECOND SCHEDULE

[See sections 21(3), 21B(3) and 22]

PART I

Professional misconduct in relation to company secretaries in practice

A Company Secretary in practice shall be deemed to be guilty of professional misconduct, if he—

(1) discloses information acquired in the course of his professional engagement to any person

other than his client so engaging him, without the consent of his client, or otherwise than as required

by any law for the time being in force;

(2) certifies or submits in his name, or in the name of his firm, a report of an examination of the

matters relating to company secretarial practice and related statements unless the examination of such

statements has been made by him or by a partner or an employee in his firm or by another Company

Secretary in practice;

(3) permits his name or the name of his firm to be used in connection with any report or statement

contingent upon future transactions in a manner which may lead to the belief that he vouches for the

accuracy of the forecast;

(4) expresses his opinion on any report or statement given to any business or enterprise in which

he, his firm, or a partner in his firm has a substantial interest;

(5) fails to disclose a material fact known to him in his report or statement but the disclosure of

which is necessary in making such report or statement, where he is concerned with such report or

statement in a professional capacity;

(6) fails to report a material mis-statement known to him and with which he is concerned in a

professional capacity;

(7) does not exercise due diligence, or is grossly negligent in the conduct of his professional

duties;

(8) fails to obtain sufficient information which is necessary for expression of an opinion or its

exceptions are sufficiently material to negate the expression of an opinion;

(9) fails to invite attention to any material departure from the generally accepted procedure

relating to the secretarial practice;

(10) fails to keep moneys of his client other than fees or remuneration or money meant to be

expended in a separate banking account or to use such moneys for purposes for which they are

intended within a reasonable time.

PART II

Professional misconduct in relation to members of the Institute generally

A member of the Institute, whether in practice or not, shall be deemed to be guilty of professional

misconduct, if he—

(1) contravenes any of the provisions of this Act or the regulations made thereunder or any

guidelines issued by the Council;

(2) being an employee of any company, firm or person, discloses confidential information

acquired in the course of his employment, except as and when required by any law for the time being

in force or except as permitted by the employer;

(3) includes in any information, statement, return or form to be submitted to the Institute, Council

or any of its Committees, Director (Discipline), Board of Discipline, Disciplinary Committee, Quality

Review Board or the Appellate Authority any particulars knowing them to be false;

(4) defalcates or embezzles moneys received in his professional capacity.

PART III

Other misconduct in relation to members of the Institute generally

A member of the Institute, whether in practice or not, shall be deemed to be guilty of other

misconduct, if he is held guilty by any civil or criminal court for an offence which is punishable with

imprisonment for a term exceeding six months.]