How to Handle a Dispute with Your C.A. When Important Financial Records Are Stuck?

Due to some misunderstanding between the Managing Director (M.D.) of our company and our Chartered Accountant (C.A.), we have decided to discontinue our old Chartered Accountant and appoint a new one. Unfortunately, our old C.A. is not contacting us, and all the records and some pending work are still with him. He has not even raised his bill for the financial year 2014-2015. If we deposit the TDS of the C.A. for the financial year 2014-15 after 30th April 2015, what will be the interest/penalty amount? What other problems will we face? He handles our audit and Income Tax matters.

I presume that the CA is conducting an internal audit of the company's accounts. The CA does not have the right to retain company records. The CA should have provided his schedule of charges for the audit and IT matters. Please send a responsible officer to his office to collect all company records. It might be advisable to send a registered letter before the visit regarding the bill and company records. TDS has been deposited for QE Mar 15 and should be completed by 30 April. As far as I know, there should be no penalty on this transaction if it is for QE Mar 15. (Please verify this information with another or a new CA/Tax consultant.)

Further to the above, your company's MD may inform the authorities about engaging the new CA. Also, the new CA may like to put his consent in writing for undertaking all activities related to tax filing and returns.

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Not returning records by a CA amounts to misconduct in the profession, besides an offense under Section 406 of the IPC. Send a legal notice for the immediate return of records. Your new CA can advise you of the interest payable for the delay.

Without giving the threat of consequences, the Chartered Accountant who is losing his client will do everything to prevent losing him. This is evident in every profession. Further delay is causing injury to the company only, and without sending a legal notice, the new Chartered Accountant may not be able to explain the delay before the IT authorities.

"Thanks to all for your suggestions. Till date, our old CA is not responding to any of our letters or emails, etc. A legal notice needs to be sent. ICAI can also be informed of misconduct by the CA in a factual and legal manner."