Section 2 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 2(1) is the dictionary of the Chartered Accountants Act, 1949. It says what each defined word means "unless there is anything repugnant in the subject or context", from "associate" and "chartered accountant" to "year". Several clauses were added by the 2022 Amendment Act and are in force from 10 May 2022, but a few of them point to provisions that are not yet in force.
This article is as per the Act as printed in the ICAI edition of 2022 (amended up to the Chartered Accountants, the Cost and Works Accountants and the Company Secretaries (Amendment) Act, 2022). Later amendments and notifications should be checked.
Section 2(1) defines 26 terms by lettered clauses, from (a) "associate" to (i) "year". "Prescribed" means prescribed by regulations made by the Council; "specified" means specified by rules made by the Central Government. The 2022 clauses (ab), (ba), (bb), (cb) to (ce), (g) and (haaa), and the added words in (ea), are in force from 10 May 2022, but "Register" now also covers the Register of firms under section 20B, which belongs to Chapter IVA, not yet in force.
How the definitions are built
Every clause begins "means" or "shall have the meaning" and the whole list is subject to the opening words "unless there is anything repugnant in the subject or context". The footnotes show three layers of amendment: clauses (aa) and (aaa) and a few others inserted by the 2006 Amendment Act (from 8 August 2006), clauses (ca), (eb), (ec) and (haa) inserted by the 2011 Amendment Act (from 1 February 2012), and the 2022 clauses in force from 10 May 2022. If a defined term decides a real question for you, a legal consultation can tie the definition to the section that uses it.
The clauses, as printed
| Clause | Term | What it means |
|---|---|---|
| (a) | associate | an associate member of the Institute |
| (aa) | Authority | the Appellate Authority constituted under section 22A |
| (aaa) | Board | the Quality Review Board constituted under section 28A |
| (ab) | Board of Discipline | the Board constituted under sub-section (1) of section 21A (2022) |
| (b) | chartered accountant | a person who is a member of the Institute |
| (ba) | Coordination Committee | the Committee constituted under section 9A (2022) |
| (bb) | Companies Act | the Companies Act, 2013 or any other previous company law as defined in section 2(67) of that Act (2022) |
| (c) | Council | the Council of the Institute constituted under section 9 |
| (ca) | firm | the meaning in section 4 of the Indian Partnership Act, 1932, and includes a limited liability partnership under the LLP Act, 2008 or a sole proprietorship, registered with the Institute |
| (cb) | Director (Discipline) | the Director (Discipline) referred to in section 21, including a Joint Director (Discipline) (2022) |
| (cc) | Disciplinary Committee | the Committee constituted under sub-section (1) of section 21B |
| (cd) | Disciplinary Directorate | the Directorate established under sub-section (1) of section 21 |
| (ce) | fellow | a fellow member of the Institute |
| Clause | Term | What it means |
|---|---|---|
| (d) | holder of a restricted certificate | a person holding a permanent or temporary restricted certificate granted by a Provincial Government under the Restricted Certificates Rules, 1932 |
| (e) | Institute | the Institute of Chartered Accountants of India constituted under the Act |
| (ea) | notification | a notification published in the Official Gazette, and "notify" is construed accordingly (the last words added in 2022) |
| (eb) | partner | the meaning in section 4 of the Indian Partnership Act, 1932 or in the LLP Act, 2008 |
| (ec) | partnership | a partnership under section 4 of the Indian Partnership Act, 1932, or an LLP which has no company as its partner |
| (f) | prescribed | prescribed by regulations made under the Act |
| (g) | Register | the Register of members under section 19 or the Register of firms under section 20B, as the case may be (2022) |
| (h) | registered accountant | a person enrolled on the Register of Accountants kept by the Central Government under the Auditor's Certificates Rules, 1932 |
| (ha) | specified | specified by rules made by the Central Government under the Act |
| (haa) | sole proprietorship | an individual who engages himself in the practice of accountancy or offers to perform the services in clauses (ii) to (iv) of section 2(2) |
| (haaa) | Standing Committee | a Standing Committee constituted under section 17(1) (2022) |
| (hb) | Tribunal | a Tribunal established under section 10B(1) |
| (i) | year | 1 April to 31 March of the next year |
Terms that appear throughout the Act
Chartered accountant means a member of the Institute. The words "and who is in practice" were omitted in 1959, so a salaried member is as much a chartered accountant as one in practice. "In practice" is separately explained in section 2(2).
Associate and fellow are the two classes of member. How a person becomes one or the other is in section 5.
Prescribed and specified matter in practice. Where the Act says a fee, form, manner or period is "prescribed", the detail is in the regulations made by the Council; where it says "specified", the detail is in rules made by the Central Government. The Act itself does not state the detail, so the regulations or rules must be read for it.
Firm, partner and partnership were widened in 2011 and 2022. A firm now includes an LLP and a sole proprietorship, each "registered with the Institute". A partnership, for the purposes of the Act, is an ordinary partnership or an LLP that has no company as a partner. For the general law of firms, see the Indian Partnership Act, 1932 and the LLP Act, 2008.
Restricted certificate and registered accountant are old-law terms. Clause (d) refers to the Restricted Certificates Rules, 1932 and clause (h) to the Auditor's Certificates Rules, 1932. They are quoted as printed; current law on those rules should be checked.
Companies Act (clause (bb)) means the Companies Act, 2013 or any previous company law as defined in section 2(67) of the 2013 Act. So a reference to the "Companies Act" elsewhere in this Act captures older company law as well.
Definitions that depend on provisions not yet in force
The Chartered Accountants, the Cost and Works Accountants and the Company Secretaries (Amendment) Act, 2022 was brought into force only in part by S.O. 2184(E) dated 10 May 2022. The new definitions came into force from that date, but some of them rely on sections of the Act that were left out of that notification:
| Definition | What it relies on | Position |
|---|---|---|
| (g) Register: includes the Register of firms under section 20B | Chapter IVA (sections 20A to 20D) | Chapter IVA is enacted but not yet in force; only the Register of members under section 19 operates today |
| (ca) firm: "registered with the Institute" | registration of firms under Chapter IVA | the registration route is not yet in force |
| (cb) Director (Discipline): includes a Joint Director (Discipline) | section 21 | the 2006 section 21 in force names a Director (Discipline); the Joint Director appears in the 2022 text of section 21, not yet in force |
| (cd) Disciplinary Directorate: established under section 21(1) | section 21 | the 2006 section 21(1) in force also establishes a Disciplinary Directorate |
None of this makes the definitions inoperative; it means they should be read with the section that is actually in force. A later commencement notification should be checked.
Need help with a point of interpretation?
Whether a defined term catches your facts, for example whether an LLP or a sole proprietorship is a "firm", depends on the whole Act and the regulations. A legal consultation can walk through the definition, the section that uses it and the current position.
Key takeaways
- Section 2(1) lists the defined terms in clauses (a) to (i), with lettered sub-clauses inserted in 2006, 2011 and 2022.
- A chartered accountant is a member of the Institute, whether or not in practice.
- "Prescribed" points to Council regulations; "specified" points to Central Government rules.
- The 2022 definitions are in force from 10 May 2022.
- "Register" now includes the Register of firms under section 20B, which is part of Chapter IVA and not yet in force.
- "Restricted certificate" and "registered accountant" are quoted from 1932 rules; check current law.
Read next
- Section 2(2) of the Chartered Accountants Act, 1949: when a member is deemed to be in practice
- Sections 1 and 3 of the Chartered Accountants Act, 1949: short title, extent, commencement and incorporation
- Section 21 of the Chartered Accountants Act, 1949: the Disciplinary Directorate
- Section 2 of the Cost Accountants Act, 1959: definitions and deemed practice
Disclaimer: Based on the Chartered Accountants Act, 1949 as printed in the ICAI edition of 2022 (amended up to Act 12 of 2022), read with S.O. 2184(E) dated 10 May 2022, which brought only part of the 2022 amendments into force, as consulted on 3 October 2026. Regulations, rules, Council guidelines, later amendments and commencement notifications should be checked. This article is general information, not legal advice; check the official text before acting.