Fee-arrangement working paper · — · prepared using cakarangupta.com/tools

Can you bill it this way?

Five questions about one engagement. You get PERMITTED, PROHIBITED or GREY with the exception cited by letter — and a fee clause you can paste.

This is a sample — the Mobase shape: ₹25 lakh plus 1% of the GST relief, for a client you do not audit, rendered by a CA firm. Replace it with your engagement; the verdict updates as you answer.

1Describe the engagement 2Read the verdict 3Copy the clause verdict updates live

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verdict

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exception relied on

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points to confirm

Describe the engagement

Who renders the service? the first question the tribunal asked Were the services rendered through persons governed by ICAI's regulatory framework?

A Chartered Accountant in practice or a CA firm A company or LLP — but a CA partner or director does the work Nobody who is a member of ICAI (an advocate, a non-CA consultancy)

What is the service? the list of exceptions is written by service Pick the closest description. The exception list is written by service, not by client.

Do you, your firm or your network audit this client? the second question the tribunal asked Statutory audit, tax audit under s.44AB, or any other attest engagement — treat any of them as Yes.

No — we hold no audit or attest engagement of this client Yes — we audit or certify for this client Not sure — another partner or a network firm may hold something

Does any part of the fee depend on the result? This is the only thing Clause (10) and Regulation 192 bite on. A fixed fee is outside the rule however large it is.

Yes — a percentage, or a sum paid only on success No — fixed, time-based or a retainer

What is the percentage measured on? this decides which exception applies The exceptions each name their own base. A permitted service measured on the wrong base is not covered by its exception.

The fee clause you can paste5 optional details — open this to get a clause for the engagement letter▸

Fixed component (₹) The part that does not depend on the outcome. Default ₹25,00,000.

Percentage Of whatever you picked as the base above. Default 1.

A percentage over 100 — check the figure.

Client Appears in the clause verbatim. Default "the Client".

Your firm Appears in the clause verbatim. Default "the Firm".

The percentage crystallises on Say the event, not the month. This is what the parties argued about in Mobase.

Where every line on this page comes fromRegulation 192 is now quoted in full▸

Regulation 192 is quoted in full on this page — the chapeau and exceptions (a) to (h), together with the Council's Note under (h) — from the Code of Ethics (Volume I), Revised 2026, the thirteenth edition, applicable from 1 April 2026, at paragraph 2.15.1.10(iii), read on 27 September 2026. Clauses (d) to (h) were inserted by Notification No. 1-CA(7)/145/2012, Gazette of India Extraordinary, Part III Section 4, dated 1 August 2012. Clause (10) is quoted from India Code.

The Council's Note under clause (h), in the Code's own words:

(i) Insolvency Professional, the fees may be based on percentage of recovery/assets for the services rendered under Insolvency and Bankruptcy Code, 2016 and rules framed thereunder.
(ii) In the case of Non-Assurance Services to Non-Audit Clients, the fees may be charged on contingent basis.

One thing the Code still does not publish: clause (d) covers only "certain management consultancy services as may be decided by the resolution of the Council from time to time", and the Code does not enumerate which. That is why management consultancy stays grey — not because the clause could not be read, but because the list behind it is not published.

India Code — First Schedule to the Chartered Accountants Act, 1949, Part I, Clause (10) — the misconduct itself, quoted on this page
BCAJ, ICAI and its members — reproduces the chapeau of Regulation 192 and exceptions (a), (b) and (c) verbatim
ICAI announcement of 9 June 2017 (V. Sagar, Secretary), reproduced in full — the Council permitting Insolvency Professionals to charge a percentage of recovery or assets, expressly "under the authority vested under clause (h)" of Regulation 192. The Code's own Note is now the primary source for that decision; this announcement is kept for the three extra words the Note does not carry — "either individually or as an entity"
Code of Ethics (Volume I), Revised 2026 — the thirteenth edition, ISBN 978-93-47892-21-9, foreword dated 28.05.2026, applicable from 1 April 2026. Regulation 192 is reproduced in full at para 2.15.1.10(iii), pages 91–93, and is the source of every quotation of the chapeau and exceptions (a) to (h) and the Council's Note under (h) on this page. Volume I also carries R410.9 and R410.10 (no contingent fee for an audit engagement; none for a non-assurance service to an audit client). Read on 27 September 2026 from a readable mirror; ICAI's own CDN copy at resource.cdn.icai.org remains image-locked
ICAI Know Your Ethics (Jan 2023 edition), as reported — carried the non-audit-client decision and the position that a percentage of turnover is not permitted outside the Regulation 192 cases. Superseded as a source by the Code's own Note above, and kept only for the turnover point
CA Act 1949, Chapter V — s.21A(3) Board of Discipline powers (reprimand, removal up to three months, fine up to ₹1,00,000) and s.21B(3) Disciplinary Committee powers
LiveLaw Biz and Bar & Bench on Ernst & Young LLP v. Mobase Electronics India Pvt. Ltd., NCLT Chennai, C.P.(IB)/370(CHE)2025, 25 August 2026
ICAI — the Ethical Standards Board's own portal, ethics.icai.org, read 27 September 2026. This is a live surface: its newest item is a webinar of 18 August 2026 on "Demystifying Code of Ethics 2026 and taxation Services", and before it a webinar of 24 June 2026 and the exposure draft of the thirteenth edition of 27 October 2025. Nothing on it touches contingent, percentage or outcome-based fees — thirty-three days after the Mobase referral. (Earlier checks looked at ICAI's Recent Decisions of the Ethical Standards Board page, whose entries are undated and whose newest dated item is January 2017. Silence from a live board is evidence; silence from a page frozen in 2017 is not.)
The two fee items the ESB has published, neither of which touches Regulation 192: an Advisory on reporting requirements for fees-related disclosure to the Institute under the revised Code, and a Code Update on the revised provisions on NOCLAR, Fee-Relative Size and Tax Services to Audit Clients, with FAQs. Named here because a member reading a fee page should know they exist.
Two other fee rules this page does not decide. The Guidelines on Ethical Issues, 2026 (which replaced the Council General Guidelines, 2008 on 1 April 2026) carry, at Chapter IX, a minimum-fee rule — a member shall not charge fees less than the minimum mandated by the Central or State government or a Regulator, or prescribed by the Council — and at Chapter X, a bar on signing a public-interest entity's audit report while the previous year's undisputed audit fee is unpaid. Neither changes any verdict on this page, and this page's framing predates both.

Rules read to 27 Sep 2026. Regulation 192 — the chapeau, exceptions (a)–(h) and the Council's Note under (h) — quoted in full from the Code of Ethics (Volume I), Revised 2026, thirteenth edition, applicable 1 April 2026, para 2.15.1.10(iii); clauses (d)–(h) inserted by Notification No. 1-CA(7)/145/2012 of 1 Aug 2012. Clause (10), Part I, First Schedule, CA Act 1949 (India Code). The Council's list of which management consultancy services clause (d) reaches is not published in the Code. Disciplinary route: ss.21A(3) and 21B(3), CA Act 1949. Trigger: NCLT Chennai, C.P.(IB)/370(CHE)2025, 25 Aug 2026 — no finding of misconduct; a copy may be forwarded to ICAI if considered appropriate. ICAI's Ethical Standards Board (ethics.icai.org, read 27 Sep 2026) has published nothing on contingent, percentage or outcome-based fees.