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NPA effect: Norms for chartered accountants, advocates soon

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Public sector banks, saddled with rising non-performing assets (NPAs) — loans that do not fetch returns — are likely to frame stringent rules, allowing lenders to take action against service providers such as chartered accountants and advocates if required.
The Central Vigilance Commission (CVC) has asked banks to come up with appropriate guidelines, saying bank officials should not be solely held responsible for the rise in NPAs, which went up by Rs.94,666 crore in the April-December period of 2015-16.
“At present, bank officials are taking the entire responsibility (of the issue of NPA) but this is a narrow way of dealing with the problem and the role of CAs and lawyers must be scrutinised. A framework needs to be designed so that they are accountable too,” an official source said.
Two out of 10 loan applications are being rejected due to the NPA pressure, even as finance minister Arun Jaitley has asked banks not to adopt an over-cautious approach, sources said.
The CVC has also raised the issue with the Institute of Chartered Accountants of India (ICAI).
Hindustan Times New Delhi,18th April 2016

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