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2021 (3) TMI 274 - HC - Indian LawsProfessional Misconduct - Disciplinary Committee of ICAI has observed that the petitioner is guilty of professional gross negligence and held him guilty for expressing opinion on financial status of company in which he was having substantial interest - complaint was made against the petitioner to the effect that complainant wife is Director, therefore, she cannot sign balance-sheet - principles of natural justice - HELD THAT:- From perusal of the record it is seen that some undisputed facts are that initially the complaint made against the petitioner was on the basis of which the cognizance was taken by the disciplinary authority was prayed to be withdrawn by filing the affidavit by the complainant itself. Even after filling of withdrawal application the Committee has continued the proceedings. The order impugned reflects that same is being based on mere considering the possibility of collusion of the respondent with the Director of the Company. There is no substantial material available on record which have been considered by the disciplinary committee who arrived at conclusion that the wife of the respondent was having substantial interest in the company. In para 7 of the impugned order it is held by the disciplinary committee that “Although, the Respondent wife's holding does not fall within the clear cut definition of substantial interest, yet looking into the supporting documents which shows that she has been authenticating the Financial Statements of the Company for the Financial Year 2009-2010, signing annual return, holding more than 20% shares in the Company seem to suggest that she had substantial interest in the Company.” In para 8 the disciplinary committee has arrived at the conclusion that there is some possible collusion of the Respondent with the Director of the Company. He is being guilty by the disciplinary committee on the basis of material available on record. Further in para 11 of the impugned order shows that despite an application for withdrawal of the complaint which was received on 31.10.2014 the disciplinary committee has continued with the proceedings. This clearly goes to show that the impugned order has been passed merely on the basis of possibilities. In the present case the disciplinary committee has passed the order only on the basis of preponderance of probability and the petitioner was held guilty, despite of the fact that the charges levelled against the petitioner are required to be proved beyond reasonable doubt. Once the complainant has itself submitted an affidavit for withdrawal of his complaint there was no occasion for the disciplinary committee to continue the proceedings as the proceedings is not in the nature of suo motu proceedings. The arguments advanced by the respondents that the authorities are having powers to take up the matter on its suo motu, but these proceedings are taken up by the authorties on the basis of complaint made against the petitioner and not under the suo motu proceedings. Thus, the aforesaid arguments has no limbs to stand. The order impugned is unsustainable as the same is violative of principle of natural justice and fair play and has been passed without following the procedure as contemplated under the Act of 1949 - Petition allowed - decided in favor of petitioner.
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