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2019 (8) TMI 475 - HC - Indian LawsProfessional misconduct on the part of CA - Clause 7 of Part-I of Second Schedule to the Chartered Accountants Act, 1949 - It is alleged that the accounts and audit report in respect of seven separate companies mentioned in the complaint had not been prepared in compliance with the provisions of the Companies Act, 1956 and directions issued by the Reserve Bank of India (RBI) in respect of a non-banking financial company - HELD THAT:- Since, the petitioner is a company, this Court had called upon the learned counsel appearing for the petitioner to respond as to whether the Memorandum of Association of the petitioner company permitted the petitioner to pursue such complaints against various Chartered Accountants wholly unconnected with its business. The learned counsel had answered in the affirmative. He has also produced the Memorandum of Association of the petitioner company, in compliance with the orders passed by this Court on 26th July, 2019. The issue whether the petitioner company is permitted to carry on the activity of filing complaints against various Chartered Accountants was considered by this Court in the decision rendered today in WHOLESALE TRADING SERVICES P LTD. VERSUS THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA AND ORS. [2019 (8) TMI 413 - DELHI HIGH COURT]. This Court rejected the contention that the activity of the petitioner in pursuing complaints against various Chartered Accountants was otherwise permitted under its Memorandum of Association. This Court also observed that the use of a corporate façade of the petitioner by its directors/promoters for pursuing complaints against various Chartered Accountants, unconnected with its business, cannot be countenanced. In the present case, JMG had clearly stated in his response that he had retired from the firm of Chartered Accountants that was appointed to conduct the audit in view of disputes inter se the partners of the firm. He had also pointed out that the complaint had been made beyond the period of seven years and the Chartered Accountants were not required to maintain audit records for more than seven years - This Court finds no infirmity with the said opinion. Plainly, no interference with the opinion of the Board of Discipline is called for in proceedings under Article 226 of the Constitution of India, unless the same is perverse or so unreasonable that no sensible person could possibly arrive at such a view. The contention that since JMG had responded to the allegations after securing the audit papers, the same would preclude recourse to Rule 12 of the Rules, is unmerited. This Court is of the view that the present petition is a frivolous one and the filing of such petitions ought to be discouraged, as it takes up considerable judicial time at the cost of bona fide litigants who are in urgent need of relief - the present petition is dismissed with costs quantified at ₹1,00,000/-.
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