TMI Blog2013 (10) TMI 502X X X X Extracts X X X X X X X X Extracts X X X X ..... was the effect of this omission. Similarly, it is not pointed out what matters were not applicable, which were omitted by respondent No.1 and how and to what extent has it harmed the interests of the Company. It has also not been pointed out by whom and in what manner the Audit Report was proved. Witnesses examined during the course of inquiry are found to have been cross-examined by the members of the Disciplinary Committee and by the complainant. Such a procedure is unknown to Indian jurisprudence and it in our opinion vitiates the entire proceedings of the Disciplinary Committee, being contrary to the settled principles of natural justice that one cannot be a judge and a prosecutor at the same time - proceedings of the Disciplinary Committee are found to be based on no evidence and are even otherwise vitiated. The Council did not apply its mind to the facts and circumstance of the case, accepted the report of the Disciplinary Committee in a mechanical manner and has made this reference to this Court - Disciplinary Committee is found to have observed that the proceedings could not continue in the absence of Registrar of Companies. However, the Registrar of Companies never part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Schedule read with Sections 21 and 22 of the Act." The Council, in its meeting held on 4th, 5th and 6th of August, 2010, considered the report of the Disciplinary Committee and noticed that the Disciplinary Committee had held respondent No.1: "(a) Not guilty of professional misconduct with respect to charges as mentioned in para 1.2.3, 1.2.4, 1.2.5 (to the extent mentioned in para 23), 1.2.6 and 1.2.7 of the Report. (b) guilty of professional misconduct with respect to charges as mentioned in paras 1.2.1 and 1.2.2 of the Report falling within the meaning of Clause (8) of Part I of the First Schedule read with Sections 21 and 22 of the Chartered Accountants Act, 1949. (c) guilty of professional misconduct with respect to charge as mentioned in para 1.2.5 (to the extent mentioned in para 23.1) of the Report falling within the meaning of Clause (7), (8) and (9) of Part I of the Second Schedule read with Sections 21 and 22 of the Chartered Accountants Act, 1949." The Council then decided to afford an opportunity of hearing under Section 21(4) of the Act, to respondent No.1 before passing orders against him as regards charges at Serial No.(b) above while in res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditto copy of each other with each word, line, stanza, comma and full stop and the language adopted in the report being the same. Even the type and style of printing is the same. Even the number of paragraph covered in both the reports is the same number of paragraph reporting only on 12 matters of the Manufacturing and other Companies (Auditors Report) Order, 1988. The place of signing of both the reports is "Ludhiana" whereas Shri Vijay Kumar does not have any office in Ludhiana." The Disciplinary Committee dealt with this charge in two parts. The first part is dealt in para 23 and it has been held that respondent No.1 is not guilty of this part of the stated misconduct. As regards the second part, para 23.1 of report of the Disciplinary Committee reads as under: "23.1 Further, as regard the sub-charge in the para 1.2.5 that the Respondent failed to give the Auditors report as required by the Companies Act, 1956, the Committee noted that the Auditors' Report should be in the prescribed manner as per the MAOCARO, 1988 of the Companies Act, 1956 and every Auditor is required to comment on all the matter included in the said report. Further, if a matter is not applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent No.1 is not shown to have been served a notice of hearing by the Disciplinary Committee. The entire proceedings have been carried out at his back. Rather, the Disciplinary Committee is found to be endeavouring to know address of respondent No.1 during the course of enquiry as the complainant was repeatedly questioned about address of respondent No.1. Further the witnesses examined during the course of inquiry are found to have been cross-examined by the members of the Disciplinary Committee and by the complainant. Such a procedure is unknown to Indian jurisprudence and it in our opinion vitiates the entire proceedings of the Disciplinary Committee, being contrary to the settled principles of natural justice that one cannot be a judge and a prosecutor at the same time. It also needs to be pointed out that the complainant, Amarjit Kamboj, undisputedly was biased against respondent No.1, because of his having been replaced as Auditor of the aforesaid Company by respondent No.1. Therefore, version put forth by said Amarjit Kamboj could not be accepted to be free from embellishment and could not be relied upon in the absence of independent corroboration, which is conspicuously m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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