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Institute of Chartered Accountants of India Versus Ajit Kumar Iddya

2003 (1) TMI 726 - KARNATAKA HIGH COURT

Writ Appeal No. 761 of 2001 - Dated:- 14-1-2003 - N. K. Jain (CJ) And V. G. Sabhahit, JJ. JUDGMENT N. K. Jain, CJ. 1. The appellant-Institute of Chartered Accountants of India (for short the 'ICAI') has filed this appeal against the order dated 15-9-2000 passed by the learned Single Judge in W.P. No. 37189 of 1995. 2. The necessary facts in brief are that a complaint was filed by the 2nd respondent before the appellant alleging that the 1st respondent-petitioner accepted the statutory au .....

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s under the Chartered Accountants Act, 1949 (for short 'the CA Act') and his conduct was totally bona fide, and that the lapse, if any, was on the part of the company as it did not comply with the circular of the Company Law Board, and concluded that the 1st respondent-petitioner was not guilty of any professional misconduct under Clause (9) of Part I of the First Schedule to the CA Act, vide order dated 14-1-1994. A notice dated 13-2-1995 (An-nexure-D) was issued by the ICAI to the 1st .....

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, may send his representation in writing. The same was replied by the 1st respondent-petitioner vide Annexure-F, dated 22-3-1995 stating that as the Disciplinary Committee concluded that he is not guilty of any professional misconduct, he did not wish to appear in person or through a member of the Institute before the Council nor to make any written submission. Thereafter, the Council of ICAI conveyed its decision, vide order dated 18-9-1995. to the 1st respondent-petitioner stating that neither .....

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, learned Senior Advocate for the appellant submits that the 1st respondent-petitioner, despite notice, never appeared before the Council nor filed any written statement, and therefore, it was within the competence of the appellant to order for further enquiry and that the Council has power to do so and that the learned Single Judge misdirected himself and erred in approving the finding of the Disciplinary Committee ignoring the case-laws particularly the decision in Institute of Chartered Accou .....

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call for further enquiry, and therefore, the order of the learned Single Judge has to be set aside and further enquiry has to be conducted by the Disciplinary Committee. He relied on the decisions of the Supreme Court in Institute of Chartered Accountants of India v. L.K. Hatna and Ors., and in Price Water-house's case, supra. 4. On the other hand, Sri B.V. Acharya, learned Senior Counsel for the 1st respondent submits that even though the Council has power to do so, but once the Disciplina .....

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hat this Court has already held that sending communication through registered letter is not mandatory. Learned Counsel for the petitioner does not dispute the legal position that the Council is the ultimate authority and, if necessary, it can at any point of time remit the matter to the Disciplinary Committee for further enquiry, if some material is not considered by the Disciplinary Committee but certainly not in this case without coming to the conclusion that the Council is not agreeable to th .....

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tiation and despite the earlier directions of this Court, for one or other reason, the matter could not be finalised and the 1st respondent-petitioner is being harassed. Therefore, the learned Single Judge has rightly approved the decision of Disciplinary Committee and his order needs no interference. 5. As agreed, we have heard the learned Counsels for the parties, perused the materials on record and the case-laws at admission stage. . 6. It is not necessary to go into the details of the case-l .....

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iry relating to misconduct of members of the Institution and Section 22 with professional misconduct. So also, under Regulation 16(3) and (4) of the CA Act the Council can direct the Disciplinary Committee, which is a fact-finding authority to make further enquiry and submit report, if necessary. 7. So far as the cardinal law of interpretation is concerned, it is settled that if the language is simple and unambiguous, it is to he read with the clear intention of the legislation. Otherwise also, .....

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Committee comes to the conclusion that the Council is not competent to refer the matter for further enquiry is not acceptable for the reason that the Council is the final authority as per the provisions of the Act. The Apex Court has clearly interpreted and the principles enunciated have not been disputed by the learned Counsel for the respondent. Applying the settled position of law and the facts of the given case, on a perusal of the materials on record, it is revealed that the Disciplinary C .....

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ired, he may send any representation within one month from the date of the receipt of the notice. As the 1st respondent-petitioner did not appear in person nor any written submission was made and replied nor wished to make any submission as misconduct has not been held by the Committee, the Council by its order dated 18-9-1995 (Annexure-A) ordered for further enquiry. 9. What is to be seen is whether under the circumstances, the Council exercising its power to direct further enquiry was correct .....

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iry by the Disciplinary Committee without any observation as to non-acceptance of the report of the Disciplinary Committee is not tenable, even though the Council as the Controlling Authority has power. It is also settled proposition of law that it is not necessary to communicate the reasons. It is also settled that reasons cannot be supplemented by affidavits, but the same should be in original record. Nothing has been placed before this Court. As stated, the order does not disclose disagreemen .....

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