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TMI Blog2011 (8) TMI 972X X X X Extracts X X X X X X X X Extracts X X X X ..... ctor of the company. The Disciplinary Committee recorded that as per rule before engaging himself in any commercial activities he should have verified that in fact the permission had been granted. appellant was guilty of professional misconduct for violating the provisions of Clause 11 of Part-II of First Schedule read with section 190(A) of the Regulations X X X X Extracts X X X X X X X X Extracts X X X X ..... as its Benami Director. 3. The institute decided to conduct an enquiry into the complaint and consequently entrusted the matter to Disciplinary Committee, which after hearing the appellant submitted its report dated 29-12-1994 which inter alia found the appellant to be innocent of all the charges except professional misconduct within the meaning of Clause 11 of Part-I of First Schedule of the Act. The appellant submitted his representation against the said report dated 29-12-1994 to the Council of Institute of Chartered Accountants of India (for short 'the Council') which after consideration of the report and the written as well as oral submissions of the appellant accepted the report of Disciplinary Committee and found the appellant guil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and construction activities. He admitted that he had been signing cheques on behalf of the company and also stated that it was in the absence of the Executive Director who was other signatory for the operation of the bank accounts. He averred that his mere signing of cheques would not make him a "Working Director". He also averred that in his application dated 1-6-1987 whereby he sought permission of the Institute, he had stated that his relatives will have substantial interest to the tune of 20 per cent in the said company. He averred that he had sought the permission and dispatched the same vide letter dated 20-6-1987. He averred that he also sent another letter dated 14-3-1994 to the Institute. He further averred that he bonafidely bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ours a week and that he was not engaged in any sale, purchase or commercial activities. The appellant consequently prayed for setting aside the decision dated 4-7-1998 of the institute. 5. Before us, none appeared for the appellant despite long passovers. We, thus, proceeded to hear the learned counsel for the respondent No. 1. We have perused the record including the report dated 29-12-1994 of the Disciplinary Committee. The matter was finally heard by the Disciplinary Committee on 12-3-1994 which was attended by the appellant along with his counsel. The Council perused the statement of the respondent made before the Committee. The appellant stated that in April, 1987 he had discussions with respondent No. 2 for starting business of a bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding the said letter to the Institute. In reply thereto, the appellant stated having sent the same by ordinary post. The Disciplinary Committee has recorded that after the hearing was concluded, the appellant vide his letter dated 14-3-1994 informed about having dispatched the said letter on 23-6-1987. The Disciplinary Committee further records that although the appellant in the said letter dated 14-3-1994 had stated about his enclosing photocopy of the dispatch register along with it, no such enclosure was received. In an answer to a question the appellant had also admitted before the Disciplinary Committee that he used to arrange loans for the company from the banks. In an answer to another question, he admitted that substantial paper wor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantially involved in the managing of affairs of the company though not designated as Managing Director or whole-time Director. The Disciplinary Committee report records that the appellant was guilty of professional misconduct for violating the provisions of Clause 11 of Part-II of First Schedule read with section 190(A) of the Regulations. We do not find any infirmity or illegality in the said decision of the Disciplinary Committee. 7. The Council considered the report of the Disciplinary Committee and also representation made by the appellant and vide its decision dated 4-7-1998 accepted the report of the Disciplinary Committee and found the appellant guilty of professional misconduct within the meaning of Clause 11 Part-I of First Sch ..... X X X X Extracts X X X X X X X X Extracts X X X X
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