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TMI Blog2013 (10) TMI 502X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the register of members of the Institute for a period of three months. Case of the Institute proceeds on the premises that one Amarjit Kamboj, who was Auditor of M/s Bacchus Enterprises Limited (hereinafter referred to as 'the Company') and was replaced by respondent No.1, made a complaint dated 08.10.2001 against respondent No.1 levelling various allegations against him. The Council, constituted under Section 9 of the Act, in its meeting held on 21/22.01.2005, found respondent No.1 prima facie guilty of professional and/or other misconduct and, accordingly, as envisaged by Section 21 of the Act, referred the matter to the Disciplinary Committee constituted under Section 17 of the Act. Disciplinary Committee, vide its report dated 03. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 respect of charge at Serial No.(c) above, it decided to recommend to this Court that name of respondent No.1 be removed from the Register of Members for a period of three months. This is how the instant reference has been made by the Institute in terms of sub-section (5) of Section 21 of the Act. In response to the notice, respondent No.1 has put in appearance through his counsel, Shri R.S. Athwal, Advocate, but has chosen to argue the matter w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two counts mentioned at Serial Nos.(b) and (c) in the extract of the minutes of the meeting of the Council held from 4 to 6th of August, 2010. The misconduct at Serial No.(b) is not the subject matter of the instant reference. Charge 1.2.5, of which respondent No.1 has been found guilty by the Disciplinary Committee and the Council, reads as under:- "1.2.5 The auditors report for the year ending 31st March, 1998 and 31st March, 1999 is a 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sconduct falling within the meaning of Clause (7), (8) and (9) of Part I of Second Schedule to the Chartered Accountants Act, 1949." Before proceeding further it may be stated that provisions of Section 21 of the Act being penal in nature, it is necessary that misconduct of a member of the Institute is established with certainty if not beyond reasonable doubt, before such a member is penalized under this Section. However, record of the case shows that proof of misconduct of the respondent No.1 with certainty apart, there is no evidence to substantiate it. A perusal of the record shows that the Company, whose Audit Report is stated to have been prepared by respondent No.1 contrary to the prescribed norms, has not made any complaint against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re 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 corroborat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed into a compromise with the auditors' company. Proceedings of the Company Law Board are available at page 273 of the paper book and it reads as under:- "In terms of the order dated 17/02/06 the Respondents having paid Rs.9.10 Lacs in various Instalments and have today deposited pay order for Rs.12.90 Lacs out of the balance of Rs.22.00 Lacs to the petitioners. Since full payment of Rs.22.00 Lacs has been made. All the shares held by the petitioner group will vest in Sh. Vipan Gupta, the son of respondent with immediate effect and Company is authorized to ratify its register of members accordingly without any further order. Petitioner submit that there are complaints and suits and the sam ..... X X X X Extracts X X X X X X X X Extracts X X X X
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