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TMI Blog2015 (5) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... appear “even after one adjournment, the reading out of charge or charges along with the summary of prima facie opinion shall be made in his absence”. This, clearly, indicates that it would be necessary for the Disciplinary Committee to at least grant one adjournment on account of non appearance of the concerned member. It is also important to note that under Rule 18(9) of the Rules if the concerned member does not enter the plea of guilty, the Disciplinary Committee would fix a date for examination of witnesses and production of documents. Admittedly, in the present case the charges alongwith summary of prima facie opinion were not read as required under proviso to Rule 18(7) of the Rules. Rule 18(13) of the Rules indicates that after the Director has presented the evidence against the concerned member, he was to be called upon to enter his defence and produce his evidence. A perusal of the notes of the hearing held on 25.11.2011 indicate that the entire procedure was compressed in a single hearing as the petitioner was absent on that date. As the petitioner has an equally efficacious remedy of appeal under Section 22G of the Act. Undoubtedly, the petitioner would have an equal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f professional misconduct under clauses (7), (8), and (9) of Part I of second schedule to the Chartered Accountants Act, 1949 (hereafter the Act ). 3.2. The prima facie opinion of Director (Discipline), ICAI dated 04.05.2010 was considered by the Disciplinary Committee and by letter dated 09.08.2010 the petitioner was called upon to submit his written statement within 21 days. At the request of the petitioner, the time to file the written statement was initially extended to 30.09.2010 and again to 15.10.2010. However, no such written statement was filed by the petitioner. 3.3. By letter dated 08.12.2010, petitioner was called upon for personal hearing before the Disciplinary Committee on, 26.12.2010, at the office of ICAI, Kolkata. By letter dated 16.12.2012 - which was received by the Disciplinary Committee on 21.12.2010 - the petitioner requested for an adjournment on the ground that he would be travelling out of station on 26.12.2010. This request for adjourning the hearing scheduled on 26.12.2010 was declined. 3.4. Thereafter, the hearing of the Disciplinary Committee was fixed on 25.11.2011 at the office of ICAI, Kolkata and the petitioner was informed of the same by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Disciplinary Committee did not entertain the petitioner s request for an adjournment on either of the two occasions. 9. A perusal of the notes of hearing also indicates that the Director (Discipline) had stated before the Disciplinary Committee that Earlier the case was fixed on December 2010 and it was adjourned at his request . Apparently, the said statement was made to persuade the Disciplinary Committee to reject the petitioner s request for adjourning the hearing. It does appear that the decision of the Disciplinary Committee to decline the petitioner s request for an adjournment was influenced by the statement made by the Director (Discipline), as the President of the Disciplinary Committee had immediately thereafter recorded his decision to go ahead with the proceedings ex-parte. 10. It is not in dispute that the statement made by the Director (Discipline) was not accurate as the petitioner s request for an adjournment of the hearing scheduled on 26.12.2010 had not been acceded to and was rejected by a letter dated 22.12.2010. In the circumstances, one can safely deduce that the Disciplinary Committee proceeded on the erroneous assumption that the petitioner had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pporting documents, if any. (6) The Presiding Officer of the Committee shall fix a date, hour and place of hearing, which shall not ordinarily be later than 45 days from the date of receipt of prima facie opinion and the committee shall cause a notice to be sent of such date, hour and place to the Director, respondent and complainant and require them to appear before it in person to make oral submissions, if any. Explanation. - For the purpose of this rule the appearance includes, unless and otherwise directed, appearance by an advocate or through any authorized representative, who may be a Chartered Accountant, Cost Accountant or Company Secretary. (7) During the first hearing, the Committee shall read out the charge or charges to the respondent along with the summary of prima facie opinion arrived at by the Director, and ask the respondent whether he pleads guilty to the charge or charges made against him : Provided that if the respondent does not appear for the first hearing even after one adjournment, the reading out of charge or charges along with the summary of prima facie opinion shall be made in his absence and the case proceeded with in accordance with the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the evidences and arguments produced before it and arrive at a finding on whether the respondent is guilty or not of any professional or other misconduct. (18) The Committee may, at the request of any of the parties before it or due to other reasons, and on such terms as it thinks fit, and at any stage of the proceedings, adjourn the hearing : Provided that such adjournment shall not be given more than once at any stage of the proceedings. Explanation. - For the purpose of this rule, inability of the complainant, advocate, authorized representative or witness, to appear shall not be treated as a valid reason for adjournment of a hearing. 13. A plain reading of Rule 18(1) of the Rules indicates that the Disciplinary Committee is to be guided by the principles of natural justice. Rule 18(7) of the Rules indicates that at the first hearing, the Disciplinary Committee is to read out the charge or charges to the respondent alongwith a summary of the prima facie opinion arrived at by the Director and ask the concerned member whether he/she pleads guilty of the charges. The proviso to Rule 18(7) of the Rules indicates that if the concerned member does not appear even aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r and complexion of the proceeding considered in conjunction with the structure of power constituted by the Act which leads us to the conclusion that the member is entitled to a hearing by the Council before it can find him guilty. Upon the approach which has found favour with us, we find no relevance in James Edward Jeffs and Ors. v. New Zealand Dairy Production and Marketing Board and Ors. [1967] 1 AC 551 cited on behalf of the appellant. The Court made observations there of a general nature and indicated the circumstances when evidence could be recorded and submissions of the parties heard by a person other than the decision making authority. Those observations can have no play in a power structure such as the one before us. 15. Although, there have been significant amendments in the procedure for disciplinary proceedings, the above observations made by the Supreme Court clearly establish that the nature of disciplinary proceedings make it imperative that sufficient opportunity be provided to the concerned member before pronouncing him guilty of misconduct. A bare perusal of Rule 18 of the Rules also indicates that the framers of the rules were conscious of the implications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciplinary proceedings and held as under:- 33. Since in the instant case the appellant was not provided any subsistence allowance during the period of suspension and the adjournment prayed for by him on account of his illness, duly supported by medical certificates, was refused resulting in ex parte proceedings against him, we are of the opinion that the appellant has been punished in total violation of the principles of natural justice and he was literally not afforded any opportunity of hearing. Moreover, as pleaded by the appellant before the High Court as also before us that on account of his penury occasioned by nonpayment of subsistence allowance, he could not undertake a journey to attend the disciplinary proceedings, the findings recorded by the enquiry officer at such proceedings, which were held ex parte, stand vitiated. 19. In State Bank of India v. Chandra Govindji: (2000) 8 SCC 532 , the application for adjournment filed on the ground of medical illness of the counsel was rejected by the Rent Controller. On appeal, the High Court observed that earlier also reasonable opportunities were granted, however, the appellant (therein) had failed to avail those opportun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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