Cost Accountant misconduct for claiming Bogus TA Bills. Appellate Authority stayed the punishment due to lack of enquiry and examination by the Disciplinary Committee
The allegation against the guilty cost accountant was levelled by another cost accountant alleging defalcation of funds of Eastern India Regional Council (EIRC) of the Institute by submitting false claims in violation of the TA/DA rules of the Institute including the claims of taxi bills on the same dates from EIRC as well as Headquarter.
ABCAUS Case Law Citation:
ABCAUS 2306 (2018) (04) AA
Cost Accountant misconduct for claiming Bogus TA Bills
The instant appeal was filed by a Cost Accountant against the order passed by the Disciplinary Committee (DC) of the Institute of Cost Accountants of India (the Institute) who had found the appellant cost accountant guilty of Professional and Other Misconduct under the First Schedule and Second Schedule to the Cost and Works Accountants Act, 1959 (“Act”).
The punishment awarded to the appellant cost accountant comprised of reprimand, refund of the entire amount of Rs. 61,461/- to EIRC of the Institute plus equivalent amount as fine and removal of the name of the guilty cost accountant from the Register of Members for a period of one year.
The Disciplinary Committee investigated the complaint in accordance with the provisions of the Act and the Rules and accordingly the appellant cost accountant was asked to appear before it on various occasions for making submissions in his defence. However, he did not appear before the Committee except once when he stated that he would not like to submit anything. Though, the charges against him were read out, he left the said meeting without making any submission in his defence.
The Appellate Authority (AA) observed that the allegation was with respect to defalcation of funds of EIRC of the Institute in connection with the ICWAI Diamond Jubilee Conference organized by the Eastern India Regional Council for which an advance amount of Rs. 50,000/- was admittedly taken by the cost accountant and the adjustment of the said amount was given through vouchers.
The appellant argued that all the claims made by the Appellant are in order and the same have been approved by the competent Authority of the Institute and only thereafter the same has been adjusted by the accounts department of the Institute. Further, he submitted that the whole disciplinary enquiry conducted in this matter was against the provisions of the applicable Law and the procedure prescribed for the purpose of enquiry in the matter of professional or other misconducts by the Disciplinary Committee.
Additionally, it was also submitted that the Disciplinary Committee of the Institute even had not mentioned that under which specific clause of the First or the Second Schedule, the action of the appellant constituted as a professional or other misconduct and therefore, the Disciplinary Committee had simply make a sweeping remark in its aforesaid Order the appellant was guilty under the First and Second Schedule of the Act. Furthermore, it was also submitted that no evidence at all had been led to prove facts by holding a statutory trial as prescribed before holding the appellant guilty and the Disciplinary Committee had only placed reliance on the facts of the matter without proving and corroborating them with the necessary evidences by way of at least examining the necessary witnesses in this matter in terms of Rule 18(9), 18(10), 18(11), 18(12) and 18(13) of the Cost and Works Accountants (Procedure of Investigation of Professional and Other Misconduct and Conduct of Cases) Rules, 2007 and therefore, nor any witness had been examined neither a chance of cross examination was offered to the appellant.
The Appellate Authority noted that the Disciplinary Committee had neither recorded any evidence nor any person had been examined as a witness. However, an officer was abacus.in deputed to the hotel to enquire about the veracity of the factum of holding the said programme but even the said officer was also not examined as a witness in the matter
The Appellate Authority opined that the Disciplinary Committee of the Institute at least should have examined the representative of the Hotel, in addition to the officer concerned of the accounts department of the Institute, who had cleared the aforesaid bills as well as the Officer of the Institute who had made an enquiry in the matter, as a witness, and after providing an opportunity to the appellant herein for cross examining them, before finally deciding the matter.
Therefore, considering the non-observance of the established procedure to be followed by the Disciplinary Committee of the Institute, the Appellate Authority stayed the operation of the punishment order passed by the Disciplinary Committee till the completion of the directions for which the matter was remanded to the Disciplinary
Committee for undertaking the proceedings for enquiry, examination and cross examination and to pass a fresh Order.