ICAI Appellate Authority reduces life ban to 10 years on CA punished in Satyam Case for Life to 10 years
ICAI Appellate Authority reduces life ban on CA Srinivas Talluri punished for involvement in Satyam case from Practising for Life to 10 years.
In 2018 Securities and Exchange Board of India (SEBI) had carried out an investigation into the affairs of Satyam Computer Services Limited (SCSL). The then Chairman of SCSL had admitted and confessed large scale financial manipulations in the books of account of SCSL.
The board of Price Waterhouse Coopers International Limited (PwC) had approved various CA firms as their partners to use the name ‘Price Waterhouse’ in India. CA partners/employees in any of said eleven firms were involved in the audit of SCSL in which Price Waterhouse was appointed as auditor.
The auditors’ report, balance sheets and profit and loss account of SCSL for the period April 2007 to September 2008 were signed by CA Srinivas Talluri.
SEBI has barred entities/firms practicing as Chartered Accountants in India under the brand and banner of PW, from issuing any certificate of audit of listed companies, compliance of obligations of listed companies and intermediaries registered with SEBI. Further, among others CA Srinivas Talluri, was directed not to issue any certificate of audit of listed companies, compliance of obligations of listed companies and intermediaries registered with SEBI. CA Srinivas Talluri alng with others were also made liable to disgorge the wrongful gains made.
Subsequently matter travelled to ICAI and disciplinary proceedings were initiated.
In terms of the provisions of Section 21B(3) of the Chartered Accountants Act, 1949 read with Rule 18(17) of the Chartered Accountants (Procedure of Investigations of Professional and Other Misconduct and Conduct of Cases) Rules, 2007, the Disciplinary Committee has held CA. Srinivas Talluri (Membership No. 029864), Flat No. 4B, Macherla Apartments, 6-3-1218/6, Umanagar, Begumpet, Hyderabad 500016 (Telangana), guilty of Professional Misconduct falling within the meaning of Clauses (5), (6), (7), (8) and (9) of Part I of Second Schedule to the said Act
Consequently, after affording an opportunity of being heard in terms of Rule 19(1) of the aforesaid Rules, ordered for removal of name of CA. Srinivas Talluri (Membership No. 029864) permanently from the Register of Members and also imposed a Fine of Rs. 5,00,000/-(Rupees Five Lakhs only) to be paid within 30(Thirty) days.
Aggrieved by the Order of the Disciplinary Committee the Respondent filed an appeal no 01/ICAI/2014 before the Appellate Authority under Section 22G of the aforesaid Act. Since the Appellate Authority was not functional at the relevant time, he also filed a Writ Petition WP(C) 2712/2014 before the Hon’ble High Court of Delhi in which The Hon’ble High Court vide order dated 30th April, 2014 granted interim stay till the disposal of Appeal by the Appellate Authority.
The Appellate Authority after hearing the parties vide its Order dated 25th March, 2025 reduced the period of removal from life ban to 10 years.
The factors which weighed with the Appellate Authority while deciding on the quantum of the punishment were as under:
that the Appellant was incharge and signing partner on behalf of the Price Watehouse for a brief period and thus could not have been privy to the size and scope of the fraud that was perpetuated upon the shareholders amongst other persons.
In 2009 when the fraud was disclosed, the Appellant was a young professional, who was aspiring for success in his career and would not have questioned or doubted the word of the key managerial personnel of Satyam, who were persons of immense stature at that time. At best, the Appellant appeared to be guilty of having trusted senior officials who were well aware of their ill actions and intentions instead of exercising professional scepticism required to identify potential risks, errors or fraudulent conduct.
The CA had suffered enough penal consequences, including having suffered incarceration for a substantial period of time. The present proceedings have also been pending since 2014, i.e., a period of over one decade, during the course of which the Appellant has suffered both professionally, financially and otherwise. Thus, the Appellant CA had suffered the consequences of his poor judgement and actions and now in the twilight years of his life, he ought to be allowed some relief from the rigors of the present proceedings
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