Chartered Accountants shall be guilty of misconduct on bringing disrepute to the profession whether or not related to his professional work – Supreme Court over rules Delhi High Court judgment
ABCAUS Case Law Citation:
ABCAUS 2648 (2018) (11) SC
In 2016, the Hon’ble Delhi High Court had held that when a chartered accountant was acting as an individual in his dealings with the complainant which were pure commercial and was not discharging any function in relation to his practice as a Chartered Accountant, he could not be said to be unbecoming , guilty of “other misconduct” as contemplated by Sub-Section (1) of Section 21 of the Chartered Accountants Act, 1949.
The High Court had dismissed the reference made by the ICAI and quashed the removal of CA’s name from the Register of Members.
However, the ICAI had taken up the case with the Hon’ble Supreme Court by filing a SLP.
The Hon’ble Supreme Court opined that the High Court had not correctly appreciated Section 21(3) of the Chartered Accountants Act, 1949.
The Hon’ble Supreme Court observed that the Disciplinary Committee of ICAI had, on facts, found the Chartered Accountant guilty of a practice which was not in the Chartered Accountant’s professional capacity. The Council was entitled to do so under Schedule I Part-IV sub clause (2) if, in the opinion of the Council, such act brings disrepute to the profession whether or not related to his professional work.
The Hon’ble Supreme Court held that the impugned judgment of the High Court was incorrect set aside the same. The matter was remanded to the High Court to be decided afresh.