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ABCAUS Excel for Chartered Accountants

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Chartered Accountants

The Delhi High Court has quashed the disciplinary proceedings of ICAI for alleged professional misconduct against a chartered accountant on account of inexcusable delay. The Court delivered its judgment on 03/11/2014 while disposing off the Writ Petitions WP(C) 2213/2013 and CM 4199/2013. The petitioner, a Delhi based chartered accountant, had prayed the quashing of the disciplinary enquiry against the petitioner/petitioner’s firm on account of delay. The chartered accountant had been  alleged to have committed professional mis-conduct to solicit any business or to advertise his personal attainment through an advertisement in respect of his firm published in the “Accountancy Journal” published by the Institute of Chartered Accountants of England and Wales, in United Kingdom.

The important excerpts from the judgment of the Delhi High Court are as under:

“The offending advertisement was published in August 1996, the disciplinary proceedings were effectively commenced in 1997 and the report of the Disciplinary Committee was finalized almost four years later in 2001. The proceedings are now sought to be revived, 12 years later. There is also no explanation offered for this delay and in my view this delay cannot but be termed as inexcusable.”

“The right for a speedy adjudication is equally applicable as the same is a facet of fairness which has been read into Article 21 of the Constitution of India. Indisputably, the petitioner would have the right for the speedy conclusion of proceedings initiated against him which by their nature are prejudicial to him.”

“Secondly, the delay has to be viewed in the context of other factors that may have resulted in the delay such as the workload, number of witnesses/accused, the complex nature of the offence or evidence required etc. The charge in the present case is neither complex nor required any extensive evidence…………..the inexcusable delay of over 11 years clearly violates the right of the petitioner for a speedy disposal.”

“There is yet another aspect that needs to be considered. The purpose of disciplinary proceedings is to ensure that the members conform to the code of conduct as prescribed during the member’s professional working life. This object would be completely defeated and would lose its relevance"

"if disciplinary proceedings were to span decades. In the present case, the petitioner has continued to practice as a Chartered Accountant and as a member of ICAI for over 17 years after the alleged misconduct. In the circumstances to now proceed further to take a punitive action for an alleged misconduct done 18 years ago would hardly be meaningful.”

The Delhi High Court also quoted an earlier decision of its Division Bench in  The Council of the Institute of Accountants of India, New Delhi v. Dinesh Kumar and Anr.: 1991 (21) DRJ 238. In the said case the Delhi High Court, without even going into the merits of the findings of the Disciplinary Committee had directed that the proceedings be filed on account of a delay of four years.

The extract of the judgment in the aforesaid case was quoted again by the court as under:-

“Therefore, for a moment question the findings and bonafides of the Disciplinary Committee which was accepted by the Council. But than we find there has been a great deal of delay by the Council in not acting upon the report to the Disciplinary Committee. They delay is almost for a period of four years which has remained unexplained.

There is nothing on record to show as to why it took almost four years for the Council to deliberate upon the report of the Disciplinary Committee and, thus, keep the matter banging to the extreme prejudice of the respondent. Mr. Jain was at pains to explain that due to huge pendency of work with the Council it did not get time to consider the report of the Disciplinary Committee. Such an Explanation is just stated to be rejected. A case like the present one where there is a charge of misconduct against a professional has to be disposed of with utmost expedition. The approach, in the present case, of the Council appears to us to be rather lackluster and the delay inexcusable. We are told that all these years respondent has not been able to get any work of public undertakings and other institutions because of pendency of the disciplinary proceedings. We have noted above, the Council itself had resolved on I June 1987 to treat such an infraction merely as technical. It is not disputed before us that whole of the payment has since been made to the articled clerk by the respondent. The complaint was made on 31 March 1982 and as the sequence of events narrated above would show the Council could meet only on I and 2 June 1987 to consider the report of the Disciplinary Committee of 12 September 1983. We find that there have been too much aches in the case, and in the circumstances of the case we will direct that the proceedings be filed. We make no order as to costs”

 

Download Full Judgment Click Here to Read >>

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Delhi High Court quashes ICAI Disciplinary Proceedings for alleged Mis-Conduct against Chartered Accountant/CA Firm for Inordinate and Inexcusable Delay

The right for a speedy adjudication is equally applicable as the same is a facet of fairness which has been read into Article 21 of the Constitution of India

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