Complainant using ICSI to recover alleged dues only a serious matter, need to be looked into

Complainant using ICSI to recover alleged dues only a serious matter and need to be looked into when he settled the dispute without informing Institute

ABCAUS Case Law Citation:
ABCAUS 3266 (2020) (02) AA

In the instant case, the Appellant was a practicing company secretary who had preferred an appeal before the Appellate Authority to challenge the legality and validity of Order passed by Board of Discipline (“BOD”) of the Institute of the Company Secretaries of India (ICSI) in finding the Appellant as guilty of Professional Misconduct under item (8) of Part-I of the First Schedule of the Company Secretaries Act 1980 (“the Act”).

By the impugned order, the Appellant was ordered to pay fine of Rs. 25,000/-(Rupees Twenty Five Thousand Only) and her name was removed from the Register of Members of the ICSI for a period of 30 days.

The Complainant had alleged that the Appellant had certified and filed Forms pertaining to Annual filings of three companies without first communicating with the Complainant as he had certified and filed the Forms for Annual filing for the said companies for the previous Financial Year.

The Complainant further averred that even after his objection, the Appellant continued to do the assignments. It was also alleged that the said companies had not paid him his ‘dues’ towards services rendered by him.

Despite issuance of letters/notices, neither the Complainant nor the Appellant put appearance before the BOD. Hence the impugned Order was passed ex-parte.

Before the Appellate Authority the Appellant urged that the matter was settled with the Complainant and he had given a withdrawal letter which could not be produced before BOD. Similar was the plea of the Learned Counsel for the claimant. It was stated that the claimant did not want to pursue the Complainant lodged by him against the Appellant as the matter stood settled.

The Appellate Authority observed that there were material contradictory versions given by both the Appellant and the Complainant regarding the settlement. Appellant’s plea was that before undertaking the certification work for these companies, she had sent a communication to seek NOC from the Complainant and when there was no response for 30 days, she had done the certification work.

On the other hand the complainant’s plea was that the Appellant had not communicated with her despite sending e-mails; did not take his calls and did the certification work without any communication to him.

The Appellate Authority opined that this controversy required to be resolved after getting evidence of the parties on the issue. Again there was controversy as to how and under what circumstances; the settlement was arrived at between the parties and what consequences it had.

However, the Appellate Authority recorded its displeasure about the conduct of the Complainant during the entire proceedings. The Complainant had lodged a comprehensive Complaint supported with several documents before the Institute. However, the appellant of his own without seeking any permission from the ICSI, he did not even bother to intimate the Institute about the alleged settlement. The Complainant having settled the dispute did not withdraw the Complaint; he did not opt to appear before the Institute during proceedings. There was no occasion for the Complainant to handover the withdrawal letter to the Appellant. It resulted in the passing of the impugned Order whereby in ex-parte proceedings, the Appellant was held ‘Guilty’ and was punished.

The Appellate Authority expressed serious concern over the action of the Complainant to settle the dispute without informing the Institute and to use the forum to recover his alleged ‘dues’ only as a serious matter and opined that it should be looked into by the Institute/BOD.

In view of the above, the impugned order was remitted to the Board of Discipline with direction to decide it by a reasoned order in the light of observations made by the Authority.

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