COUNCIL OF INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA Vs. R.K. TAYAL
HIGH COURT OF DELHI
COUNCIL OF INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
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V.B.GUPTA, J. -
(1.) PRESENT reference has been made to this Court under s. 21(5) of the chartered accountants Act, 1949 read with Chapter
7F of the Delhi High Court Rules. behalf of the respondent No. 1, R.K. Tayal and arguments were heard.
(2.) AS per statement of the case, Sh. Thampy Mathews, DGM, Industrial Investment Bank of India, New Delhi filed a complaint against respondent No. 1. The complainant -bank had sanctioned a term loan of Rs. 630 lakhs to Haryana
Steel & Alloys Ltd., Sonipat, Haryana ('the Company') for its expansion -cum -modernisation project. As per terms and
conditions of sanction, the company was to bring in 100 per cent of the promoters' contribution (Rs. 270 lakhs) by way
of internal accruals and actually bring in at least 50 per cent of the same. While requesting for disbursement of the
sanctioned amount, the company stated that it had already spent Rs. 147.21 lakhs for the project till that time and in
support thereof, the company submitted a certificate dt. 10 -2 -1998 issued by the respondent No. 1 stating that the
company has already spent Rs. 147.21 lakhs for the project till that time including an amount of Rs. 6.61 lakhs paid to
the complainant bank.
(3.) BASED on the aforesaid certificate of respondent No. 1, the complainant -bank disbursed an amount of Rs. 315 lakhs in two instalments to the company being 50 per cent of the sanctioned amount and advised it to submit a utilisation
that the funds were utilised by the company out of the loan of Rs. 315 lakhs received from the complainant -bank. In the
said certificate, a sum of Rs. 6.61 lakhs has also been shown as amount paid to the complainant -bank for upfront fee,
while the said amount was received from the funds inducted by the promoters before disbursement of the said loan. It
has been further alleged in the complaint that sum of Rs. 12,55,117 and also Rs. 7,25,348 had been paid to the
Against the aforesaid background, the allegations made against the respondent No. 1 as per complaint, are as under :
(ii) The said certificates did not reflect the end use of the funds."
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