COUNCIL OF THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA Vs. C.H. PADLIYA

JUDGEMENT

(1.) THIS is a reference by the Council of the Institute of Chartered Accountants of India under section 21(5) of the Chartered Accountants Act, 1949 (hereinafter referred to as the Act) with its recommendation to this Court that Shri C.H. Padliya, a chartered Accountant of Indore (hereinafter referred to as the respondent) be reprimanded on the ground that the respondent has allowed his Articled clerk Shri Vijaykumar Gupta to engage himself in other employment during the period of his articles commencing from 1 -9 -1969 to 31 -8 -1971, without taking prior permission of the Council under Regulation No. 36 of the Chartered Accountants Regulations, 1964 (hereinafter referred to as the Regulations).

(2.) FACTS that gave rise to this reference which lie in a short compass may briefly be stated. The Council of the Institute of Chartered Accountants of India received information that the respondent Shri C.H. Padliya had allowed his articled clerk Vijay Kumar Gupta to engage himself in the employment of Liberty Insurance Company Ltd. Indore on a full time basis during the period of articles from 1 -9 -1969 to 31 -8 -1971. The Secretary of the Council by his letter dated 9 -10 -1972 conveyed this information to the respondent and called upon him to send his written statement, if any, as required by Regulation 11 (6) of the Regulations. The respondent submitted his written statement to the Council on 27 -11 -1972 to the effect that Vijay Kumar Gupta was serving with him as Articled clerk during the period in question, that he was devoting his full time in his office and attending the audit work during the period of his training, that he never disclosed that he was employed in the Liberty Insurance Company Ltd. Indore or anywhere else, that the office of the Liberty Insurance Company Ltd. Indore is situated in the separate portion of the building and the entrance of the same is from different street from that of his office and that he was neither aware of nor had knowledge of the fact whether Vijay Kumar Gupta was serving with the Liberty Insurance Company Ltd. and, therefore, requests the Council to treat the matter as closed.

(3.) SHRI S.N. Kohli, learned counsel for the applicant contended that the Disciplinary Committee and the council constituted by eminent professional men have found that the respondent was aware of the employment of his Articled clerk Vijay Kumar Gupta in Liberty Insurance Company Ltd. and he should not have allowed his clerk to engage himself in other employment during the period of his articles without prior permission of the council and these findings should not be interferred with by this Court as they are the best Judges of what their own standard of professional conduct should be and the respondent has committed professional misconduct as knowledge about the other employment of his clerk must be inferred from the facts and circumstances of the case, coupled with his conduct in not intimating the Council about this irregularity by himself before he was called upon to submit his written explanation. This claim of the Council is resisted by Shri K.A. Chitale, learned counsel for the respondent contending inter alia that this Court has ample power and jurisdiction to set aside the findings of fact arrived at by the Disciplinary Committee and the Council if they are illegal or erroneous or violative of principles of natural justice or violative of the provisions of the Act or Regulations made there under and the material findings of the Committee and the Institute are not supported by legal evidence and they are vitiated by wrong assumptions of fact and law and the onus of proof was wrongly shifted to the respondent and the proof must be one akin to a criminal prosecution and the Institute has not proved professional misconduct of the respondent beyond reasonable doubt and, therefore, this Court should direct the dismissal of the complaint in the present case. In reply, Shri Kohli asserted that the proceedings under the Act in respect of a professional misconduct of an Accountant is only a quasi -judicial nature and the onus of proof applicable to a civil proceeding only can be applied in the instant case and the proceeding cannot be held to be a prosecution of any kind nor is it similar to the one under the Legal Practitioners Act and, therefore, the decision arising under the criminal prosecutions and the Legal Practitioners Act have no application to the case in hand.