The Council Of The Institute Of ... vs Dinesh Kumar And Anr.
1991 Latest Caselaw 609 Del

JUDGMENT

D.P. Wadhwa, J.

(1) This is a reference made under Section 21(5) of the Chartered Accountants Act, 1949 (for short 'the Act') by the Council of the Institute to Chartered Accountant of India constituted under the said Act recommending that the respondent, a Chartered Accountant and a member of the Institute, be reprimanded for contravention of the provisions to Regulation 32B of the Chartered Accountants Regulations, 1964.

(2) The facts in brief are that the respondent bad employed Mr. Yatendra Singh as an articled clerk for a period from I October 1980 to 3 March 1982. The articled clerk complained to the Institute that he was not paid stipend by the respondent for all this period. The complaint is dated 31 March 1982. On this a notice was issued to the respondent on 14 April 1982. He replied by letter dated 21 April 1982 admitting that he had not paid the stipend due to the articled clerk but said that at the time of the engagement of the articled clerk his father had told the respondent that the whole of the amount of stipend might be paid in lump sum to the articled clerk on the termination of his engagement In this letter respondent also that he had since made whole of the payment to the articled cleric on 20 April 1982 amounting to Rs. 1.335.00 . The articled clear also wrote to the Secretary of the Institute for having received the payment and wanted his complaint io be withdrawn. The respondent also expressed regret for his conduct. Never the less, the complaint of the articled clerk was taken as "information" under section 21(5) of the Act, and under Regulation 1 1 (8) the Council was prima facie of the opinion that respondent was guilty of professional misconduct. The Council, therefore, in its meeting held on 23 and 24 December 1982 resolved to refer the matter to the Disciplinary Committee. This committee conducted detailed investigation in the matter and prepared its report on 12 September 1983 staling that there has been contravention of Regulation 23B of the Regulations and holding ther the respondent was guilty of professional misconduct within the meaning of section 21 read with section 22 of the Act and clause (i) of part Ii of the Second Schedule of the Act.

(3) Regulation 32B reads as under:- "(1)Every member engaging an articled clerk on or after 1st July 1973 shall pay to such clerk a minimum monthly stipend at the rates specified in sub-regulation (2) or in sub regulation (3) hereof, as the case may be. (2) xx xx xx xx (3) xx xx xx xx (4) The stipend under sub-regulation (2) or (3) hereof, as the case may be. shall be paid by the member to an articled clerk either (a) by a crossed account payee cheque every month against a .stamped receipt to be obtained from the articled clerk; or (b) by depositing the amount every month in an account opened by the articled clerk in his own name with a branch of the bank to be specified by the member."

(4) Under section 22 of the Act, the expression "professional misconduct" shall be deemed to include any act or omission specified in any of the Schedules. In part Ii of the second Schedule of the Act, professional misconduct is mentioned in relation to the members of the Institute generally requiring action by a High Court. It say that a member of the Institute, whether in practice or not, shall be deemed to be guilty of professional misconduct, if he contravenes any of the provisions of the Act or the regulations made there under.

(5) The Committee did not accept the explanation of the respondent and rejected his defense. Neither the articled clerk nor his father was examined during the course of proceedings before the Disciplinary Committee. The respondent also never wanted them to be examined. The Committee, therefore. held that the respondent had contravened the provisions of Regulation 32B inasmuch as be did not pay the stipend due to the articled clerk on a month to month basil.

(6) This report of the Disciplinary Committee of 12 September 1983 was for the first time communicated to the respondent in April 1987. To this the respondent sent a representation in May 1987. This was considered in the meeting of the Council held on 1 and 2 June 1987. The Council noted that on 1 June 1987 it had decided that such an infraction of the regulation may be treated only as a technical breach if the payment was made to the articled clerk before the date of the prima facie finding of the Council referring the matter to the Disciplinary Committee. Payment in this case was admittedly made before the meeting of the Council held on 23 and 24 December 1982. But then in view of the finding of the Disciplinary Committee, the Council did not think it necessary to treat the infraction as merely technical in the present case and recommended that the respondent be reprimanded. Accordingly, the matter was referred to this Court by the Council with its recommendation thereon under sub-section (5) of section 21 of the Act.

(7) Under sub-section (6) of section 21 of the Act, this Court after giving opportunity to the parties can (a) direct that proceedings be filed, or dismiss the complaint, as the case may be; (b) reprimand the member; (c) remove him from membership of the Institute either permanently or for such period as the High Court thinks fit; and (d) refer the case to the Council for luther inquiry and report.

(8) We have heard Mr. K. K. Jain, learned counsel for the Institute, and also Mr. Bishamber Lal, learned counsel to the respondent, in considerable detail and have also perused ihe record. We find that the Disciplinary Committee did make indepth study of the whole ease and thereafter made its report after giving full opportunity to the respondent This report was again considered by the Council consisting of as many as sixteen members and their deliberations would show that they applied their mind to the case in its proper perspective. We will not, 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.