ICAI penalised by Appellate Authority for Rs.50,000

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1. The Appellate Authority (AA) has imposed the Rs.50,000 cost to the Institute of Chartered Accountants of India ( ICAI ) for granting additional time to conclude the proceedings. The AA also granted a period of two months to conclude the proceedings pending before DC and directed to remit the amount within a week.

2. The Authority had remanded these appeals and the Disciplinary Committee (DC) was directed to dispose of the cases within 6 months from the receipt of the order.

3. The outer limit for disposal of the matter pending before the Disciplinary Committee expired on 01.05.2019. The DC did not proceed with the matter; no extension was sought from the Appellate Authority. The DC issued notice to the non-applicant after the expiry of the period of 6 months on 08.07.2019.

4. Learned Counsel for the non-applicant urged that the proceedings initiated by the DC are in violation of the direction of this Authority. DC was grossly negligent in not complying with the directions. The non-applicant had moved an application before the DC raising a preliminary legal objection, but it was not taken note of. The non-applicant was not given a reasonable opportunity of being heard and in a hurry, the DC passed an order holding the non-applicant ‘guilty’.

5. The said order is non-est in law and DC had no jurisdiction to adjudicate the matter. In the application, it is informed by the Institute that as the DC at the relevant time was committed with certain important cases of national interest, the proceedings could not be initiated in terms of order dated 01.11.2018. After the issuance of the notice, several dates of hearings were scheduled but on all dates except one, the applicant sought adjournments.

6. The Coram includes chairperson, Justice S.P. Garg and three members Praveen Garg, Anand Mohan Bajaj, and Pankaj Tyagi. The Appellate Authority has granted a period of two months to ICAI from the date of this order to conclude the proceedings pending before DC, subject of payment of costs of Rs.50,000/- (Rupees Fifty Thousand Only) within a week.

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