{"id":985,"date":"2020-04-23T10:30:22","date_gmt":"2020-04-23T10:30:22","guid":{"rendered":"http:\/\/lexforti.com\/legal-news\/?p=985"},"modified":"2021-01-17T11:26:09","modified_gmt":"2021-01-17T11:26:09","slug":"icai-must-provide-reasons-to-a-complainant-when-it-closes-case-against-a-member","status":"publish","type":"post","link":"https:\/\/lexforti.com\/legal-news\/icai-must-provide-reasons-to-a-complainant-when-it-closes-case-against-a-member\/","title":{"rendered":"ICAI must provide reasons to a complainant when it closes case against a member"},"content":{"rendered":"\n<p><strong> Kosha Doshi | Symbiosis Law School, Pune | 16th March 2020 <\/strong><\/p>\n\n\n\n<p><strong>Trideep Raj vs ICAI., W.P.(C)-9032\/2018<\/strong><\/p>\n\n\n\n<p><strong>Facts:<\/strong><\/p>\n\n\n\n<p class=\"has-text-align-justify\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The petitioner had registered a\ncomplaint with the Institute of Chartered Accountants of India (ICAI) against\nan Internal Auditor of a company called \u201cFirst Leasing Company of India Limited\u201f in which the petitioner had invested. Soon after, the complaint\nwas closed and the final decision was communicated to the petitioner. The\nReserve Bank of India (RBI) called upon the company to recast the Balance sheet\nalong with the Profit and Loss Account. It was observed that the company had\noverstated assets as well as earnings. It was observed and alleged by the\npetitioner that the company had been falsifying its books and thereby\nportraying a positive net worth. The RBI issued a notice in the same regard for\nprohibition.<\/p>\n\n\n\n<p class=\"has-text-align-justify\">Without\nany summary or reasoning provided only the final verdict had been communicated\nto the petitioner by the Institute of Chartered Accountants of India (ICAI).\nThe grievance of the petitioner was that Institute of Chartered Accountants of\nIndia (ICAI) had failed to convey or even record the reasons for the closure of\nthe complaint. <\/p>\n\n\n\n<p class=\"has-text-align-justify\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Institute of Chartered Accountants\nof India (ICAI) argued that under the Chartered Accountants Act, proceedings\nbefore the Disciplinary Committee (Director) and the Board of Discipline was\nbetween the institute and its members only. Not being a private dispute, the\nreasons were not conveyed and only the decision mattered, argued Institute of\nChartered Accountants of India (ICAI). The complainant filed stating that\nrecord needed to be produced as it was his primary right under Right to\nInformation Act, 2005.<\/p>\n\n\n\n<p><strong>Issue:<\/strong><\/p>\n\n\n\n<p class=\"has-text-align-justify\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Whether Acts\/ Rules exempt the\nDirector or Board of Discipline from recording reasons in prima facie opinion\nof members not guilty of misconduct?<\/p>\n\n\n\n<p><strong>Judgment:<\/strong><\/p>\n\n\n\n<p class=\"has-text-align-justify\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The High Court of Delhi stated that\nInstitute of Chartered Accountants of India (ICAI) is under the obligation to\nprovide reasons to the complainant even in cases when the Director of Board of\nDiscipline has prima facie opinion of a member not being guilty of misconduct.\nThe reasons do not need to be elaborate but at least need to be provided. The\nreasons given need not be wide enough for scope of interpretation of courts\nthrough judicial review under Article 13 of the Indian Constitution of India. <\/p>\n\n\n\n<p class=\"has-text-align-justify\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Justice Navin Chalwa stated that\nwhere an enquiry is initiated by a complainant, he\/she is entitled to receive a\ncopy of the decision which contains the reasons for the particle closure. Duty\nto assign reasons and make it available to the complaint is one of the principles\nof natural justice and cannot be violated. Thereby it directed Institute of\nChartered Accountants of India (ICAI) to communicate the reasons for closure to\nthe complainant. The court further made a note that a complainant has a wider\nambit of rights than a mere informant. The informant having no right to be represented\nduring the investigation or hearing. <\/p>\n\n\n\n<p class=\"has-text-align-justify\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The court made a statement that\nActs\/ Rules cannot exempt the Director or Board of Discipline from recording\nreasons in prima facie opinion of members not guilty of misconduct as it would\nviolate the natural justice principle leading to grave injustice. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Kosha Doshi | Symbiosis Law School, Pune | 16th March 2020 Trideep Raj vs ICAI., W.P.(C)-9032\/2018 Facts: \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The petitioner had registered a complaint with the Institute of Chartered Accountants of India (ICAI) against an Internal Auditor of a company called \u201cFirst Leasing Company of India Limited\u201f in which the petitioner had invested. Soon after, [&hellip;]<\/p>\n","protected":false},"author":167,"featured_media":370,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[28],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.8.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>ICAI must provide reasons to a complainant when it closes case against a member - LexForti<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/lexforti.com\/legal-news\/icai-must-provide-reasons-to-a-complainant-when-it-closes-case-against-a-member\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"ICAI must provide reasons to a complainant when it closes case against a member - LexForti\" \/>\n<meta property=\"og:description\" content=\"Kosha Doshi | Symbiosis Law School, Pune | 16th March 2020 Trideep Raj vs ICAI., W.P.(C)-9032\/2018 Facts: \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 The petitioner had registered a complaint with the Institute of Chartered Accountants of India (ICAI) against an Internal Auditor of a company called \u201cFirst Leasing Company of India Limited\u201f in which the petitioner had invested. 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