Ajay Singh
Advocate

1. Professional misconduct by Chartered Accountant-Chartered Accountants Act Ss. 21(5) & 22

The Chartered Accountant (CA) was instrumental in getting a loan of Rs. 49.8 lakhs sanctioned from Union Bank of India, in favour of M/s. S.K. Trading Co. on the basis of forged documents such as quotations, supply orders, money deposit receipts of various firms, rent deed and rent receipts etc. The Chartered Accountant gave a false certificate stating that M/s. S.K. Trading Co. has brought the contribution required in the books on the basis of which the party got released a term loan of Rs. 12.8 lakhs from Union of India.

The Council of the Institute of Chartered Accountants of India held that a prima facie case was made out against the Chartered Accountant which was required to be looked into by the Disciplinary Committee of the Council. The Disciplinary Committee of the Council came to the conclusion that he was guilty of "other misconduct" within the meaning of section 22 read with section 21(5) of the Chartered Accountants Act, 1949. On the basis of this conclusion, the Council recommended to Hon’ble Court that his name be removed from the register of members for a period of one month.

The Hon’ble Delhi High Court observed that the activity of Chartered Accountant in issuing a vague certificate with the intention of persuading the bank to grant his client a loan, amount to "other misconduct" within the meaning of the Act read with the Regulations framed thereunder.

The lack of responsibility displayed by Chartered Accountant showed that he had acted in a manner unbecoming of a Chartered Accountant and, therefore, the Council rightly recommended removal of his name from the register of members for a period of one month.

The Hon’ble Court further observed that there has to be some degree of integrity and probity which is expected of a Chartered Accountant who is regularly concerned with financial transactions and on the basis of whose recommendations and certificates financial institutions such as banks disburse loans or enter into other financial transactions.

The Hon’ble Court accept the recommendations of the Council to the effect that the name of the Chartered Accountant be removed from the register of members for a period of one month.

Council of the Institute of C.A. of India vs. Dayal Singh F.C.A. & Anr. AIR (2007) Del. 263

2. Deficiency in service by bus transporter: Consumer Protection Act

Injury sustained by passenger of bus due to sudden applying of brakes by driver and not due to accident. It was held that the injury sustained by passenger was due to negligence of driver which amounts to deficiency in service.

Managing Director, TNSETC Ltd. vs.R. Kadarkarai AIR 2007 (NOC) 2133 (NCC)

3. Deficiency in service by banks: Consumer Protection Act

Due to presence of white ants/termites in bank locker currency notes, certificates and jewellery of hirer was damaged. Bank was bound to ensure that hirers locker remained safe in all respects. Bank was directed to pay compensation.

Union Bank of India vs. Smt. Kanak Choudhary & Anr. AIR 2007 (NOC) 2134 (NCC)

4. Education : Reassessment of answer script

The challenge in this appeal is to the order passed by the Division Bench of the Calcutta High Court directing re-examination of answer script of Respondent 1 in English Paper 1.

The learned Single Judge directed that paper, in question, be reassessed by another examiner. It was pointed out that there is no provision in any statute permitting such inspection, but in view of the direction given by the learned Single Judge, inspection was granted. The Division Bench upheld the impugned order holding that Judges themselves have looked the answer script and were satisfied that there was scope of reassessment.

The Hon’ble Supreme Court quashing the order of Division Bench held that finality has to be the result of public examination and, in the absence of statutory provision, the court cannot direct reassessment/re-examination of answer scripts. The courts normally should not direct the production of answer scripts to be inspected by the writ petitioners unless a case is made out to show that either some question has not been evaluated or that the evaluation has been done contrary to the norms fixed by the examining body. For example, in certain cases examining body can provide model answers to the questions. In such cases the examinees satisfy the court that model answer is different from what has been adopted by the Board. Then only can the court ask for the production of answer scripts to allow inspection of the answer scripts by the examinee, same should be a rarity and it can only be done in exceptional cases.

Secy., W.b. Council of Higher Secondary Education vs. Ayan Das and Others (2007) 8 Scc 242

5. Tribunal must be manned by person of proven integrity and any doubt about person's integrity should be considered for disqualification

The Petitioner had sought a direction that he be appointed as a Member (Technical) in Customs, Excise and Service Tax Appellate Tribunal, (CESTAT), on the basis of recommendation made by the Selection Committee to the Appointment Committee (A.C.C.) The petitioner had also sought a direction that after the approval of the A.C.C. the action of the respondents in submitting a proposal for deletion of his name be declared as illegal and bad in law.

The Selection Committee consisted of a sitting judge of the Supreme Court, Secretary Ministry of Law, Secretary (Revenue) in the Ministry of Finance was constituted. The petitioner was one of the applicants. The Selection Committee recommended three names for the post of member (Technical). After processing the recommendations of the Selection Committee, the Cabinet Secretary, forwarded a note for A.C.C. The Cabinet Committee according to Petitioner had withheld his appointment and the Petitioner being aggrieved by that action has approached the Tribunal. It was the case of the Petitioner before the Tribunal that after the Selection Committee had recommended his name and he has been granted vigilance clearance by the department of Revenue, he ought to have been appointed. According to the Petitioner, he came to know that his name had been annulled as his name found a place in the ‘Agreed list’. This information was not placed before the Selection Committee.

The agreed list is a list of officers of perceived doubtful integrity in certain departments prepared jointly by the CBI and department. The instructions provide a quiet check about the reputation of such officers without contemplating any punitive action as such. Though no adverse or punitive action is contemplated, the officers on agreed list are not to be posted on a sensitive post. The Tribunal rejected that contention by holding that selection of Member, CESTAT is done by a Committee headed by a sitting Judge of the Supreme Court by itself is sufficient enough to indicate that the Government regards such post as sensitive post and such classification cannot be regarded as irrational. It is this order which is the subject matter of the
petition before the Hon’ble Bombay High Court.

The Hon’ble Court observed that once the Selection Committee was headed by the high functionary and in this case, a Hon’ble Judge of the Supreme Court, normally there ought to be no interference with the selection done. However, as noted by the Supreme Court itself, in Dr. A.K. Doshi vs. UOI 2001 SCC (L & S) 10, in exceptional cases, material may be placed before the appointments committee which was not placed before the Selection Committee. The Petitioner’s name was found in the agreed list, which provides the scheme for preparation, maintenance and custody of the lists of public servants of gazetted status of doubtful integrity. In opinion of the Court, the Agreed list is distinct from the list of public servant of gazetted status of doubtful integrity.

The Hon’ble Court observed that the agreed list is prepared by a procedure which involves discussion with the head of the department concerned, the Additional I.G.P. and the D.I.G. (Special) of the C.B.I. The agreed list is prepared based on the inputs from the additional IGP and DIG (Special) of CBI who gather vital and secret information. All of them together assess and take a decision whether the name of the person should be kept on the agreed list. The post to which the petitioner seeks appointment is a sensitive post. The Court agreed with the views of the Tribunal that it is only persons with unblemished record and high integrity who alone should be allowed to occupy such posts. Any adverse reference against the officer, specifically about integrity, even if it be a doubt must necessarily result in such officer being denied appointment to a quasi-judicial post. The Tribunals are part of judicial process and administration of justice over which High Court exercise the supervisory jurisdiction. The Court held that such Tribunals must be manned by persons of proven integrity and any doubt about a persons integrity, should be considered as a disqualification. The rule of law envisages a fair and impartial Tribunal not specially about integrity. The integrity of the candidate can always be independently looked into by other material including reports of investigating agencies apart from the profile of the candidate which is available in the Central Railway who alone should be allowed to occupy such posts. Any adverse inference against the officer, specifically about integr

In view of the above the petition was dismissed.

Ramesh Motiram Ramchandi vs. UOI 2007 (216) ELT 192 (Bom)