Delhi High Court asks ICAI to frame policy mandating Chartered Accountants to disclose criminal cases against them

The Delhi High Court on Friday called for the framing of a policy and mechanism for chartered accountants to disclose criminal cases or convictions against them on a periodic basis [Mohit Bansal v Institute of Chartered Accountants of India and Anr]..Justice Pratibha M Singh said that such a policy is necessary, and asked the Institute of Chartered Accountants of India (ICAI) to not stay in the dark about criminal proceedings against the members who are on its register.“ICAI shall accordingly frame a policy and a mechanism, if not already in existence, for disclosure by members both at the inception as also on a periodic basis thereafter, of any criminal cases or convictions so that the spirit and intent of the statute is given effect to and the ICAI is not in the dark about the same until it is notified by some information or complaint,” the single-judge ruled..The Court was dealing with a petition filed by a chartered accountant (CA), Mohit Bansal, challenging the show-cause notice issued to him under Section 8(v) of the Chartered Accountants Act, regarding his conviction for assaulting a woman in 2001.Section 8(v) deals with offences involving ‘moral turpitude’ and stipulates that if a person is convicted of such an act, their name can be barred from being entered or borne in the register of the ICAI.It was argued that though he was first convicted of gang-rape but, in February 2010, the High Court had reduced it to assault. However, this fact was kept hidden from the ICAI for all these years and a show-cause notice was only issued in June 2018, allowing him to keep his practise for over a decade..Justice Singh held that there are certain professions and services which require a very high standard of integrity and are considered ‘noble', and being a CA falls in that category. The Court, therefore, upheld the show-cause notice, observing that the petitioner's case is covered under Section 8(v) of the CA Act.“The Petitioner, in this case, having been convicted for offences under Section 354 and 506-II of IPC, is clearly attracted by the disability under Section 8(v) of the Act. He has already practiced for almost 12 years by the time the notice was issued by ICAI. Ideally, ICAI ought to have had adequate checks at the time of registration itself. However, the fact that the conviction of the Petitioner may have not come to the attention of the ICAI for more than 10 years would not, in any manner, bar ICAI from taking action, especially, when the offence involved is one of such a grave and serious nature,” the Court said. .Justice Singh added that although a bare reading of sub-section 8(v) suggests that the Central government would have the power to remove the disability even in offence of ‘moral turpitude’, but in the opinion of the Court such powers would be contrary to the statute as well as settled judicial precedents. The only way a person can continue on the register of the ICAI would be if they have been granted a pardon.“The use of the expression “entered in” contained in Section 8, also shows that offences committed prior to the person qualifying as a CA are also within the purview of the disabilities mentioned under Section 8 of the Act. The only condition upon which a person convicted can be entered into or can continue on the register of ICAI, would be if the person has been granted a pardon,” the judgment stated. .While the petitioner appeared in-person in the case, Senior Advocate Ramji Srinivasan, along with advocates Pooja Saigal, Simrat S Pasay, Chaitanya Pandey, Farman Ali and Athar Raza Farooquei appeared for the respondents..[Read Judgment]