C A RAJESH Vs. DISCIPLINARY COMMITTEE

JUDGEMENT

(1.) In present petition, the petitioner has prayed that:-

(2.) The relevant facts, involved in and leading to submission of present petition are that, the petitioner, a practicing Chartered Accountant [hereinafter referred to as "CA"] had undertaken, on agreement, assignment as Chartered Accountant of a multi location unit i.e. M/s. Sumilon Industries Ltd, Surat. The assignment also included work of auditing the accounts of the said company. It appears from the record that on the basis of the certificate issued by the petitioner in his capacity as CA, the Excise Department had made certain assessments and liability of the said company towards excise duty under Excise Act were assessed. Thereafter, it came to the notice of the Excise Department that the accounts and audit report submitted by the petitioner was inaccurate and there were several serious and material discrepancies and anomalies. In this view of the matter, the office of Commissioner of Central Excise, Surat lodged complaint with the institute of the Chartered Account [hereinafter referred to as "the institute"] and vide letter dated 24.10.2008 brought to the notice of the institute the irregularities as well as the inaccuracies, anomalies and mistakes committed by the petitioner in the accounts and audit report.

(3.) Mr. Shah, learned advocate, has appeared for the petitioner and submitted that the impugned order dated 12.9.2011 and the order dated 5.5.2012 are arbitrary, too harsh and non-commensurate with the alleged misconduct. The learned counsel for the petitioner contended that the petitioner cannot be said to have shown gross negligence (as contemplated under clause (7) of Part-I of IInd Schedule to the Act) in preparing and submitting tax audit report. Mr. Shah, learned counsel for the petitioner submitted that the tax audit report contained some minor and irrelevant typographical errors which are negligible and the said mistakes / errors did not cause or did not result into any actual financial loss to the Excise Department. He submitted that the errors in the tax audit report cannot be construed as or classified as gross negligence as contemplated under clause (7) of Part-I of IInd Schedule to the Act. Mr. Shah, learned advocate for the petitioner, also claimed that the report/order dated 12.9.2011 by the competent authority of the institute also suffers from vice of violation of principles of natural justice, inasmuch as despite the fact that the petitioner had requested for adjournment vide his letter dated 26.7.2011, the request was not granted and the committee/competent authority proceeded to pass final order as regards penalty without hearing the petitioner on the issue as regards quantum of penalty. Mr. Shah, learned advocate for the petitioner, referred to the tax audit report prepared and submitted by him in relation to the above-named company and tried to contend that actually there are no mistakes in the report and the petitioner has separately shown the inter-departmental transfer / consumption of material and the sale of material in the market by the company and the conclusions by the institute are not correct. Mr. Shah, learned advocate for the petitioner, submitted that the matter deserves to be remanded for reconsideration by the appellate committee so far as the quantum of penalty is concerned.