CA discharging duty towards client; Orissa High Court quashes criminal proceedings against CA

CA discharging duty towards client; Orissa High Court quashes criminal proceedings against CA

Criminal proceedings were launched against him in a bank fraud case

The Orissa High Court has held that the certification of Charge Sanction Form No. 17 with the Registrar of Companies (RoC) cannot attribute criminal liability to the chartered accountant (CA).

While quashing the criminal proceedings against him, the court maintained the CA was only discharging his professional duties toward his client.

Criminal prosecution was launched against a few persons accused of conniving and conspiring in siphoning off public money with the intention to defraud the bank.

The petitioner, Kulamani Parida is the CA of Chhotray Suppliers and Srabani Constructions Pvt. Ltd.

While discharging his professional duties, he carried out the instructions given to him by the firm. His client supplied him the impugned document, 'No Objection Certificate' for annexing it with Form No.17 and the declaration was that of the client.

The bench comprising Justice Chittaranjan Dash observed, "While discharging the professional duty as a CA in submitting the compliance before the authority, the CA depends upon his client in procuring records, including the bank statement and other documents. Consequently, nothing can be attributed that he had any role either in preparing or procuring the document for being placed before the authority and to ascertain its genuinity. The consequence of the supply or procurement of documents would obviously go to the client and not to the professional.

Justice Dash reiterated that the CA was only discharging his duty and it cannot be said that he conspired along with his client.

He added, "It is indeed true that the court while exercising the jurisdiction under CrPC needs to circumspect the overall facts emerging from the allegations and to arrive at a conclusion if there appears material constituting offence against the petitioner."

The court stated, "The allegation in the FIR and the bank's complaint vis-à-vis the petitioner does not make out a case constituting the offences under IPC, as neither the petitioner is part of the business transaction allegedly to have conducted by the co-accused persons, nor that the document forged and fabricated is attributed to him in absence of the material showing his personal interest in any gain/loss of the parties conducting business except that he retains his professional interest."

The court further said, "Consequently, this court finds no material to proceed against the petitioner."