Professional misconduct charge unsustainable where complaint was settled, withdrawn from press, and no evidence proved the allegation.

Professional misconduct in disciplinary proceedings of a penal character cannot be sustained on a bare complaint without supporting evidence. Where the complainant has settled the dispute, declined to press the complaint, and no witnesses or proof are led to establish the alleged failure to report non-compliance with accounting standards and company-law requirements, the charge fails for want of material evidence. The High Court therefore held that the finding of misconduct and the proposed disciplinary consequence were unsustainable, rejected the reference, and directed the proceedings to be filed.

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Issues: Whether the disciplinary finding of professional misconduct and the proposed punishment could be sustained when the complainant had settled the dispute, declined to press the complaint, and no evidence was led to prove the charge.

Analysis: The reference arose under Section 21(5) of the Chartered Accountants Act, 1949, in relation to a charge that the auditor had failed to report non-compliance with accounting standards and the requirement under Section 211(3C) of the Companies Act, 1956. The complaint before the Institute had already been compromised before the Company Law Board, and the complainant had communicated that he did not wish to press the complaint. Despite this, the disciplinary committee and the Council proceeded with the matter and returned findings of guilt. The record did not disclose any supporting evidence, examination of witnesses, or proof of the allegations apart from the abandoned complaint. In proceedings of this penal character, the charge had to be established with certainty and by material evidence; a bare and unsubstantiated accusation could not sustain a finding of misconduct.

Conclusion: The finding of misconduct was held unsustainable, the reference was rejected, and the proceedings were directed to be filed.

Final Conclusion: The Court declined to confirm the proposed disciplinary consequence because the charge was not proved and the complaint had ceased to survive after settlement.

Ratio Decidendi: In disciplinary proceedings of a penal nature, a charge of professional misconduct cannot be sustained in the absence of evidence proving the allegation, particularly where the underlying complaint has been settled and not pressed by the complainant.

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