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2011 (9) TMI 845

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....les') as ultra vires as the said Rule transgresses and supplants section 21A(4) of the Chartered Accountants Act, 1949 (for brevity, 'the 1949 Act'). 2. We have heard Mr. Anurag Kumar Agarwal, learned counsel for the petitioner, Mr. Sachin Datta, learned Standing Counsel for Union of India and Mr. Rakesh Agarwal, learned counsel for the respondent-institute. 3. On a perusal of the pleadings that have been asseverated in the writ petition, we find the challenge pertains to the alleged transgression by the rule making authority of the statutory provision. Section 21 deals with 1949 Act, which occurs in Chapter V, which deals with misconduct. It deals with Disciplinary Directorate. The said provision reads as follows: "21. Disciplinary Dire....

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....Secretary of the Board. Sub-section (4) of section 21A reads as follows: "21A. (4) The Director (Discipline) shall submit before the Board of Discipline all information and complaints where he is of the opinion that there is no prima facie case; and the Board of Discipline may, if it agrees with the opinion of the Director (Discipline), close the matter or in case of disagreement, may advise the Director (Discipline) to further investigate the matter." 5. On a studied scrutiny of the aforesaid statutory provisions, it is clear that the Director (Discipline), who is the Secretary of the Board of Discipline, has been conferred the power to submit reports before the Board of Discipline with all the information on the complaints for the purpo....

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....se Rules if the matter pertains to Second Schedule or both the Schedules. It is urged by him when the section provides in a categorical manner either to close the case or direct further investigation, the question of reference to the Dispute Committee does not arise. 8. The Chapter IV of the 1949 Act deals with Board of Discipline. Chapter V deals with the Disciplinary Committee. Section 21A(4) clearly stipulates that if the Board of Discipline disagrees, it may advise the Director (Discipline) to further investigate the matter. It is, however, not possible to accept that the Board cannot disagree with the report of Director (Discipline) or in case of disagreement the Board can only direct further investigation by the Director (Discipline)....

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.... shall follow such procedure as may be specified. (3) Where the Disciplinary Committee is of the opinion that a member is guilty of a professional or other misconduct mentioned in the Second Schedule or both the First Schedule and the Second Schedule, it shall afford to the member an opportunity of being heard before making any order against him and may thereafter take any one or more of the following actions, namely:- (a)reprimand the member; (b)remove the name of the member from the Register permanently or for such period, as it thinks fit; (c)impose such fine as it may think fit, which may extend to rupees five lakhs. (4) The allowances payable to the members nominated by the Central Government shall be such as may be specified." 1....