2023 (8) TMI 983

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....o certain information received against the firm - C. C. Chokshi & Co., in which Respondents were the concerned partners, the Institute of Chartered Accountants of India (Institute), referred the information to the Disciplinary Committee constituted under Section 17 of the Act. The information was the observations of the Committee constituted to enquire into the Securities Transactions of the Banks and Financial Institutions (the Janakiraman Committee), the Joint Committee to enquire into irregularities in Securities and Banking Transactions (the JPC), SEBI Inspection Report on Canbank Mutual Fund (CBMF) and Annual Reports of various schemes of CBMF for the year 1991-92. The matter was treated as "information" and letter of "information" was....

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.... (ii) 8th charge - loss in the secondary market on transactions for no plausible reasons CBMF sustained loss because of defaults in delivery of scrips/ delays in receipt of payments for sale contracts, selling at off market rates at a loss and diversion of funds. Also CBMF entered into deals without prior approval of the sanctioning authority. The allegation is as statutory auditors Respondents did not indicate weaknesses in the internal control system of CBMF as required in paragraph 26 of SAP-6 and also fraud / manipulation in transactions with the brokers as required in paragraphs 17-20 of SAP-4 issued by ICAI. (iii) 16th charge - indirect lending / underwriting by CBMF. Mutual funds should not undertake direct or indirect lending por....