SEBI Limited in Action Against Auditors Lacking Evidence of Fraud or Collusion; No Authority Over ICAI, NFRA Investigations.

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....Power of SEBI to initiation action against Chartered Accountant (CA) / Auditor of the company - Once there is a finding that the appellants have not manipulated the books of accounts with knowledge and fraudulent intention or in connivance with the officers or management of the Company then no directions could be issued by the WTM to the ICAI or NFRA to consider dereliction of duties and abhorrence of due diligence while conducting statutory audit as in our opinion it was outside the domain of the WTM to issue such directions. At best, administrative directions could have been issued by SEBI to the aforesaid institutions to consider the alleged irregularities but beyond that no adjudicatory directions could be issued by the WTM. - AT....