The Andhra Pradesh High Court stayed the notification issued by the Institute of Chartered Accountants of India (ICAI) removing CA’s name from register of members who was allegedly involved in creating fake GST invoices and claiming Rs.5.08 crores as in the form of input tax credit without there being any actual supply of goods or services.
The bench of Justice Venkateswarlu Nimmagadda has observed that there shall be a stay on the publication in the Gazette of India regarding the removal of the CA’s name from the register of members. This stay is effective from today i.e., on 03.01.2025 till the date of filing an interlocutory application for interim stay along with the statutory appeal before the Appellate authority by the petitioner CA. Therefore, the petitioner, CA is at liberty to initiate a statutory appeal before the appellate authority within a period of 4 weeks.
The petitioner/assessee is an associate member of the ICAI and has been practicing his profession since 15.12.2016. While so, the Director General of GST Intelligence filed a complaint on 25.01.2021, alleging that the petitioner was involved in creating fake GST invoices and claiming Rs.5.08 crores as in the form of input tax credit without there being any actual supply of goods or services.
The Disciplinary Committee proceeded without following the due procedure as contemplated under the Chartered Accountants Act, 1949 and without providing an opportunity to the CA to cross-examine the witnesses.
As a mere formality, the Disciplinary Committee completed the disciplinary proceedings and passed the impugned order dated 24.10.2024, holding that the petitioner is guilty of the alleged offense and proposing an action as per the Chartered Accountants Act, 1949.
The ICAI contended that they had proposed an action in the form of punishment by removing the petitioner’s name from the register of members of the ICAI for a period of five years, effective from 03.01.2025. As per Section 22(G), the petitioner has an alternative remedy by way of appeal against any order passed by the 2nd respondent, if the delinquent is aggrieved by the same.
The ICAI contended that the order passed by the Disciplinary Committee is squarely amenable to appeal under Section 22(G). However, instead of availing this effective alternative statutory remedy, the petitioner has approached this court without alleging that the impugned order was passed with malafide intention or without following the procedure contemplated under the law. In view of the compliance of the statutory provisions as required, the order does not warrant interference by the court.
The court held that the petitioner is at liberty to initiate a statutory appeal before the appellate authority within a period of four weeks. The petitioner was also entitled to file an interlocutory application along with the statutory appeal, seeking interim suspension of the proceedings.
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Case Details
Case Title: CA Akshay Jain Versus ICAI
Case No.: Writ Petition No: 30264/2024
Date: 03/01/2025
Counsel For Appellant: Manoj Kumar Bethapudi
Counsel For Respondent: Varun Byreddy
