Facts of the Case

A complaint was filed by Shri Sudip Roy, Superintendent of Police and Head of Branch, Central Bureau of Investigation, Economic Offence Wing, Kolkata, against CA Gopal Pitti, Partner of M/s G. Pitti & Co., Chartered Accountants. The complaint arose from a CBI investigation into a bank loan fraud involving Shri Rakesh Kumar Singh, then Chief Manager of Allahabad Bank.

The investigation revealed that Shri Rakesh Kumar Singh had already acquired a second-hand Honda City car in February 2011 without payment, and subsequently applied for a car loan of ₹4 lakhs from Allahabad Bank in March 2012 by projecting the same car as a fresh purchase. For this purpose, documents such as a bill and delivery challan dated 20.08.2011 purportedly issued by M/s First Drive, a dealer in second-hand vehicles, were used. The allegation against the Respondent was that he connived with Shri Anil Agarwal of M/s First Drive in preparing fake documents and further assisted in routing and adjusting ₹4,70,000 to conceal the fraudulent transaction.

Issues Involved

Whether the Respondent Chartered Accountant connived in preparation and circulation of fake documents to facilitate a fraudulent bank loan transaction, whether his conduct amounted to “Other Misconduct” under Item (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949, and what disciplinary action was warranted under Section 21A.

Petitioner’s Arguments

The complainant relied upon the CBI charge sheet, statements of concerned persons, and documentary evidence to submit that the Respondent knowingly assisted in preparation of fake bills and delivery challans, helped in routing funds through connected entities, and played an active role in adjusting money to enable the accused bank official to avoid detection.

Respondent’s Arguments

The Respondent denied involvement and contended that allegations were based on contradictory third-party statements recorded many years after the events. He argued that no specific charge was framed against him in the CBI case, that documents were forwarded by him without intent to facilitate fraud, and that he was not directly involved in preparation of the disputed bills. He requested the Board to drop the charges.

Court / Authority Order and Findings

The Board of Discipline examined the charge sheet, recorded statements, emails and documentary evidence on record. The Board observed that the Respondent was aware of the parties involved, had prior familiarity with M/s First Drive and Shri Anil Agarwal, and had actively participated in forwarding and facilitating preparation of documents used to obtain the car loan. The Board further found that the Respondent played a key role in routing and adjusting ₹4,70,000 to enable refund of funds to the accused bank official.

On appreciation of evidence, the Board concluded that the Respondent acted in connivance with others in preparation of fake documents and adjustment of funds, thereby facilitating a fraudulent transaction. Such conduct was held to be unbecoming of a Chartered Accountant and squarely falling within “Other Misconduct” under Item (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949 read with Section 22.

Important Clarification

The Board clarified that even where a Chartered Accountant is not formally charge-sheeted in a criminal case, professional misconduct can still be established on the basis of material evidence showing connivance, facilitation of fraudulent transactions, and conduct unbecoming of the profession. Chartered Accountants are expected to maintain integrity and distance from any activity facilitating fraud.

Final Outcome

The ICAI Board of Discipline held CA Gopal Pitti (M. No. 053621) guilty of “Other Misconduct” under Item (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949. In exercise of powers under Section 21A(3), the Board passed an order dated 29 July 2025 reprimanding the Respondent.

Source Link- https://www.mytaxexpert.co.in/uploads/1768892664_ShriSudipRoyKolkatavsCA.GopalPittiM.No.053621Kolkata.pdf

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