Facts of the Case

Disciplinary proceedings were initiated In Re: CA Abhay Batra based on information provided by the Informant. The matter related to the period during which the Respondent held a full-time Certificate of Practice from 1 September 2011 to 1 October 2016 while simultaneously being in full-time employment with various organisations.

The record showed that the Respondent was employed as a Consultant with M/s Protiviti Consulting Private Limited with effect from 2 January 2012, later joined M/s MMTC-PAMP India Private Limited as Chief Accounting and Corporate Controller, and subsequently joined M/s Purple Panda Fashions Private Limited as Chief Financial Officer with effect from 25 January 2016.

Despite being in full-time employment during the aforesaid period, the Respondent continued to hold a Certificate of Practice issued by the Institute of Chartered Accountants of India.

Issues Involved

Whether the Respondent violated Regulation 190A of the Chartered Accountants Regulations, 1988 by holding a Certificate of Practice while being in full-time employment, and whether such conduct constituted professional misconduct under Item (11) of Part I of the First Schedule to the Chartered Accountants Act, 1949.

Petitioner’s / Informant’s Case

The Informant alleged that the Respondent knowingly held a Certificate of Practice while being in full-time employment, which is expressly prohibited under Regulation 190A unless prior approval of the Council is obtained. Documentary evidence including employer letters and RTI responses from ICAI were relied upon to establish that the Respondent held a full-time Certificate of Practice from 01.09.2011 to 01.10.2016 while being employed.

Respondent’s Arguments

The Respondent submitted that he had never practiced as a Chartered Accountant, had not accepted any audit, certification or assurance assignments, and had not derived any pecuniary or other benefit from holding the Certificate of Practice. He contended that the holding of the Certificate of Practice was inadvertent and a bona fide mistake, and that he surrendered the Certificate of Practice in January 2016.

The Respondent further submitted that he regretted the lapse unconditionally and that there was no malafide intention or misuse of professional status.

Court Order / Findings

The ICAI Board of Discipline examined the membership records, Forms filed with ICAI, employment details, written submissions and oral representations of the Respondent. The Board observed that the Respondent himself admitted to holding a Certificate of Practice from 1 September 2011 to 1 October 2016 while being in full-time employment.

The Board noted that although there was no evidence of monetary benefit or professional practice, Regulation 190A clearly prohibits a Chartered Accountant in practice from engaging in full-time employment without prior permission of the Council. The Board observed that the Respondent, with due diligence, could have informed the Institute and converted his Certificate of Practice to part-time status, but failed to do so.

Accordingly, the Board held that mere absence of financial gain does not absolve a member from compliance with statutory regulations, and the Respondent’s conduct squarely amounted to professional misconduct.

Important Clarification

The Board clarified that holding a Certificate of Practice while being in full-time employment is a violation per se, irrespective of whether the member actually undertakes professional work or derives monetary benefit. Compliance with Regulation 190A is mandatory, and ignorance or inadvertence cannot be a complete defence.

Final Outcome

The ICAI Board of Discipline held CA Abhay Batra (M. No. 520590) Guilty of Professional Misconduct under Item (11) of Part I of the First Schedule to the Chartered Accountants Act, 1949.

By order dated 19 April 2023, passed under Section 21A(3) of the Act, the Board Reprimanded the Respondent.

Source Link- https://www.mytaxexpert.co.in/uploads/1768899016_CA.AbhayBatraM.No.520590NewDelhiinRe..pdf

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