Facts of the Case

A complaint was filed by Ms. K. S. Aruna Vasumathi alleging professional misconduct against CA R. Seshadri. The complainant had earlier worked with M/s Infosys Technologies Pvt. Ltd. and later faced difficulties in accessing her Income Tax e-filing account. Upon eventually regaining access, she discovered that her primary and secondary contact details, including mobile number and email ID, had been changed without her consent.

The complainant alleged that unauthorized access to her Income Tax account was gained through the Respondent’s office infrastructure and that such access enabled retrieval of her PAN and password, which were later used in matrimonial litigation pending before the Sub-Court, Tambaram. A complaint was lodged with the Cyber Crime Cell, Chennai City, and an FIR was registered in 2018. Allegations were raised that the Respondent, practicing as a Chartered Accountant, connived in or facilitated illegal access to the complainant’s Income Tax account.

Issues Involved

Whether the Respondent was involved in or responsible for unauthorized access to the complainant’s Income Tax e-filing account, whether such access was gained using the Respondent’s office infrastructure with his knowledge or consent, and whether such conduct constituted “Other Misconduct” under Item (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949.

Complainant’s Arguments

The complainant alleged that illegal access to her Income Tax account could not have occurred without involvement of the Respondent, as the breach allegedly originated from his office systems. It was contended that as the owner of the office, the Respondent was responsible for acts committed using his office infrastructure. The complainant further argued that affidavits produced by third parties admitting misuse were obtained under coercion and could not absolve the Respondent of responsibility.

Respondent’s Arguments

The Respondent denied all allegations and submitted that he had no knowledge of, or involvement in, unauthorized access to the complainant’s Income Tax account. He explained that one Mr. D. Ranganathan, accountant of M/s Covai Seenu & Company and acquaintance of the complainant’s husband, misused the “forgot password” facility on the Income Tax portal using the complainant’s PAN card details without the Respondent’s knowledge.

The Respondent produced notarised affidavits of Mr. D. Ranganathan, Mr. J. Ravi Kumar and Mr. M. Venkateswaran, who took full responsibility for the unauthorized act and categorically stated that the Respondent and his staff had no role in the incident. The Respondent further produced police investigation records, Cyber Crime Cell reports, and the order of the Hon’ble Madras High Court discharging him from criminal proceedings.

Court / Authority Order and Findings

The Board of Discipline examined the entire record including affidavits of the concerned individuals, police investigation reports, Cyber Crime Cell findings, High Court orders and submissions of the parties. The Board observed that the affidavits clearly established that unauthorized access to the complainant’s Income Tax account was carried out by Mr. D. Ranganathan using PAN details supplied by the complainant’s husband, without the knowledge or consent of the Respondent.

The Board noted that the Respondent maintained multiple official email IDs for client communication and that misuse of one such system by a third party, without authorization, could not automatically be attributed to the Respondent. The Board further observed that there was no evidence to show that the Respondent personally accessed the complainant’s account, altered login credentials, or directed any person to do so.

The Board also took note of the Hon’ble Madras High Court’s order discharging the Respondent from criminal proceedings, wherein it was held that downloading Income Tax details for use in court proceedings, though questionable, did not amount to fraud or dishonest intention attributable to the Respondent.

On appreciation of evidence, the Board concluded that there was no direct or circumstantial evidence to establish involvement, consent or connivance of the Respondent in the alleged unauthorized access.

Important Clarification

The Board clarified that disciplinary liability of a Chartered Accountant cannot be fastened merely because misuse of digital infrastructure occurred in his office premises. Where independent affidavits, police investigations and judicial orders establish that unauthorized acts were committed by third parties without the member’s knowledge, professional misconduct cannot be inferred.

Final Outcome

The ICAI Board of Discipline held CA R. Seshadri (M. No. 205989) Not Guilty of “Other Misconduct” under Item (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949 read with Section 22. By order dated 10 February 2023, the Board directed closure of the case under Rule 15(2) of the Chartered Accountants (Procedure of Investigations of Professional and Other Misconduct and Conduct of Cases) Rules, 2007.

Source Link - https://www.mytaxexpert.co.in/uploads/1768898804_Ms.K.S.ArunaVasumathiChennaivsCA.R.SeshadriM.No.205989Coimbatore.pdf

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