Facts of the Case

A complaint was filed by Mr. Kanhaiya Singhal alleging professional misconduct against CA Shailendra Singh. The complainant alleged that the Respondent wrongfully accessed his personal information from the Income Tax website without authorisation, certified such information, and furnished it to one of his clients, Mr. Sumit Gupta, thereby causing wrongful loss to the complainant and wrongful gain to himself.

The Respondent issued an Income Certificate dated April 2018 certifying income details of the complainant based on Form 26AS and Income Tax records. The complainant alleged that such certificate was issued without his consent and that the Respondent had hacked the Income Tax portal to obtain his confidential information. The dispute arose in the backdrop of matrimonial litigation between the complainant and his wife, Ms. Archana, who had used the income certificate in proceedings relating to maintenance and alimony.

Issues Involved

Whether the Respondent accessed the complainant’s Income Tax records without authorisation, misused personal data, and issued an income certificate with malafide intent, and whether such acts constituted “Other Misconduct” under Item (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949.

Petitioner’s Arguments

The complainant alleged that the Respondent was never appointed by him and had no authority to log into his Income Tax account or issue any certificate. It was contended that discrepancies in the dates mentioned on the income certificate, alleged fabrication of bills, and use of the certificate in matrimonial litigation demonstrated malafide intent and hacking of Income Tax credentials. The complainant relied upon FIRs, family court proceedings and assertions of data misuse.

Respondent’s Arguments

The Respondent submitted that he issued the income certificate at the request of the complainant’s legally wedded wife, Ms. Archana, who provided Form 26AS, login ID and password of the complainant for verification. He contended that issuance of the certificate was based on information and documents available on the Income Tax website and provided by the wife, and that the certificate was issued on payment of professional fees of ₹1,000.

The Respondent further submitted that it was a family dispute and that there was no hacking of the Income Tax portal. He relied upon judicial precedents recognising the right of a spouse to access income details for claiming maintenance. He denied any malafide intent or wrongful gain and contended that the certificate was issued with due diligence.

Court / Authority Order and Findings

The Board of Discipline examined the pleadings, documents, submissions of the parties and the income certificate issued by the Respondent. The Board noted that the certificate expressly stated that it was issued on the basis of information and documents available on the Income Tax website and explanations given. The Board observed that the complainant’s wife had access to the complainant’s PAN details, Form 26AS and login credentials, which was corroborated by material on record.

The Board further observed that the difference in dates appearing on the certificate was attributable to a typographical error and that the handwritten date represented the actual date of issuance. The Board also noted that the Upper Family Court had recorded observations that the complainant’s wife had access to Income Tax records and had obtained relevant documents, and that there was no finding establishing hacking by the Respondent.

On appreciation of evidence, the Board concluded that due diligence had been exercised by the Respondent, that access to Income Tax records was through credentials provided by the complainant’s wife, and that there was no malafide intent or unlawful gain. The allegations were found to stem from a matrimonial dispute rather than professional misconduct.

Important Clarification

The Board clarified that allegation of unauthorised access to Income Tax data must be supported by cogent evidence establishing hacking or misuse by the Chartered Accountant. Where access is obtained through credentials voluntarily provided by a spouse and the certificate is issued with due diligence, professional misconduct cannot be inferred merely on the basis of subsequent family disputes.

Final Outcome

The ICAI Board of Discipline held CA Shailendra Singh (M. No. 416765) 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 October 2022, 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/1768898689_Mr.KanhaiyaSinghalDelhivsCA.ShailendraSinghM.No.416765OraiJalaunU.P..pdf

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