CA cannot be Held liable for Professional Misconduct merely Differing from other Professional’s Opinion: ICAI [Read Order]

The Disciplinary Committee of the Institute of Chartered Accountantsof India (ICAI) has held that a Chartered Accountant cannot be held liable for professional misconduct merely because his opinion differs from the other expert.

A complaint was filed before ICAI against CA Praveen Kumar Srivastava by a flat buyer. The complainant challenged additional monetary demands raised by the builder towards VAT, labour cess, farmer compensation and IGL charges after possession.

The UP RERA, based on the conflicting opinions by the buyer consultant and builder consultant, sought an opinion from its empanelled CA, the respondent limited to the admissibility of certain demands under the BuilderBuyer Agreement (BBA).

After getting the opinion from respondent-CA, UP REAR directed the buyers to pay the demand. Aggrieved by this, the complainant filed a disciplinary complaint alleging bias, negligence and misconduct against the respondent.

On these allegations, the respondent- CA claimed that his engagement was to give a general legal opinion to UP RERA based on the BBA, not a buyer-specific audit or investigation. He also disclosed the purpose, scope, sources of information and limitations, including documents provided by the authority and certifications placed on record before the committee.

The respondent submitted that differing professional approaches do not amount to misconduct; and the final adjudicatory discretion is with UP RERA, not with the respondent.

The ICAI disciplinary committee observed that CA’s opinion clearly set out its purpose, scope and limitations, depending on the BBA and materials provided. It also included disclaimers.

The committee also noted the UP RERA did not comment on the opinion of the accountant and the opinion was completely based on the materials given and the engagement did not entail audit or investigative responsibilities.

It was observed that “the Respondent had clearly given the basis of his Opinion in his Report itself and also brought on record the copy of the documents relied upon by him while giving his Opinion. The Committee held that a professional cannot be held liable for professional misconduct merely on account of giving an Opinion which is different from that of another professional”

Therefore the committee found that the CA not guilty of professional misconduct under Item (7) of Part I of the Second Schedule to the CharteredAccountants Act, 1949.

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