The Disciplinary Committee of the Institute of Chartered Accountants of India (ICAI) has found CA. Shubham Agarwal guilty of professional and other misconduct. The charges stemmed from a complaint filed by Ms. Himani Chouhan, Legal Advisor for M/s. SKS Business Services Limited. The Committee determined that CA. Shubham Agarwal violated his employment contract by soliciting clients of his former employer, engaged in data theft, and sought professional work unethically. Additionally, he was found to be offering and rendering audit services through an unregistered firm, which is a breach of ICAI regulations. Despite multiple hearing notices, the respondent did not appear, leading to an ex-parte conclusion of the case. Considering the severity of the misconduct and the respondent’s lack of engagement, the Disciplinary Committee ordered that CA. Shubham Agarwal be reprimanded and fined Rs. 1,00,000/- (Rupees One Lakh only), payable within 60 days from the order’s receipt.
THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
(Set up by an Act of Parliament)
PR/176/2021-DD/249/2021-DC/1685/2022
[DISCIPLINARY COMMITTEE [BENCH-II (2024-2025)]
[Constituted under Section 21B of the Chartered Accountants Act, 1949]
ORDER UNDER SECTION 21B (3) OF THE CHARTERED ACCOUNTANTS ACT. 1949 READ WITH RULE 19(1) OF THE CHARTERED ACCOUNTANTS (PROCEDURE OF INVESTIGATIONS OF PROFESSIONAL AND OTHER MISCONDUCT AND CONDUCT OF CASES) RULES, 2007
In the matter of:
Ms Himani Chouhan, Legal Advisor, M/s SKS Business Services Limited … Complainant
Versus
CA Shubham Agarwal … Respondent.
Members Present:-
CA. Ranjeet Kumar Agarwal, Presiding Officer (in person)
Mrs. Rani S. Nair, IRS (Retd.), Government Nominee (through VC)
Shri Arun Kumar, IAS (Retd.), Government Nominee (in person)
CA. Sanjay Kumar Agarwal, Member(in person)
CA. Cotha S Srinivas, Member (through VC)
Date of Hearing :10th April, 2024
Date of Order : 28th May, 2024
1.That vide Findings under Rule 18(17) of the Chartered Accountants (Procedure of. Investigations of Professional and Other Misconduct and Conduct of Cases) Rules, 2007, the. Disciplinary Committee. was, inter-alia, of the opinion that Shubham Agarwal (hereinafter referred to as the ‘Respondent) is GUILTY of Professional Misconduct and Other Misconduct falling within the meaning of Item (6) of Part I of the First Schedule, Item (2) of Part IV of the First Schedule and Item (1) and (2) of Part II of the Second Schedule to the Chartered Accountants Act, 1949.
2. That pursuant to the said Findings, an action under Section 21B (3) of the Chartered Accountants (Amendment) Act, 2006 was contemplated against the Respondent and a communication was addressed to him thereby granting opportunity of being heard in person / through video conferencing and to make representation before the Committee on 10th April 2024.
3. The Committee noted that on the date of the hearing held on 10th April 2024, neither the Respondent was present before it nor was there any intimation as regard his non-appearance despite the due delivery of the notice for hearing and copy of the Findings of the Disciplinary Committee upon him.
3.1 The Committee also noted that the soft copy of the Findings of the Disciplinary Committee and the Notice for the hearing had also been sent to the email address available in the member records of !CAI. As per email delivery intimation for the said communication(s), the delivery of the said email(s) had been completed. The Committee further noted from the member records of ICAI that ‘KYM’ Form of the Respondent had been submitted and the same was found ‘ok’.
3.2 Furthermore, the Committee noted that the Respondent did not submit his further written submissions on the Prima Facie Opinion during the course of hearing in the case. The Committee also noted that the aforesaid case was listed for hearing before it on four occasions and the Respondent did not appear even once during the hearing despite the due delivery of the communication for hearing. Accordingly, the case was concluded ex-parte on 13th December 2023.
3.3 Thus, the Committee was of the view that all possible efforts (speed post and email) have been made to ensure the delivery of the communication for hearing upon the Respondent, but he chose not to represent before the Committee. Keeping in view the provisions of Rule 19(1) of the Chartered Accountants (Procedure of Investigations of Professional and Other Misconduct and Conduct of Cases) Rules, 2007, the Committee was of the view that the Respondent has nothing more to represent before it and thus, decided to consider his case for award of punishment on the basis of material available on record.
4. The Committee considered the reasoning as contained in’ the Findings holding the Respondent Guilty of Professional and Other Misconduct
5. Keeping in view the facts as well as circumstances of the case and material on record, the Committee with respect to the first charge held that the Respondent was not supposed to directly or indirectly solicit or attempt to solicit or establish the contact with the Company’s customer and clients for providing any services connected to the Complainant Company. Thus, the Respondent was charged for breach of employment contract with M/s. SKS Business Services Private Limited and data theft. Further, the Respondent by such an act had not only violated the terms of employment but also lowered the image of the profession.
5.1 As regard the second charge, the Committee held that the act of the Respondent of seeking professional work without any enquiry by the Complainant Company’s client is in violation of the ethical requirements as laid down in Code of Ethics issued by the ICAI.
5.2 As regard the third charge, the Committee held that the Respondent was offering and rendering services including audit service through a firm which was not registered with the ICAI, and the said act of the Respondent is in violation of the requirement of Regulation 190 of the Chartered Accountants Regulations, 1988.
5.3 Hence, professional and other misconduct on the part of the Respondent is clearly established as spelt out in the Committee’s Findings dated 7th February 2024 which is to be read in consonance with the instant Order being passed in the case.
6. Accordingly, the Committee was of the view that ends of justice will be met if punishment is given to him in commensurate with his professional and other misconduct.
7. Thus, the Committee ordered that CA. Shubham Agarwal be Reprimanded and also a Fine of Rs. 1,00,000/- (Rupees One Lakh only) be imposed upon him payable within a period of 60 days from the date of receipt of the Order.
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(CA. RANJEET KUMAR AGARWAL)
PRESIDING OFFICER
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(MRS. RANI S. NAIR, IRS (RETD.))
GOVERNMENT NOMINEE
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(SHRI ARUN KUIVIAR, IAS (RETD.))
GOVERNMENT NOMINEE
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(CA. SANJAY KUMAR AGARWAL)
MEMBER
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(CA. COTHA S SRINIVAS)
MEMBER
