THE COUNCLL OF THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA & ANOTHER versus B. MUKHERJEA

Citation: [1958] 1 S.C.R. 371 · Decided: 10-09-1957 · Supreme Court of India · Bench: NATWARLAL HARILAL BHAGWATI · Disposal: Appeal(s) allowed

Judgment (excerpt)

S.C.R. SUPREME 
COURT 
REPORTS 
371 
proceedings adopted by him in the present litigation 
1957 
he was probably not advised to make a proper appli-
Kanai Lal Sur 
cation under s .. 5. sub-s .. (2) of the Ordinance; but that 
Para';;;nidhi 
is the only protection that he and judgment-debtors of 
sadhukhan 
his class were entitled to after the amending Ordinance c . d-dk J 
of 1952 came into force. It would, therefore, not be 
a,en raga 
ar . 
reasonable to complain that no protection whatever 
has been given to this .class of thika tenants. It may 
be that the extent of the protection now afforded to 
this class may not be as wide as it originally was 
under s. 28 of Act II .of 1949 but the deletion of s. 28 
clearly indicates that the Legislature wanted to revise 
its policy in this matter. The position, therefore, is 
that the conclusion which follows from a reasonable 
construction of s. 5, sub-s. (1) is corroborated by the 
"deletion of s. 28 from the Act and by the provision of 
s. 5, sub-s. (2) of the amending Ordinance of 1952 and 
s. 9 of the amending Act VI of 1953. We must, 
accordingly, hold that the Calcutta High Court was 
right in rejecting the appellant's argument that civil 
courts had no jurisdiction to entertain the execution 
petition filed by the respondent against the appellant. 
Jn the result, the appeal fails and must be dismissed 
with costs. 
· 
Appeal dismissed. 
THE COUNClL OF THE INSTITUTE OF 
CHARTERED ACCOUNTANTS OF 
INDIA & ANOTHER· 
1'. 
B. MUKHERJEA 
(BHAGWATI, S.K. DAS and GAJENDRAGADKAR, JJ.) 
Chartered Accou11(ant-Misco11d11ct during appoimment as 
liquidator by 
Court-~/' amounts to prof'essional . misconduct-
Reference-Po\l'er ff' High Court-Chartered Acco1111ta11ts Act, 1949 
(XXXV/JI of 1949) s.1·. 2(2), 21 and 22. 
Respondent, a chartered accountant and a member of the 
Institute of Chartered Accountants. 
was appointed liquidator of 
three insurance companies in pursuance of the orders of the High 
1957 
September 10 
372 
SUPREME COURT REPORTS 
[1958J 
1957 
Court. He received records, ·cash and securities on behalf of these 
h C 
.1 if h companies. The Assistant Controller of Insurance found that his 
1;~t~tut~u:J'ch0:1:,._ conduct as liquidator was wholly 
unsatisfactory and. that ~e 
ed Accountants of would not even reply to the letters addressed to him. 
His 
India & Another appointment was cancelled and another person was appointed. 
v. kh . 
In spite of repeated demands he failed to return all the records, 
B. Mu erJea cash and securities. A complaint was lodged against him with 
Gajendragadkar J. the Council of the Institute of Chartered Accountants. After 
inquiry the respondent was found guilty of misconduct, and the 
report was forwarded by the 
Council to the High Court for 
necessary action under s. 21 of the Chartered Accountants Act, 
1949. · The High Court rejected the reference on the ground that 
the conduct of which the respondent was found guilty could not 
be said to be professional misconduct and did not attract the 
provisions of ss. 21 and 22 of the Act. 
Held, that the respondent, when working as a liquidator, 
must be deemed to have been in practice as a chartered accountant 
within the meaning of s. 2(2) of the Act. The definition of -
misconduct in s. 22 is inclusive and the Council may hold 
an 
inquiry and find a member guilty of conduct which, in its opinion, 
renders him unlit to be a member of the Institute, even though 
such conduct does not attract any of the provisions of the schedule 
referred to in s. 22. The conduct of the respondent was 
grossly improper and unworthy and amounted to professional 
'misconduct within the meaning of the Act. 
In a reference under s. 21 of the Act the High Court has 
ample powers to adopt any course which would enab\e it to do 
complete justice between the parties. 
It can examine the 
correctness of the findings recorded by the Council or refer the 
matter back for further inquiry and call for a fresh finding. 
The 
High Court is not bound to deal with the merits of the finding as 
ii has been recorded and either to accept or reject it. 
C1v1L 
APPELLATE 
JURISDICTION: 
Civil Appeal 
No. 170 of 1956. 
Appeal by special leave from the judgment and 
order dated the 12th January, 1955, of the Calcutta 
High Court in exercise of its Special Jurisdiction under 
the Chartered Accountants Act, 
1949, in Matter 
No. 107 of 1954. 
M.C. Setalvad, Attorney-General for India, S.N. 
Andley, J.B. Dadachanji and Rameshwa

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