Threatening a client constitutes professional misconduct under the Chartered Accountants Act, 1949.

Pradeep Nandrajog, J.

1. The reference made to this Court by the Institute of Chartered Accountants under Section 21(5) of the Chartered Accountants Act, 1949 has reached for hearing today. Whereas counsel as above appear for the Institute of Chartered Accountants, the first respondent who is the contesting respondent has not appeared.

2. With the able assistance of Sh. Rakesh Aggarwal, Advocate we have gone through the record commencing from the complaint received against the first respondent till the final recommendation made to this Court by the Council Members at the meeting held on September 20 and 21, 2010 recommending penalty of reprimand, contemplated by Section 21(6)(b) of the Chartered Accountants Act, 1949 to be inflicted.

3. One S.K. Garg made a complaint on January 31, 2006 against the respondent alleging that the complainant had engaged the services of the respondent to file his personal and his family members income tax returns and as and when called upon to pay professional charges the complainant used to pay the professional charges and was surprised to receive a bill from the respondent on November 10, 2004 demanding a sum of Rs.3.8 lacs as professional fee for filing the returns of the complainant for 19 years commencing from the financial year 1985-86 till the financial year 2004-05. The bill was raised @ Rs.20,000/- per annum. As per the complainant the bill was accompanied by a threatening written communication which was alleged to be unethical the communication contained a threat to initiate legal action and with a limb informing the complainant that for the year 2004-05 the learned Assistant Commission Income Tax desired to verify the details of the loans stated to have been advanced by the complainant’s mother Shanti Devi. As per the complainant the learned Assistant Commissioner of Income Tax had not passed any order to said effect. A copy of the communication was alleged by the complainant to have been sent to the CMD of National Hydro Power Corporation. It was further alleged by the complainant that the respondent solicited professional work through personal communications.

4. The complaint was taken cognizance of. A Disciplinary Committee was constituted which heard the complainant and the respondent and the evidence placed on record by the complainant.

5. Noting that there was evidence to establish that the respondent was filing the income tax returns of the complainant and his family members, the Committee noted that the respondent had filed a Civil Suit for recovery of the professional outstanding dues and the issue was sub-judice. The Committee noted that along with the bill dated November 10, 2004 a written communication was sent in which it was written that if the payment was not made the respondent shall initiated legal proceedings against the complainant and that the Assistant of Income Tax has desired to verify the details of the loans concerning Ms. Shanti Devi.

6. The Committee opined that it was strange that the respondent would raise a bill for 19 years services rendered in the year 2004 and found no explanation from the respondent as to why for each year as and when professional services were rendered a bill was not raised. Finding no proof by the complainant that he had paid professional charges, the Committee did not delve any further on the merits of the dispute concerning Rs.3.8 lacs payable towards professional services rendered. Though no reasons have been expressly stated as to why the Committee left it at that, by noting the facts and making prima-facie observations, the reason appears to be that the dispute was a civil dispute and was sub-judice. But, with respect to the written communication appended by way of note to the bill, the Committee opined that the language was threatening and not expected of a Chartered Accountant who is looked upon by the society as a dignified professional. The threat pertaining to the second part of the note was found to be a wee bit aggrava