---
title: A chartered accountant changed a sworn statement to investigators. Years on, the accountant was reprimanded and fined.
description: A Chennai accountant changed a sworn statement given to the Serious Fraud Investigation Office, during an inquiry into companies he had incorporated. The Board reprimanded and fined him, years later.
case_number: BOD 468/2018
file_number: PR/283/2016/DD/14/2017/BOD/468/2018
forum: board-of-discipline
institute: icai
decided_on: 2020-01-06
punished_on: 2024-05-20
outcome: Fine
clauses: Item (2) of Part IV of the First Schedule
order_pdf: https://disc.icai.org/wp-content/uploads/2024/05/4.-BOD-468-2018.pdf
published: 2026-09-09
author: Jainam Shah
keywords: bod 468 2018, conduct bringing disrepute, item 2 part iv first schedule, section 22 chartered accountants act, sworn statement government investigator, serious fraud investigation office, board of discipline reprimand, icai vs r vinod kumar delhi high court
source: /icai/board-of-discipline/bod-468-2018
---

# A chartered accountant changed a sworn statement to investigators. Years on, the accountant was reprimanded and fined.

A Chennai chartered accountant helped incorporate four private companies with the Registrar of
Companies, and later gave a statement on oath to the Serious Fraud Investigation Office about
them.[^parties] The accountant then changed that statement, and the Institute's Board of Discipline
held that the change alone brought disrepute to the profession — regardless of what role, if any,
the accountant had actually played in auditing the companies concerned.

## What happened

```timeline
A Ministry of Corporate Affairs investigator complains to ICAI about a Chennai chartered
accountant who had helped incorporate four private companies with the Registrar of Companies at
Chennai. One of those companies comes under scrutiny, and the Serious Fraud Investigation Office
records the accountant's statement on oath about it.

The accountant later gives a different account of the same events. The Board of Discipline finds
the accountant guilty of misconduct over the contradiction itself, holding that changing a sworn
statement suggests hiding facts and misleading a government authority — even though the record
shows the accountant was never actually the statutory auditor of the company under investigation.

Given a chance to be heard on punishment, the accountant appears before the Board in person and
presses a string of objections: to how the Board was constituted, to the legal force of a
statement recorded by investigators, and to punishing a family's sole earner over a first
complaint in twenty years of practice.

The Board rejects every objection and confirms the finding. Recording the punishment itself takes
far longer: the order comes down nearly four years after the hearing, and only after a Delhi High
Court order in a writ petition naming the accountant among its respondents.

The Board reprimands the accountant and imposes a fine of ₹25,000, payable within sixty days.
```

The finding did not turn on which company the accountant had audited. It turned on a single fact:
the accountant told the Serious Fraud Investigation Office one thing and later told it something
else. The Board treated that alone as conduct unbecoming of a chartered accountant (para 4(c)).

Four companies were named in the complaint,[^companies] but only one of them mattered to the
charge — the company for whose financial year 2009-10 the accountant was said to have made
contradictory statements. The Board itself recorded that there was no evidence the accountant had
ever been its statutory auditor, and held that this made no difference to the finding (para 4(c)).

## The charge

The Board found the accountant guilty of "Other Misconduct" under Clause (2) of Part IV of the
First Schedule to the Chartered Accountants Act, 1949, read with Section 22 of the Act — a
residual clause for conduct that brings disrepute to the profession, wider than any of the
specific items listed elsewhere in the Schedule.[^disrepute]

## What the respondent said

The accountant raised five objections going to the legality of the proceedings themselves, and
four more going to fairness and consequence.

On jurisdiction, the accountant argued that only the Council of the Institute — not the Board of
Discipline — has the power to form an opinion under the disrepute clause, since the Act speaks of
"the opinion of the Council". On composition, the accountant argued that the Findings had no legal
force because they were signed by only two of the Board's members, when Section 21A of the Act
contemplates a three-member Board.

On the statement itself, the accountant argued that it was a nullity: even the Serious Fraud
Investigation Office, in the accountant's submission, had no power under Section 240 of the
Companies Act, 1956 to record it, and in any event the accountant had derived no benefit and
avoided no danger by giving it. The accountant also argued that the Findings were internally
inconsistent — if the accountant was never the statutory auditor of the company in question, that
undercut the very charge against the accountant — citing the Supreme Court's decision in
*Dhirajlal Girdharilal v. CIT, Bombay*, (1954) 26 ITR 736, and disputing the proposition that
changing a statement shows a person is hiding facts.

On consequence, the accountant pointed to twenty years of practice with no prior complaint, no
prejudice caused to the investigation and no benefit gained from the acts alleged, and to being
the sole earner for a family that included a spouse and three school-going children, whose
livelihood depended entirely on the accountant's practice as a chartered accountant.

## What the Board held

On jurisdiction, the Board relied on an earlier ruling of the Appellate Authority, which had
already held — in a batch of appeals against the Institute — that the Director (Discipline)'s
Prima Facie Opinion is what sets the disciplinary machinery in motion, and that "the opinion of
council" in the disrepute clause "has to be given a purposive meaning" rather than read as
requiring a separate opinion from the Council itself (para 4(a)).[^appeals]

On composition, the Board pointed to its own procedural rules:

> The quorum for any meeting of the Board of Discipline shall be two members. (Rule 13(2), quoted
> at para 4(b))

and held that the Findings, signed by two members, suffered from no illegality.

On the merits, the Board accepted that there was no evidence the accountant had been the statutory
auditor of the company for the year in question, but held that this did not matter:

> the said fact does not in any way mitigate the misconduct on the part of the Respondent in
> respect of the charge alleged. The Respondent being a professional was expected to come clean
> before making any statement on oath to Government Authorities. Further changing of statement
> proves that a person is hiding facts and trying to mislead the Government authorities. (para
> 4(c))

and concluded:

> it has already been conclusively proved that [the Respondent] is Guilty of Other Misconduct
> falling within the meaning of Clause (2) of Part IV of the First Schedule of the Chartered
> Accountants Act, 1949 read with Section 22 of the said Act.[^bracket] (para 4(c))

## The order

> the Board decided to reprimand [the Respondent] and also imposed a fine of
> Rs.25,000/- (Rs. Twenty five thousand only) upon him payable within a period of 60 days from the
> date of receipt of the Order.[^bracket] (para 5)

That sanction was fixed by a Board sitting through video conferencing, after hearing the
accountant in person on the question of punishment.[^coram] A reprimand together with a fine sits
above a reprimand on its own on the Board's punishment
scale, and well short of removal from the Register. The Findings were recorded in January 2020 and
the accountant was heard on punishment that September, but the order fixing the punishment itself
was issued only in May 2024 — pursuant, the order records, to a Delhi High Court order made weeks
earlier in a writ petition naming the accountant among its respondents.[^writ]

## Why it matters

*This section is ours, not the Board's.*

**A changed statement can be the whole case.** The Board did not need to decide what the accountant
actually did at the company under investigation — only that the account given to investigators
changed. Whatever you tell a government authority under oath, be prepared to stand by it without
alteration.

**A weak link in the underlying facts does not weaken the actual charge.** The Board accepted the
accountant was never the statutory auditor in question, and held that this changed nothing, because
the charge was about the statement, not the audit. Answer the charge that was actually made, not
the one that would be easiest to defend.

**A procedural objection is only as good as its novelty.** Both the jurisdiction argument and the
composition argument here had already been settled by an appellate ruling and by the Board's own
rules before the case was even heard. Check whether your objection has already been decided against
you elsewhere before relying on it.

**A finding of guilt does not go stale while punishment waits.** Four years passed between the
Findings and the order recording the punishment, and the fine still landed. Treat a pending
disciplinary finding as live until an order actually disposes of it.

This summarises a public order and links the primary source. It is general information, not legal
or professional advice.

[^parties]: The complainant was Shri Rishi Goel, Additional Director (Investigation), Ministry of
    Corporate Affairs. The respondent was *CA. R. Vinod Kumar (M.No. 206820)*, in practice at
    Chennai.

[^companies]: The complaint concerned the accountant's role in incorporating four private
    companies with the Registrar of Companies, Chennai: M/s Unigateway2U Trading Pvt. Ltd., M/s
    Unipay2u Production Pvt. Ltd., M/s Unipay Creative Business Pvt. Ltd. and M/s GODINDEX Tours
    and Travels Pvt. Ltd. Only the first of these — for financial year 2009-10 — was material to
    the charge; the Board recorded no finding of misconduct concerning the other three.

[^disrepute]: Clause (2) of Part IV of the First Schedule to the Chartered Accountants Act, 1949
    covers a member found guilty of any act or omission that brings disrepute to the profession or
    the Institute, whether or not it falls under any other specific clause of the Schedule. It is
    read with Section 22 of the Act, which defines "professional or other misconduct".

[^bracket]: The order names the respondent in full at these points, and in the operative sentence
    gives his membership number alongside the name. Both are replaced by the bracketed phrase for
    the same reason: a membership number identifies a member as surely as a name does. Nothing
    else in these quotations has been altered.

[^appeals]: The Appellate Authority decided the point in a batch that included the appeals of
    *Gyan Prakash Agarwal*, *Rajiv Maheshwari* and *Sameer Kumar Singh v. ICAI*. None of them is
    the respondent in this case; they are cited because the Board adopted their reasoning.

[^writ]: The order states that it "is issued pursuant to the Order dated 29th April 2024 passed by
    Hon'ble High Court of Delhi in W.P.(C) 5247/2024 namely ICAI Vs R. Vinod Kumar & others." The
    PDF gives no further detail of that writ petition or of what it decided.

[^coram]: The punishment order was passed, through video conferencing, by a Board of CA. Prasanna
    Kumar D (Presiding Officer) and Mrs. Rani Nair (IRS, Retd.) (Government Nominee). The Findings
    of 6 January 2020 do not state their own coram in this document.