---
title: A managing partner was accused of forging an outgoing partner's signature on audit reports. It was never proven.
description: An outgoing partner accused his managing partner of forging his signature on forensic audit reports filed for two companies later referred to the CBI. The Board found no evidence and closed the case.
case_number: BOD 725/2024
file_number: PR/386/2020/DD/14/2021/BOD/725/2024
forum: board-of-discipline
institute: icai
decided_on: 2024-08-27
outcome: Not guilty
clauses: Item (2) of Part IV of the First Schedule
order_pdf: https://disc.icai.org/wp-content/uploads/2024/09/22.-BOD-725-2024.pdf
published: 2026-09-09
author: Jainam Shah
keywords: bod 725 2024, item 2 part iv first schedule, other misconduct, forensic audit report forgery allegation, signature forgery chartered accountant, canara bank forensic audit, board of discipline not guilty
source: /icai/board-of-discipline/bod-725-2024
---

# A managing partner was accused of forging an outgoing partner's signature on audit reports. It was never proven.

Two chartered accountants ran a forensic and statutory audit practice together, one of them
drawing a large majority of the profits. When the smaller partner resigned, he accused the other
of forging his signature on audit reports the firm had filed with a bank.[^parties]

## What happened

```timeline
Two chartered accountants run an audit firm together. One holds a large majority profit share and
manages the practice; the other works full-time as a partner, signing reports and certificates on
the firm's behalf, including forensic audits commissioned by banks and public-sector
undertakings.

The firm carries out forensic audits of two companies for a bank, concluding that the borrowers
had diverted funds and wilfully defaulted on their loans. The bank relies on those findings in a
recovery case that reaches the Delhi High Court, which refers the matter to the CBI. Both
partners are summoned as witnesses and give statements to the investigating officer.

The smaller partner resigns, citing his age, his health and the pandemic. After leaving, he
accuses the managing partner of forging his signature on the two forensic audit reports and on
several others, and alleges he was never paid his share of profits or his conveyance expenses.
The managing partner separately complains to the Institute about the outgoing partner's own
conduct after resignation.

The Institute's screening body initially finds no case to answer. The Board disagrees, calling the
allegations serious enough to examine in full, and orders a detailed inquiry.

At the hearing, the outgoing partner produces one forged report he says he obtained from a former
article and correspondence with two bank branches about several others. He tells the Board he has
nothing further to add and will accept whatever it decides. Finding no evidence corroborating the
forgery or any of the other allegations, the Board holds the managing partner not guilty and
closes the case.
```

Two pieces of documentary evidence decided the case, and neither helped the complaint.

The first was a forensic audit report of a third company that the outgoing partner said had been
forged by an office employee on the managing partner's instruction, based on what a former article
trainee had told him. The Board compared the signature on it with the outgoing partner's signature
on his own Form-I registration and found the two "apparently matched" (para 12).

The second was correspondence with a bank. The outgoing partner had written to two branches of a
public-sector bank asking for the original copies of five forensic audit reports, saying his
signature on them had been forged. The bank replied that the signatures were his, but added that
without KYC records for every partner and employee of the firm, it could not verify who had
actually signed. It also declined to hand over the reports themselves, treating them as its own
records (para 13).

## The charge

- **Item (2) of Part IV**, read with Section 22 — the First Schedule's residual clause for other
  misconduct, used when the conduct alleged does not fit one of the specific duties listed
  elsewhere in the Schedule.[^item2]

The complaint went well beyond the forgery allegation. It also accused the managing partner of
withholding the outgoing partner's share of profits and conveyance expenses, refusing to accept
his resignation, and using improper means to win audit assignments from nationalised banks and
government companies. All of it was examined under this one clause, and all of it failed for the
same reason: no evidence beyond the accusation itself.

## What the respondent said

The managing partner's defence was that every one of the seven forensic audit reports at issue had
been signed by the outgoing partner himself and handed to office staff for dispatch to the banks
concerned, with the office copies kept locked inside the outgoing partner's own cabin — a claim
backed by an affidavit from the office administrator (para 4).

On the two reports referred to the CBI, he pointed out that both had been signed by the outgoing
partner and countersigned by another partner, and that the investigating officer had summoned both
of them as witnesses under Sections 160 and 161 of the Code of Criminal Procedure. When the
outgoing partner later wrote to the managing partner describing the statement he had given to the
CBI, he said he had not personally carried out the audit work — but at no point denied signing the
reports (para 6). Forgery, the managing partner argued, was in any case a criminal allegation
outside the Institute's jurisdiction (para 7).

On the money and the resignation, he denied owing any profit share or conveyance reimbursement,
and denied ever refusing to accept the resignation — the outgoing partner, he said, was staying on
of his own will only to settle an advance. He also denied any malpractice at the firm, noting it
had never been blacklisted by any regulator, and said a separate complaint of his own was already
before the Institute over the outgoing partner's conduct after leaving, including allegations of
extortion, withheld client documents and an unpaid advance (para 8).

## What the Board held

On the forgery allegation, the Board weighed what evidence the outgoing partner had actually
produced. The one report he placed on record bore a signature that matched his own Form-I
signature (para 12). The bank correspondence confirmed the signatures on the other reports were
genuinely his, and the Board noted that the bank's inability to verify authenticity stemmed only
from a lack of KYC data on the firm's partners — not from any finding that the signatures were
forged (para 13). On the money and resignation, it found nothing beyond a single email asking for
information about the profit share, and a resignation letter that gave age, health, the pandemic
and commute as the reasons for leaving, with no mention of forgery or unpaid dues (para 14). Five
further allegations of malpractice were listed but none carried supporting evidence (para 15).

At the hearing the outgoing partner told the Board he had nothing more to say and would accept its
decision, and that he agreed with the Institute's original screening opinion (para 16). The Board
concluded:

> in absence of any corroborative evidence for any charge against the Respondent, in the
> considered opinion of the Board, the Respondent is 'Not Guilty' of Other Misconduct falling
> within the meaning of Item (2) of Part- IV of First Schedule to the Chartered Accountants Act,
> 1949 (para 17)

## The order

> Accordingly, the Board passed an order for closure of the case in terms of the provisions of
> Rule 15 (2) of the Chartered Accountants (Procedure of Investigations of Professional and Other
> Misconduct and Conduct of Cases) Rules, 2007 (para 17)

No punishment stage follows a not-guilty finding. The Board closed the complaint outright.[^rule]
It had earlier declined to accept the Institute's own screening opinion and ordered the full
inquiry itself, before reaching the same conclusion on the merits.[^coram]

## Why it matters

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

**A bank confirming a signature is yours is not the same as it confirming who else could have
used it.** The bank here said the signatures matched the outgoing partner's, and that alone
sank the forgery claim — the missing KYC data it also mentioned was not read as suggesting
forgery. Do not expect a "we can't fully verify" caveat to carry a claim it was never meant to
support.

**A resignation letter is read literally, later.** The letter here gave age, health, the pandemic
and commute as reasons for leaving. When forgery and unpaid dues were raised only afterwards, the
Board treated the letter's silence on them as evidence against the claim. Write your real reasons
into the letter if you expect to rely on them later.

**Naming the criminal-law question does not settle the professional-misconduct one.** The
managing partner argued forgery was a matter for the courts, not the Institute — but the Board
still examined the evidence on its own merits rather than declining jurisdiction. A disciplinary
body will look at the same facts regardless of what else they might also support.

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

[^parties]: The complainant was *CA. Jayesh Vasantlal Shah (M. No. 041495)* of Mumbai, a
    full-time partner in the respondent's firm. The respondent was *CA. Jaleshwar Singh (M. No.
    042023)*, Managing Partner with an 80% profit share in *M/s J Singh & Associates (FRN
    110266W)*, Mumbai — the firm both belonged to.

[^item2]: Item (2) of Part IV of the First Schedule, read with Section 22 of the Chartered
    Accountants Act, 1949, is a residual clause: a member is guilty of Other Misconduct if, in
    the opinion of the Council, conduct — whether or not connected with professional work —
    brings disrepute to the profession or to the Institute.

[^rule]: Rule 15(2) of the Chartered Accountants (Procedure of Investigations of Professional and
    Other Misconduct and Conduct of Cases) Rules, 2007 directs the Board, on finding a member not
    guilty, to record that finding and order the complaint closed. There is no punishment hearing.
    The final hearing in this matter was held on 26 June 2024 at ICAI Bhawan, Mumbai; the
    respondent had also filed his own complaint against the complainant, recorded separately under
    file PR/88/2021/DD/125/2021.

[^coram]: The findings were signed by CA. Rajendra Kumar P (Presiding Officer), Ms. Dolly
    Chakrabarty, IAAS (Retd.) (Government Nominee) and CA. Priti Savla (Member).