---
title: A partner joined a firm a day after its senior partner died. The widow accused the new partner of withholding accounts.
description: A widow said the partner who joined her late husband's firm the day after his death withheld its accounts. The Board cleared him of the only allegation it heard.
case_number: BOD 737/2024
file_number: PR/421/2022/DD/284/2022/BOD/737/2024
forum: board-of-discipline
institute: icai
decided_on: 2024-07-06
outcome: Not guilty
clauses: Item (2) of Part IV of the First Schedule
order_pdf: https://disc.icai.org/wp-content/uploads/2024/07/17.-BOD-737-2024.pdf
published: 2026-09-09
author: Jainam Shah
keywords: bod 737 2024, item 2 part iv first schedule, other misconduct board of discipline, deceased partner accounts, legal heir goodwill claim, partnership act section 12(e), board of discipline not guilty
source: /icai/board-of-discipline/bod-737-2024
---

# A partner joined a firm a day after its senior partner died. The widow accused the new partner of withholding accounts.

A chartered accountant died, still running his firm's head office out of his own private premises.
A partnership deed drawn up the very next day brought in a new partner, and his widow — the
deceased's legal heir — complained to the Institute that she had never been shown the accounts of
what was owed to his estate.[^parties]

## What happened

```timeline
A Chennai chartered accountant builds a firm over several decades, first as a sole proprietor and
then as a partnership, running its head office out of his own private premises. Several more
chartered accountants join him as partners along the way.

He dies. A partnership deed drawn up the very next day brings in a new partner, one who had never
held that position while the founder was alive, and the founder's affairs pass into dispute between
the new partner and the founder's widow, his legal heir.

The widow takes a string of allegations to the Institute. She says the new partner falsely claimed
to have taken over her husband's personal practice, that the reconstituted partnership deed was
signed without her consent and carried forged signatures, and that her husband's digital signature,
hard drive and personal diary were taken without permission. She also says the firm's bank account
was opened to the new partner before her husband's death certificate was even issued, that a
decades-old landline from his private office was later switched into the new partner's name, that a
family-owned entity of his took over fee-billing work that should have been hers, and that a
criminal complaint was filed against her son.

A screening opinion examines every one of those allegations and clears the new partner of all but
one — that the firm never handed over audited financials, a bank reconciliation or a full ledger of
fee receivables to let the widow work out her share of the practice. The Board takes up the case on
that single allegation alone, against a deadline the Madras High Court set after the widow herself
petitioned it over the delay.

A hearing goes ahead despite a last-minute request to adjourn it, since granting one would have
breached the High Court's own deadline. The Board weighs what the partnership deed says about
goodwill, what the widow was actually given to inspect, and what the law requires of a firm settling
a deceased partner's affairs.
```

Only one of the eight allegations ever reached a hearing. A screening opinion, examining each claim
on its own, found no case to answer on any of them except whether the firm had given the widow
proper accounts of her husband's practice — and it was that allegation alone the Board went on to
hear, under the twelve-week deadline the Madras High Court had set.[^timeline]

What was actually in dispute, once the case narrowed that far, was not a missing document but a
legal entitlement: whether a partner's widow has any claim to a firm's goodwill at all, and whether
the law required the firm's financials to be audited before she saw them.

## The charge

- **Item (2) of Part IV, read with Section 22** — the First Schedule's general clause for "other
  misconduct." It has no fixed list of acts; it catches whatever conduct discredits the profession,
  once no more specific item fits.[^item2]

The widow's complaint had run to eight separate allegations — misrepresentation, forged signatures
on the reconstituted partnership deed, misuse of her husband's digital signature, a takeover of his
bank account and landline, a rival billing entity, and a criminal complaint against her son. A
screening opinion cleared the new partner of all of them but the one about accounts, and it was that
allegation alone the Board went on to hear.[^screening]

## What the Board held

The widow's underlying grievance was that she had never received her due share of her husband's
practice, including its goodwill. The Board turned first to the Institute's own Code of Ethics,
which sets out when a partner's legal heir can claim a share of a firm's goodwill at all:

> When there are two or more partners and one of them dies, the widow of the deceased partner can
> continue to receive a share of the profit of the firm. A legal representative, say widow of a
> deceased partner, would be entitled to share the profits only where the partnership agreement
> contains a provision that on the death of the partner his widow or legal representative would be
> entitled to such payment for goodwill by way of sharing of fees or otherwise for some specified
> period. (para 8)

The firm's own partnership deed, the Board found, carried no such clause. On that ground alone, the
widow had no claim to the firm's goodwill (para 8).

The Board also noted what was not in dispute: the new partner had never held that position while the
founder was alive. He became a partner only from the day after the founder's death (para 9).

On the accounts themselves, the Board found the widow had already been given more than the complaint
acknowledged — extracts of her husband's ledger account and of the Legal Executor's, and an
opportunity to inspect the firm's books herself (para 10).

What she wanted beyond that, the Board held, the law did not require. Section 12(e) of the
Partnership Act, 1932 gives a legal heir the right to inspect and copy a firm's books, but it does
not oblige the remaining partners to get those books audited first, and the partnership deed here
was itself silent on any duty to audit. On that reading, the Board held:

> the Board is of the view that the Respondent cannot be held responsible and thus 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 in respect of this allegation (para 11)

## The order

> Thus, in conclusion in the considered opinion of the Board, the Respondent is held 'NOT GUILTY' of
> Other Misconduct falling within the meaning of Item (2) of Part-IV of First Schedule to the
> Chartered Accountants Act, 1949. 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 12)

No punishment stage follows a not-guilty finding.[^rule] The final hearing was held in person at
ICAI Bhawan, Chennai, and the findings were signed by the same Board that heard it.[^coram]

## Why it matters

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

**A right to inspect accounts is not a right to demand an audit.** The widow could see the books and
get copies of the ledger; the law did not additionally require the firm to have them audited before
handing them over. Know the difference between the two before you frame a complaint around either.

**Goodwill for a deceased partner's heir depends on what the partnership deed actually says.** The
Code of Ethics ties any claim to a specific clause in the deed, not to the relationship. Check the
deed itself before assuming an entitlement follows automatically from being a legal heir.

**A screening stage can settle most of a complaint before anyone argues it.** Seven of the widow's
eight allegations never reached a hearing at all. Build a complaint around the allegation that
survives screening, and expect the rest to be tested at that earlier stage, not the one you plead
for.

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

[^parties]: The complainant was *Mrs. Pritha Ponraj, Chennai*, widow and legal heir of *CA. S.
    Ponraj*, who founded and ran *M/s Ponraj & Co., Chartered Accountants* until his death. The
    respondent was *CA. K Venkatraman (M. No. 237034)*, who joined the firm as a partner the day
    after CA. Ponraj's death.

[^item2]: Item (2) of Part IV of the First Schedule, read with Section 22 of the Chartered
    Accountants Act, 1949, covers "other misconduct" — conduct that discredits the profession but is
    not captured by the more specific items listed elsewhere in the Schedule.

[^screening]: The eight allegations were: misrepresenting a takeover of the deceased partner's
    personal practice; failing to account for the widow's share of profits and fees; taking the
    reconstituted partnership deed without her consent and with forged signatures; misusing the
    deceased partner's digital signature and removing his hard drive and personal diary; taking over
    the firm's bank account and its authorised phone number before the death certificate issued;
    switching a decades-old landline into the respondent's name; diverting secretarial fee income to
    a firm owned by the respondent's family member; and filing a criminal complaint against the
    complainant's son. The Director (Discipline)'s Prima Facie Opinion, dated 19th April 2024, found
    a case to answer only on the second of these, and the Board's hearing proceeded on that basis
    alone.

[^timeline]: The complainant had petitioned the Madras High Court over delay in the investigation.
    The High Court disposed of that petition on 22nd April 2024, directing the Director (Discipline)
    to complete the process and pass final orders within twelve weeks. Hearing notices went out on
    28th May 2024; the complainant's request on 6th June 2024 to adjourn the 12th June 2024 hearing
    by six weeks — which would have breached the High Court's deadline — was rejected. The final
    hearing was held on 12th June 2024 and the findings were signed on 6th July 2024.

[^rule]: Rule 15(2) of the Chartered Accountants (Procedure of Investigations of Professional and
    Other Misconduct and Conduct of Cases) Rules, 2007 — where the Board finds a member not guilty,
    it records the finding and orders the complaint closed. There is no punishment hearing under
    Section 21A(3).

[^coram]: CA. Rajendra Kumar P (Presiding Officer), Ms. Dolly Chakrabarty, IAAS (Retd.) (Government
    Nominee) and CA. Priti Savla (Member), all present in person at ICAI Bhawan, Chennai.