Judgment HEMANT GUPTA, J. Present is a reference under Section 21(5) of the Chartered Accountants Act, 1949 (for short the ‘Act’) calling upon this Court to pass an order in terms of the Section 21(6) of the Act. The disciplinary proceedings against the respondent-Rajesh Chadda, Chartered Accountant was initiated on the basis of a Complaint under Section 21 of the Act, received from Commissioner, Central Excise Chandigarh-II Chandigarh against the respondent herein. Considering the aforesaid complaint, the Council of Chartered Accountants of India (for short the 'Council') under the Act referred the case to the Disciplinary Committee for inquiry in its meeting held from 19th to 22nd April 2005. The complaint was that during audit of M/s Ashwin Fabrics (P) Ltd., Amritsar by Central Excise Commissionerate from 14.6.1999 to 16.6.1999, the Central Excise Officers came across two sets of balance sheets prepared and signed by the same Chartered Accountant i.e. the respondent herein. One set of balance sheet was prepared for Income Tax Department and another for Central Bank of India. In the two such balance sheets there is a difference of three crores in the entry pertaining to sale of stocks. It was mentioned in the complaint that the respondent was summoned under Section 14 of the Central Excise Act, 1944. He accepted that both these balance sheets were prepared and signed by him. One set shows sale of Rs. 53731031.35 (Page 146 of the present paper book) and second set shows the sale of Rs. 84676031.35 (Page 164 of the present paper book ). The respondent was asked to explain such balance sheets. He stated that the balance sheets reflecting the sale figure of Rs. 84676031.35 has been prepared, on the request of management of the company on the basis of Monthly Operating Statement submitted to the Bank. In these circumstances, the action against the Chartered Accountant was sought in the complaint dated 29.10.2002, wherein it was claimed as under:- 6. It is therefore, requested that appropriate action may be initiated against Shri Rajesh Chadha, C.A.M No. 92937 of M/s Rajesh Chadha & Associated Chartered Accountant, 979-A, Gali Gujrain, Katra Bhai Sant Singh, Amritsar for professional mis-conduct act, for preparing & signing two sets of Balance Sheets showing different sale and purchase figures of the same company of M/s Ashwin Fabrics (P) Ltd., Amritsar for the period ended as on 31.3.1998, one of which is apparently false. In the reply filed to the complaint before the Council, the respondent admitted having made statement before the Central Excise Authorities but asserted that he ought to have taken due caution while tendering statement before the Central Excise Department. It was stated to the following effect: 2. .... The respondent truthfully accepts that he ought to have taken due caution while tendering his statement before the Central Excise Authorities but the respondent was under tremendous pressure so much so that seeking the adjournment only for one time resulted a letter informing that the matter of his non-appearance would be taken up with the Institute of Chartered Accountants and on the another side the involvement of his two senior professional brethren as the director of the said party as well as a handsome shareholding of both of them and their respective families, namely Shri Kapil Aggarwal, chartered Accountant and Shri Vijay Umat, Chartered Accountant. The mental state of affairs at such times cannot be explained in words and being so much under pressure the respondent was made to give tailor-made answers to the pre-decided questions. It was found from the documents enclosed with the complaint that both the sets were same but only one sheet was different with the signature appearing as made by the respondent. The said sheet titled as “Manufacturing & Trading & Profit & Loss A/c' is on a differently printed stationery which was being used by the office of the respondent in earlier years. This can be verified only from the style and phone numbers printed on the right hand corner at top as compared with the rest of the papers forming part of the balance sheet. The respondent has no knowledge as to how and in what manner this sheet has been used. The rubber stamp affixed on that paper is also different and is similar to the one the office of the respondent had been using in earlier years. However, the truth camt into the knowledge of the respondent when he thoroughly examined the so called two set of balance sheets, received from the Institute along with the complaint for filing the written statement. The respondent while tendering his statement before the Central Excise Authorities was very upset as any human being can be who has never faced any enquiry like that through out his life. The respondent while tendering his statement before the Central Excise Authorities was very upset as any human being can be who has never faced any enquiry like that through out his life. This is the only reason that he could not detect the single paper having such a major discrepancy out of many papers shown to him. The Deputy Commissioner, Central Excise filed rejoinder to the reply submitted by the respondent. The respondent filed reply to the rejoinder on 26.6.2004, so submitted. Thereafter, the respondent did not appear before the Disciplinary Committee of the Council and report dated 3.2.2008 was submitted for consideration of the Council. The Disciplinary Committee recorded the following findings in its report: 15. First of all, the Committee is unhappy with the conduct/behavior of the respondent with respect to the proceedings of the Disciplinary Committee. Four opportunities were given to the respondent to appear before the Committee but every time he informed that he needed various documents and witnesses and without the documents and witnesses as required by him, he would not appear. The office informed the respondent to appear before the Committee and explain the Committee about the relevance of calling such a large number of witnesses and the documents. But neither he appeared before the Committee nor explained the relevance of calling such witnesses and also the relevance of seeking such documents. 16. The Committee noted that there were two sets of Balance Sheets and the only difference between the two sets of Balance Sheets was in the figure of the Sales and Purchase. Further, both the Balance Sheets were duly audited and signed by the Respondent. The Committee also noted that the Respondent never denied that the signatures on both the sets of balance Sheets were not his. Though the Respondent submitted that he did not know about the second set of balance sheet in which the sales figure is inflated by Rs. 3 crore (approx.) and his statement was taken under the pressure, yet the Committee is not at all convinced with this argument of the Respondent, as the Respondent never denied this fact that on the inflated Manufacturing, Trading, Profit & Loss Account for the year ending 31st March 1997 of the Company, signatures were not his. Moreover, in the statement of the Respondent given to the Excise Department, the Respondent submitted that “the Balance Sheet reflecting sales figure of Rs. Moreover, in the statement of the Respondent given to the Excise Department, the Respondent submitted that “the Balance Sheet reflecting sales figure of Rs. 84676031.35 is prepared on the request of the Management of the Company. The Balance Sheet showing sales figure of Rs. 53731031.35 is as per audited books of account and the Balance Sheet sale figure of Rs. 84676031.35 is compiled on request of Management from Monthly Operating Statement submitted by the Management to the Bank” and the Respondent never retracted his statement given before the Department later on. The Disciplinary Committee also noticed that on the basis of the balance sheet, submitted by the Company, duly authenticated by the Chartered Accountant, the loan was sanctioned by the Bank and that respondent has failed to put in appearance nor the witnesses cited by them have been examined. He has failed to bring in evidence to prove his bona fide conduct in the entire matter. It thus concluded as under : 18. ....The Committee noted that the Respondent failed to bring any evidence on record to prove his bonafide conduct in the entire matter. Moreover, he even failed to appear before the Committee. The Committee is convinced that the Respondent has signed two sets of Balance Sheet on the request of the Management. Therefore, the Committee is of the opinion that the Respondent is guilty of professional misconduct falling within the meaning of Clauses 5,6, & 7 of Part I of the Second Schedule under Section 22 read with Section 21 of the Act. A copy of the said report was sent to the respondent. He submitted his response on 6.4.2009 and another set on 12.4.2009. In the communication dated 12.4.2009, respondent sought the Council to examine inter alia the following facts: - “a) That I never signed two different balance sheets as alleged. b) That the said balance sheets were recovered by the complainant authority from the managing director of the company of which I audited the account, and not from me. c) That the sheet titled as “Manufacturing & Trading & Profit & Loss Account” attached with the balance sheet alleged to have been signed by me with inflated figures was on different stationary and with different rubber stamp as compared to all other sheets used for balance sheet. c) That the sheet titled as “Manufacturing & Trading & Profit & Loss Account” attached with the balance sheet alleged to have been signed by me with inflated figures was on different stationary and with different rubber stamp as compared to all other sheets used for balance sheet. d) That as per reports of Handwriting and Finger Experts, which I have obtained, the signature alleged to be of mine does not tally with my signatures. In fact, they were on the list of witnesses which was submitted to Disciplinary Committee for summoning them but the Disciplinary Committee did not grant my request. e) That the Disciplinary Committee has not provided me the proper opportunity to present my case; my representations have been overlooked and not considered.” The Council considered the report of the Disciplinary Committee and the representation submitted in its meeting held on 18.4.2009. It was recorded that neither the respondent nor his authorized representative was present to appear before the Council for making oral submissions. It was concluded as under: - “9. The Council considered the Report of the Disciplinary Committee along with the written representation dated 6.4.2009 to 12.4.2009 received from the Respondent before it. The Council noted that in the instant case, the Respondent had signed two different sets of Balance Sheets for the Financial Year ending on 31st March 1998 on the request of the Management of the Company. Out of the two sets, one set was submitted to the Income Tax Department and another set was submitted to the Central Bank of India, Amritsar. The Council also noted that the said Bank sanctioned the cash credit facility on the basis of the Balance Sheet wrongly authenticated by the Respondent. The Council condemned such an act on the part of a professional which brings disrepute to the profession. The Council thus accepted the Report of the Disciplinary Committee and decided that the Respondent was guilty of Professional Misconduct falling with the meaning of Clauses (5), (6) & (7) of Part I of the Second Schedule under Section 22 read with Sections 21 of the Chartered Accountants Act, 1949. 10. The Council thus accepted the Report of the Disciplinary Committee and decided that the Respondent was guilty of Professional Misconduct falling with the meaning of Clauses (5), (6) & (7) of Part I of the Second Schedule under Section 22 read with Sections 21 of the Chartered Accountants Act, 1949. 10. On consideration of the Report of the Disciplinary Committee along with the written representation dated 6th April 2009 and 12th April 2009 received from the Respondent, the Council decided to accept the Report of the Disciplinary Committee and accordingly held that the Respondent was guilty of Professional Misconduct falling within the meaning of Clauses (5), (6) & (7) of Part I of the Second Schedule under Section 22 read with Section 21 of the Chartered Accountants Act, 1949. 11. The Council also decided to recommend to the High Court that the name of the Respondent be removed from the Register of Members for a period of three years. 12. The Council further resolved that CA. Uttam Prakash Aggarwal, Chairman of the meeting at the time of consideration of the report be authorised to sigh the Finding of the Council in the case, on behalf of the Council.” It is in pursuance of such recommendation of the Council that the matter has been posted for hearing before us. Learned counsel for the petitioner has vehemently argued that two different Manufacturing & Trade & Profit and Loss Account for the year ending 31.3.1998 were prepared by the respondent. One of them is available at Page 146 and another at Page No. 164 of the present paper book. In both the balance sheets except the difference in the figure of purchase and sales, all other figures remain the same including the gross profit and have some kind of computer print out. Both such balance sheets were found by the Auditors of the Central Excise during the audit of the Company. Respondent was summoned by the Central Excise Authorities and has accepted the correctness thereof. In the statement recorded on 6.1.2000, the explanation given by the respondent was that the balance sheet reflecting the sale figure of Rs. 84676031.35 was compiled on the request of Management on Monthly Operating Statements. Respondent was summoned by the Central Excise Authorities and has accepted the correctness thereof. In the statement recorded on 6.1.2000, the explanation given by the respondent was that the balance sheet reflecting the sale figure of Rs. 84676031.35 was compiled on the request of Management on Monthly Operating Statements. The statement of the representative of the Management Shri Kapil Kumar was also recorded on the same date i.e. on 6.1.2000, wherein he has stated that figures in Monthly Operating Statements are estimated figures given to the Central Bank of India for availing credit facilities from the Bank while there actual sale figure is Rs. 53731031.35 as per the books of accounts of the Company. Respondent has not put in appearance before the Disciplinary Committee. It has been categorically recorded by the Disciplinary Committee that respondent has not put in appearance, though number of opportunities were granted nor he has produced any defence witnesses in support of his assertions made in the written reply. The stand of the respondent in the written reply is that both sets of balance sheets were same but only one sheet was different. The said sheet titled as “Manufacturing & Trading & Profit & Loss Account is on differently printed stationery. It was being used by the office of the Company in earlier years. This can be verified only from the style and phone numbers printed on the right hand corner of the top and even rubber stamps are different. That was the stand, reiterated even after the proceedings were concluded by the Disciplinary Committee. The respondent has not examined any defence witnesses in support of his assertion that his signatures on the balance sheets do not tally. He has admitted before the Central Excise Authorities that both sets of balance sheets are signed by him. Copy of the said statement was supplied to the respondent on the same date as is apparent from the endorsement recorded at the end of the statement. It is not even asserted by the respondent that he disputed the in-correct recording of the statement at any time by submitting any objection at any time or by submitting any protest petition to the Central Excise Department. In the absence of any oral or documentary evidence, the stand in the written statement that the signatures on the two balance sheets are not genuine, cannot be believed. In the absence of any oral or documentary evidence, the stand in the written statement that the signatures on the two balance sheets are not genuine, cannot be believed. No doubt, it appears that Page 164, containing Manufacturing & Trading & Profit and Loss Account is on a different stationery from the other pages of the balance sheets but the fact remains that the Page 164 is admitted to be signed by him before the excise authorities and not rebutted by any cogent evidence before the Council. The nature of the print out and the other figures are exactly the same as in the other balance sheet of which Manufacturing & Trading & Profit and Loss Account for the year ending 31.3.1998, which is available at Page 146 of the paper book. The plea in the defence remains unsubstantied by any evidence. Such plea cannot take place of a proof. It was for the respondent to explain as to how for the same period, two different Manufacturing & Trading & Profit and Loss Account statements came into existence duly signed by him, giving discrepant purchase and sale figures. Having failed to support his plea in any plausible manner, the disciplinary proceedings have rightly been concluded misconduct on the part of the respondent. In view of the said fact, we accept their recommendation and order removal of respondent-Shri Rajesh Chadha as the member of the institute for the period of three years.