Maintaining Integrity of the Chartered Accountant Profession: Analysis on HC judgement w.r.t Misconduct

CA Aman Rajput , Last updated: 21 November 2023  

The recent case of the Institute of Chartered Accountants of India v. Manakchand Laxman Baheti serves as a stark reminder of the importance of ethical conduct within the Chartered Accountant (CA) profession. In this case, the Bombay High Court reprimanded a CA, Manakchand Laxman Baheti, for issuing false certifications to various companies to help them avail credit facilities from banks.

The allegations against Baheti were severe. He had assisted several companies in obtaining substantial loans from various banks by issuing false documents certifying the valuation of work undertaken and completed by these companies. Additionally, he had certified sales registers and lists of supply bills without verifying the accuracy of the information, further facilitating the sanctioning of loans.

Maintaining Integrity of the Chartered Accountant Profession: Analysis on HC judgement w.r.t Misconduct

The Institute of Chartered Accountants of India (ICAI) received a complaint from one of the affected banks, prompting an investigation. The ICAI found prima facie evidence of professional misconduct and referred the case to a disciplinary committee. The committee, after thorough examination, concluded that Baheti had indeed engaged in misconduct and recommended his reprimand.

The High Court, upon reviewing the case, concurred with the committee's findings. It noted that Baheti's working papers revealed no substantial basis for the certifications he had issued. When asked to produce supporting documentation, he was unable to provide any. Moreover, he failed to provide any satisfactory explanation as to how he had satisfied himself about the existence and valuation of the assets mentioned in the certificates.


The Court emphasized that Baheti's actions constituted a serious breach of the professional standards expected of CAs. He had knowingly misled the banks, jeopardizing their financial interests and potentially causing losses. His conduct eroded the trust that the public places in CAs, who are entrusted with upholding financial integrity.

The reprimand issued to Baheti serves as a strong deterrent to any CA who might consider engaging in similar misconduct. It reinforces the message that the CA profession demands the highest ethical standards and that any deviation from these standards will not be tolerated.


As a Chartered Accountant myself, I strongly condemn Baheti's actions. His conduct was not only unethical but also detrimental to the reputation of the CA profession. It is crucial for all CAs to remain vigilant in upholding the highest ethical principles and to avoid any actions that could compromise the trust that the public places in us.

The ICAI's disciplinary process plays a vital role in safeguarding the integrity of the CA profession. By investigating and punishing instances of misconduct, the ICAI sends a clear message that ethical behavior is non-negotiable for CAs.

In conclusion, the case of Manakchand Laxman Baheti serves as a cautionary tale for all CAs. It highlights the importance of ethical conduct and the consequences of deviating from these standards. CAs must uphold their professional responsibilities with the utmost integrity to maintain the trust and respect that the profession has earned.

Published by

CA Aman Rajput
(Chartered Accountant)
Category Professional Resource   Report

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