The Institute of Chartered Accountants of India (ICAI) has reprimanded a Chartered Accountant for failing to exercise due diligence while certifying Form AOC-4 filed with the Ministry of Corporate Affairs (MCA).
The order was passed by the Disciplinary Committee (Bench-IV) under Section 21B(3) of the Chartered Accountants Act, 1949, in the matter titled Shri Vijaya Simha Reddy, Deputy Registrar of Companies vs. CA. Rakesh Kant Khandelwal.
Background of the Case
The complaint was filed by the Deputy Registrar of Companies, New Delhi, under the Ministry of Corporate Affairs, following an inspection into the affairs of M/s. Unik Springs India Private Limited.
It was alleged that for the financial years 2014-15 and 2015-16, the Audit Report and Balance Sheet attached with Form AOC-4 did not bear the original signatures of the auditor and the company’s directors. Instead, the documents reflected only "SD/-" (signed copy) markings.
Despite this, the e-Form AOC-4 was certified by the auditor, confirming that the attachments were complete, correct, and duly signed as per statutory requirements.
Key Legal Provisions Examined
The Committee examined compliance with:
- Section 134(1) of the Companies Act, 2013, which mandates that financial statements must be duly signed by authorized directors before submission.
- Rule 8 of the Companies (Registration Offices and Fees) Rules, 2014, which requires that scanned documents attached to e-forms must be copies of originally signed documents.
The certification clause in Form AOC-4 explicitly holds the certifying professional responsible for verifying that attachments are properly signed and compliant with the law.
Auditor's Defence
The Respondent contended that:
- There was no explicit statutory instruction requiring verification of original signatures in the uploaded copy.
- The defect in filing Form AOC-4 was curable and did not amount to professional misconduct.
- The omission was an oversight and occurred due to reliance on MCA’s instruction kit.
However, during the hearing, the auditor admitted that the documents were filed without affixing original signatures.
Disciplinary Committee's Findings
The ICAI Disciplinary Committee held that:
- The requirement to upload duly signed documents is statutory and mandatory.
- A certifying professional is responsible for ensuring compliance with applicable legal provisions.
- The plea that the instruction kit did not specifically mandate signature verification is not a valid defence.
- The auditor failed to exercise due diligence in certifying the form and attachments.
Accordingly, the Committee found the member guilty of Professional Misconduct under Clause (7) of Part I of the Second Schedule to the Chartered Accountants Act, 1949, which pertains to failure to exercise due diligence or gross negligence in professional duties.
Punishment: Reprimand Ordered
Taking into account the facts and circumstances of the case, the Committee ordered that CA. Rakesh Kant Khandelwal (M.No. 072653), Faridabad, be reprimanded under Section 21B(3)(a) of the Chartered Accountants Act, 1949.
The order underscores the importance of strict compliance in e-filings and reiterates that certification responsibilities extend to verifying the authenticity and completeness of attached documents.
Click here to check the official copy of the order
Compliance Takeaway for Professionals
This ruling serves as a reminder to Chartered Accountants that:
- Certification of MCA forms carries statutory responsibility.
- Due diligence includes verifying that scanned attachments bear actual signatures.
- Procedural lapses in electronic filings can attract disciplinary action.
The decision reinforces ICAI's stance on maintaining professional standards and accountability in corporate compliance filings.
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