Vijender Sharma v. Union of India & Anr.

1. This hearing has been done through hybrid mode.

2. The Petitioner - Mr. Vijender Sharma who is currently the President of the Respondent No.2 - Institute of Cost Accountants of India has filed the present writ petition seeking extension of his term for the full period of one year till 23rd November, 2023 as per Section 12(3) of the Cost and Works Accountants Act, 1959 (hereinafter, “Cost Accountants Act”).

3. The brief background is that the Respondent No.2 is constituted under the Cost Accountants Act. The Council under the said Act is defined in Section 2 and as per Section 9 it is in charge of the day to day management of the affairs and discharge of functions under the Cost Accountants Act. The composition of the Council is of not more than 15 persons who are elected from amongst the fellows of the Respondent No.2 institute. The election is governed by Section 10 of the Cost Accountants Act and the duration of the Council is prescribed under Section 14. The Council elects the President and Vice-President as per Section 12 of the Act and as per Section 12(3), the President or the Vice-President is to hold office for a period of one year from the date on which she/he is elected. Section 12 and 14 of the Cost Accountants Act are as under:

12. President and Vice-President (1) The Council at its first meeting shall elect two of its members to be respectively the President and the Vice-President thereof, and so often as the office of the President or the Vice President becomes vacant, the Council shall choose a person to be the President or the Vice President, as the case may be: Provided that on the first constitution of the Council a member of the Council nominated in this behalf by the Central Government shall discharge the functions of the President, until such time as a President is elected under the provisions of this sub-section. (2) The President shall be the 1[Head] of the Council. (3) The President or the Vice-President shall hold office for a period of one year from the date on which he is chosen but so as not to extend beyond his term of office as a member of the Council, and, subject to his being a member of the Council at the relevant time, he shall be eligible for re-election 2[under sub-section (1)]: Provided that the President 2[and the Vice-President] of the Council at the time of the expiration of its duration shall continue to hold office until a new Council is constituted in accordance with the provisions of this Act.

14. Duration and dissolution of Council (1) The duration of any Council constituted under this Act shall be 4[four] years from the date of its first meeting. (2) Notwithstanding the expiration of the duration of a Council (hereinafter referred to as the former Council), the former Council shall continue to exercise its functions under this Act until a new Council is constituted in accordance with the provisions of this Act, and on such constitution, the former Council shall stand dissolved.

4. The grievance of the Petitioner is that every year, the Council elects the President and Vice-President. In 2020, the Council decided that the term of the President and Vice President which was due to expire on 21th July, 2020 may be extended upto 21st October, 2020 due to the spread of COVID-19. However, this Court vide order dated 17th September, 2021 in WP(C) 10403/2021 titled The Institute of Cost Accountants Of India v. Appellate Authority, Institute of Cost Accountants of India and Ors. directed to postpone the proposed election. The said order was finally vacated on 17th November, 2021.

5. Thus, in the year 2021 instead of the President taking charge in July he took charge only in November, 2021. In view of the same, the present president i.e. the Petitioner took charge in November, 2022.

6. The case of the Petitioner is that the elections have been called by the Respondent No.2 in March, 2023 and the new Council is to take over with effect from 21st July, 2023. If the new Council takes over in July, the Petitioner’s term as President would be curtailed by approximately three months. Thus, it is the submission that the Petitioner should be permitted to serve for the entire tenure i.e. for a period of one year in terms of Section 12(3) of the Cost Accountants Act. Moreover, the anxiety expressed by the Petitioner is that the code of conduct would also come into effect from March, 2023. In effect therefore, the functioning of the President would be severely curbed and curtailed.

7. On behalf of the Respondents, it is submitted that the last Council was constituted and took charge on 22nd July, 2019 and in terms of Section 14(1), the duration of the Council shall be four years. The new Council would have to be elected which would take charge and get constituted with effect from 21st July, 2023. The President has to be within the Council and once the new Council takes charge on 21st July, 2023, the current President can no longer continue and a new President would have to be elected from the newly constituted Council. It is thus submitted that the prayer in the writ cannot be allowed.

8. Heard. A perusal of Section 12(3) of the Cost Accountants Act shows that under usual circumstances, the President has to hold office for a period of one year. However, the President functions within the Council and is elected from within the Council. Further under Section 12(3), the tenure of the President has to end with the tenure in the Council and not beyond that. For whatever reasons including the litigation which may have taken place in 2021, the present Petitioner’s tenure is being unfortunately curtailed. Though, he was not involved in the litigation in 2021, when he took over as the President in November, 2022, in the opinion of the Court, he was well aware that there was a serious possibility of his tenure being curtailed. Moreover, the Council did send the recommendation to the Ministry of Corporate Affairs (MCA), Union of India seeking extension of the tenure of the Petitioner way back on 14th January, 2022. However, the same was not acceded to by the MCA.

9. Thus, in the overall facts and circumstances, this Court is of the opinion that the election of the Council having been called and the new Council being mandated to take charge with effect from 21st July, 2023, the tenure of the President cannot be extended till November, 2023 as is being sought by the Petitioner. The scheme of the Act would be completely disturbed if such extensions are granted and interference is made by the Court in extraordinary writ jurisdiction.

10. Thus, this is not a case for exercise of such discretion under Article 226/227 of the Constitution.

11. The petition is accordingly dismissed. All pending application are also disposed of. It is clarified that none of the issues if any raised, have been gone into by this Court.

PRATHIBA M. SINGH JUDGE MARCH 2, 2023 Rahul/KT