Chartered accountants’ apex body ICAI today said it will initiate necessary disciplinary action against member Khemchand Gandhi, who has been arrested by the CBI for allegedly leaking “secret” government documents, after receiving details from the investigative agency.

The Institute of Chartered Accountants of India (ICAI) has written to the CBI seeking relevant information about Gandhi, based on which the appropriate action will be taken.

ICAI President Manoj Fadnis said the action would be initiated against the member as per the provisions of the Chartered Accountants Act.

An official of auditing and consultancy giant PricewaterhouseCoopers (PwC) has also been questioned by the CBI in connection with this case, which involved alleged leaking confidential government documents on foreign investment policies and selling them to corporate groups.

Fadnis said that ICAI’s Director (Discipline) has written to the CBI for providing relevant details, following media reports about leakage of “official secrets and the search operation conducted by the Central Bureau of Investigation leading to the arrest of CA Khemchand Gandhi from Mumbai”.

“Based on the information/details to be received from the CBI in the matter, disciplinary action, as required, would be initiated against the concerned member in terms of the provisions of the Chartered Accountants Act, 1949 and the Rules framed thereunder,” he said in a statement.

Gandhi is among those arrested by the CBI for allegedly leaking government documents.

It has also been alleged that the PwC official was procuring documents from the Department of Economic Affairs, under the Finance Ministry, through Gandhi.

These confidential documents related to foreign direct investment policies are under consideration in the government.

The agency sources said they would probe the role of the consultancy in detail to gather corroborative evidence and decipher the official-middleman-corporate nexus in this case.

Late last night, PwC said in a statement, “Our manager met CBI officials today in connection with the FIPB applications filed by our clients and the official communication that we have exchanged with FIPB in this regard, in the normal course of business. Necessary clarification as asked for were provided.”

The CBI has arrested five persons including some government officials, Gandhi and a partner of a Mumbai-based law firm.

The probe has indicated that “first and second” levels of decision making in the Finance and Commerce Ministries relating to foreign investments were “compromised”.

When asked about PwC, ICAI President Manoj Fadnis said suo-moto action could be initiated against erring members based on information received.

“If any law enforcing agency takes action against a chartered accountant or a firm of chartered accountants, then the Disciplinary Directorate shall approach such law enforcing agency to get details and initiate suitable action in terms of the provisions of the Chartered Accountants Act, 1949 and the Rules framed there under,” Fadnis told PTI.

According to him, the agency or department can file a formal complaint with the institute.

“However, based on inputs or documents receivable, suo-moto action can also be initiated against the erring member by treating it as information in terms of the provisions of Section 21 of the Chartered Accountants Act, 1949,” Fadnis noted. ICAI (PTI - Business Standard)