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CA Cannot Be Prosecuted for ingenuine documents submitted by clients for Form 15CB under PMLA: Madras High Court
The Madras High Court in the present case of Murali Krishna Chakrala vs Deputy Director (Criminal Revision Case No.1354 of 2022 and Crl. M.P.No.14792 of 2022) has held that the chartered accountant (CA) has no obligation to address the veracity or inaccuracy of documents submitted by clients.
The complainant or petitioner, Murali Krishna Chakra, is a chartered accountant accused under the Anti-Money Laundering Act of 2002 (PMLA). A client asked the Complainant to issue Form 15CB. The customer had to pay for imports. After verifying all the required information, the petitioner completed the 15CB form as requested by the client. The Bureau of Enforcement has investigated five persons. The allegation is that people have opened fictitious bank accounts, submitted fake tickets, kept huge sums of money in these bank accounts, and transferred them through banks to various parties abroad to make legal transactions for import purposes.
An initial investigation found that 8 crores were transferred from India through seven banks to a fictitious entity abroad. However, the Bureau of Enforcement continued to investigate the case despite the complaint being filed. During the investigation, the Bureau of Enforcement found Form 15CB issued by the competent authority or CA. They took notice of him, and during interrogation, he revealed a shocking fact that Kiyam Mohammed, one of his clients had approached him for Form 15CB issuance under Rule 37-BB of the Income Tax Rules, 1962, and submitted supporting documents. . The competent authority has reviewed these documents and issued a certificate that Forms 15CB is not required to be issued for import payments.
The petitioner argued that Form 15CB for making overseas or foreign payments for imports is also not needed by law and that all other state-owned banks, except Travancore Provincial Bank, have filed import documents without claiming one form from the CA. If Murari Krishna Chakrala had been involved in the conspiracy, he would not have been tricked into uploading the certificate to the Income Tax Administration Portal on the same day.
The petitioner argued that the mere issuance of five Form 15CB numbers by him at a customer's request would not put CA in the net of a money laundering conspiracy and merit acceptance. The CA had only received Rs.1,000 for no more certificates. The court released the plaintiff from prosecution and admitted him as a witness.
Refer to the following case order for more details- Murali Krishna Chakrala vs Deputy Director
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