SC seeks reply from corporate affairs ministry in GTB case

Written by Indu Bhan | Indu Bhan | New Delhi | Updated: Aug 3 2012, 08:49am hrs
The Supreme Court has sought reply from the corporate affairs ministry and others on a petition filed by auditor P Ramakrishna challenging the decision of the disciplinary committee of the Institute of Chartered Accountants of India to bar the auditor from practising accountancy for five years.

Ramakrishna, who is a Partner in Lovelock & Lewes, a network affiliate of Price Waterhouse, was found guilty of professional misconduct as auditor for the troubled GTB during 2000-01. That was when the 1993-formed bank was on the verge of collapse due to reckless lending.

However, ICAIs council has not yet approved the panels decision.

A bench headed by Justice RM Lodha while seeking reply from ICAI, its disciplinary committee and others directed the institute not to pass any final order against Ramakrishna until further orders.

Additional Solicitor General Mohan Parasaran, appearing for the ministry, sought some time to enable the ministry to file counter-affidavit. The next date of hearing is on August 28.

Ramakrishna has challenged the decision of the Delhi High Court that upheld the disciplinary committees order of 2010 to blacklist Ramakrishna.

Ramakrishna was associated with Lovelock & Lewes, a network-affiliate of PricewaterhouseCoopers, when he audited accounts of GTB. The banks networth was wiped off due to accumulated losses to the tune of R265 crore as of March, 2003. As per the audit report, the bank had understated its NPAs. As the management failed to infuse capital in GTB, the RBI placed a moratorium on the banks operations in 2004 to protect the depositors interest. However, EBI announced the merger of GTB with Delhi-based public sector lender Oriental Bank of Commerce.