BY: BANGALORE CORRESPONDENT
Jul 14, 2011 — BANGALORE, INDIA (SUN) — On May 23rd, 2011 the High Court of Karnataka concluded that the ISKCON Society registered in Bangalore in 1978 is a defunct entity having no legal existence, and by fabricating documents and falsifying accounts, Madhu Pandit dasa and his family members are falsely claiming the ISKCON temple at Bangalore as the property of the defunct society. The ISKCON temple at Bangalore is the property of the ISKCON society registered in Mumbai, and Madhu Pandit dasa is only the President of the Bangalore branch of ISKCON registered in Mumbai.
In further setbacks to Madhu Pandit dasa, the Institute of Chartered Accountants of India (ICAI) has independently concluded that V. L. Varadrajan, the person hired by Madhu Pandit das to prepare Account Statements in the name of the defunct Bangalore society, is “guilty of professional misconduct” . The ICAI has a Code of Conduct, through which it monitors and controls the conduct of its members.
Till the year 2000, like every other branch president of ISKCON in India, Madhu Pandit dasa, the branch President of ISKCON Bangalore, submitted annual account statements to the ISKCON head office at Juhu, Mumbai for consolidation and submission to the Income Tax authorities.
In 2001, he began to fraudulently claim that the ISKCON temple at Bangalore never belonged to ISKCON registered at Mumbai, and that it always belonged to the defunct society registered at Bangalore. However, to legally claim the Bangalore ISKCON temple in the name of the defunct society, Madhu Pandit dasa needed account statements in the name of the defunct society. And to accomplish this, Madhu Pandit dasa hired the services of auditor V. L. Varadarajan and generated fraudulent account statements in the name of the defunct society.
“In 2005, the Mumbai head office of ISKCON had complained to ICAI against Mr. V. L. Varadarajan for deceptively signing back dated Account Statements for a period of 12 years from 1989 to 2001 in one stroke.”
“Madhu Pandit Das used these fabricated Account Statements to fraudulently claim the ISKCON Temple as the property of his defunct society. In para # 69 of its judgment dated 23 May, 2011, the Hon’ble High Court of Karnataka held that the accounts of ISKCON Bangalore were manipulated by Madhu Pandit Das with the help of V. L. Varadarajan & now the ICAI has reconfirmed the same”, said Dayaram dasa, the Chairman of the Legal Committee of ISKCON.
The Disciplinary Committee of ICAI, which conducted a thorough investigation after scrutinizingly studying the case, has submitted its report and held V. L. Varadarajan guilty of professional misconduct for signing fraudulent back dated Account Statements of the defunct society.
For more information contact:
Varad Krishna das (9901060738)
President, ISKCON Jagannath Temple
ICAI Investigation Report
Following are excerpts from the proceedings of the Institute of Chartered Accountants of India regarding their investigation of V. L. Varadarajan, Madhu Pandit’s accountant. Click here to download a copy of the complete report as a PDF.
(Respondent is the accused Mr. Varadarajan.)
[This correspondent's comments are in brackets.]
“17. Therefore, the Committee is of the view of that despite providing sufficient opportunity of being heard, the Respondent had chosen not to present before the Committee without any valid ground. Therefore, considering the above, the Committee decided to proceed ahead with the matter.
[The accountant Varadarajan was too afraid to even appear before the committee and only sent a lawyer. He also stalled for as much time as possible to delay the case.]
24.2 As far as the Financial Statement for the accounting year 1990-1991 is concerned, the Committee noted that the Respondent had signed two set of financial statements for the year ending 1990-91 which appears to have been prepared from one set of Books of accounts as both the financial statements contains almost similar items and similar figures, for e.g. unsecured loan, investments, advertisement expenses, festival expenses. electricity expenses, devotee maintenance etc.
[Part of the fraud required filing taxes for the defunct society, and to do so they used ISKCON's accounts.]
24.5 However, the Committee noted that the Respondent had denied that he was auditor of ISKCON India for the financial year 1990-91. In this context, it has been noted that even in case where the Respondent was not auditor of ISKCON India, then in that case also, the question arises as to how he had signed two set of Balance Sheet as on 31st March, 1991 of ISKCON Defunct. Bangalore on different dates showing the different financial position of ISKCON Defunct. Therefore, the Respondent is guilty of professional Misconduct falling under clause (7) of Part I of Second Schedule to the Chartered Accountants Act, 1949.
24.6 With regard to the charge that all the Financial Statements from the year 1988-89 to 2000-2001 were signed by the Respondent, which were filed in one stroke in 2001, the Committee observed that Respondent carried out audit and signed the Financial Statement for the aforesaid years, which appears to have been prepared from Books of Accounts of ISKCON India Bangalore’s Branch. All the Balance Sheets from 1998-89 to 1999-2000 were filed in one stroke, and there was an order of the Income Tax Directorate Exemption, which stated that whatever had been filed was the replica of the branch account of ISKCON India.
Further, the Respondent did not submit any specific submission denying that the same were not prepared from one set of books. Therefore, he is guilty of “Other Misconduct” falling within the meaning of Section 22 read with Section 21 of the Chartered Accountants Act, 1949.
24.7 The Committee noted that that the Respondent had signed the audit report and financial statements of ISKCON Defunct for the accounting years 1991-92 to 1997-1998 on behalf of the firm, V.L.V. & Co despite the fact that that the said firm was closed on 01st June, 1992. Further, the Respondent also signed a certificate dated 25.01.2005 verifying the books of accounts and other records of ISKCON, Bangalore on behalf of the firm, M/s. V.L.V. & Associates. The said firm, M/s. V.L.V. & Associates, was closed on 22.12.2003. Therefore, it is amply clear that the Respondent deliberately signed the Audit Reports, Financial Statements and Certificate on behalf of the firm, which was not in existence at the time of signing of the Audit Reports, Financial Statement and certificate.
Therefore, the Respondent is guilty of ‘Other Misconduct’ falling within the meaning of Section 22 read with Section 21 of the Chartered Accountants Act, 1949.
CONCLUSION:-
25. In conclusion, in the considered opinion of the Committee, the Respondent is guilty of professional misconduct falling under clause (7) of Part I of Second Schedule and ‘Other Misconduct’ within the meaning of Section 22 read with Section 21 of Chartered Accountants Act, 1949.”
For original click on this link.