An Advocate Cannot Be Criminally Liable For Negligence In Performing Professional Services: Chhattisgarh HC [Read Judgment]

"It is true that the petitioner could have exhibited more and greater professional care and competence, yet in failure to exercise the same, she could not have been held criminally liable," Justice Sanjay K. Agrawal held.

In the facts of the case, the Petitioner-Advocate, Subha Jakkanwar, was charged under Sections 420, 467, 468, 471 & 120B of IPC for allegedly wrongly providing provided non-encumbrance certificate on properties of 10 borrowers who had applied for a loan with Dena Bank. On their failure to repay the loan, it was discovered that the documents submitted by the borrowers were false and fabricated. Consequently, an FIR was registered against them. Subsequently however, the Petitioner was also roped in as an accused for alleging that she had given non-encumbrance certificate of legal scrutiny and she had certified documents concerned and, thereby, she had also committed the offence.

The court quashed the said FIR against the Petitioner, stating that merely because her opinion was not acceptable, she could not be mulcted with criminal prosecution, particularly, in the absence of tangible evidence that she associated with other conspirators. At the most, she may be liable for gross negligence or professional misconduct if it is established by acceptable evidence, the court said.

Reliance was placed on Central Bureau of Investigation, Hyderabad v. K. Narayana Rao, (2012) 9 SCC 512, to hold,

"It is well settled law that extending of a legal opinion for granting loan has become an integral component of an advocate's work in banking sector. A lawyer, on his part, has a responsibility to act to the best of his knowledge and skills and to exhibit an unending loyalty to the interest of his clients. He has to exercise his knowledge in a manner that would advance the interest of his clients. However, while acting so the advocate does not assure to his client that the opinion so rendered by him is flawless and must in all possibility act to his gains. Just like in any other profession, the only assurance which can be given and may even be implied from an advocate so acting in his professional capacity is that he possesses the requisite skills in his field of practice and while undertaking the performance of task entrusted to him, he would exercise his skills with reasonable competence. The only liability that may be imputed on an advocate while so acting in his professional capacity is that of negligence in application of legal skills or due exercise of such skills."

In Pandurang Dattatraya Khandekar v. Bar Council of Maharashtra, 1984 SCR (1) 414, the Supreme Court had held

"There is a world of difference between the giving of improper legal advice and the giving of wrong legal advice. Mere negligence unaccompanied by any moral delinquency on the part of a legal practitioner in the exercise of his profession does not amount to professional misconduct."

In this light it was held that liability against an opining advocate arises only when the lawyer was an active participant in a plan to defraud the Bank. Since in the present case no evidence was produced suggesting that the petitioner conspired with the other co-­accused persons to submit false report or derived any pecuniary advantage to submit the non-­encumbrance certificate, she was absolved of all the charges and proceedings were quashed.

The Petitioner was represented by Advocate Ashish Shrivastava and the Respondent State by Deputy Advocate General HS Ahluwalia.

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