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PROF ETHICS FILE

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INDEX
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ACKNOWLEDGEMENT
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BAR COUNCIL OF ANDHRA PRADESH

VS.
KURAPATI SATYANARAYAN

I. INTRODUCTION:

The case of Bar Council of Andhra Pradesh vs Kurapati Satyanarayana highlights the
seriousness with which professional misconduct, particularly misappropriation of client
funds, is viewed within the legal profession. The Supreme Court’s decision reinforces the
principle that advocates must uphold the highest standards of integrity and trust in their
professional conduct.
The judgement serves as a reminder that negligence and misuse of client funds, even under
extenuating personal circumstances, are unacceptable and warrant strict disciplinary action to
maintain the sanctity and trust reposed in the legal profession.

II. FACTS OF THE CASE:

 The Bar Council of Andhra Pradesh filed an appeal against the order of the Disciplinary
Committee of the Bar Council of India, dated March 28, 1999. The Bar Council of India
had set aside the State Bar Council’s order, which had removed Kurapati Satyanarayana
from its role after he was found guilty of grave professional misconduct in the discharge
of his duties.
 Initially, Shri Gutta Nagabhushanam filed O.S. No. 1624 of 1991 with the Additional
District Munsif Magistrate. The suit was decreed, leading to the institution of Execution
Petition No. 112 of 1995 for the realisation of the decretal amount. Kurapati
Satyanarayana was engaged as counsel by Shri Gutta Nagabhushanam in the execution
proceedings.
 Kurapati Satyanarayana received a total sum of Rs. 14,600/- on various dates during the
execution proceedings but did not remit the amount to Shri Gutta Nagabhushanam. On
October 18, 1996, Shri Gutta Nagabhushanam filed a complaint with the Additional
District Munsif, who then transferred the matter to the Bar Council of Andhra Pradesh.
 The complaint and important documents were forwarded to the State Bar Council, but
Kurapati Satyanarayana chose not to file a counter. Consequently, the matter proceeded to
the Disciplinary Committee, which examined witnesses and concluded that Kurapati
Satyanarayana had retained Rs. 14,600/- belonging to Shri Gutta Nagabhushanam, thus
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committing professional misconduct. He was directed to return the money to the

complainant.
 Kurapati Satyanarayana asserted that he informed Shri Gutta Nagabhushanam about
receiving the decretal amount through a postcard and that he had paid Rs. 11,000/- on
April 24, 1996. However, the Disciplinary Committee did not accept this assertion as he
failed to produce evidence of the payment.
 Kurapati Satyanarayana then appealed to the Disciplinary Committee of the Bar Council
of India. While the Committee agreed with the State Bar Council’s finding that Kurapati
Satyanarayana failed to pay Rs. 14,600/-, it concluded that he did not commit professional
misconduct, though he may have been negligent.
 The Bar Council of India noted that Kurapati Satyanarayana never refused to return the
money and had made partial payments. The remaining amount was reportedly used for his
treatment, indicating no intent to misappropriate the funds. Consequently, the Bar Council
of India set aside the State Bar Council’s order, holding that the delinquent had not
committed professional misconduct, but may have been negligent, which did not involve
moral turpitude.
 The Bar Council of Andhra Pradesh appealed against this decision.

III. ISSUES INVOLVED:

1. Whether retaining a client’s money by an advocate amount to professional

misconduct?

2. Whether, in this case, retaining the client’s money is merely negligence on the
part of Kurapati Satyanarayana?

3. Whether Kurapati Satyanarayana is guilty of professional misconduct?

4. Whether the Disciplinary Committee of the Bar Council of India erred in its
judgment?

5. Whether the Disciplinary Committee can modify an earlier order by taking a

different view of the same facts in the exercise of its review power?
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IV. ARGUMENTS OF THE PARTIES:

Appellant (Bar Council of Andhra Pradesh)

The appellant in Bar Council of Andhra Pradesh vs Kurapati Satyanarayana argued that the
Bar Council of India’s decision to set aside its order of removing Kurapati Satyanarayana
from the State roll was erroneous.
They contended that retaining a client’s money constituted one of the gravest forms of
professional misconduct. They emphasised the importance of maintaining the integrity of the
legal profession and argued that the State Bar Council’s original decision was justified given
the facts of the case.

Respondent (Kurapati Satyanarayana)

The respondent in Bar Council of Andhra Pradesh vs Kurapati Satyanarayana argued that the
appeal filed by the Bar Council of Andhra Pradesh was not maintainable, as it was not the
aggrieved party. They contended that the appeal should be dismissed on these grounds.
Furthermore, they asserted that the Disciplinary Committee of the Bar Council of India had
correctly assessed the situation and found that while there may have been negligence, there
was no professional misconduct.

V. LEGAL ASPECTS INVOLVED IN THE CASE:

The Advocates Act, 1961:

Section 38: Allows any person aggrieved by an order made by the disciplinary committee of
the Bar Council of India to appeal to the Supreme Court within sixty days. The Supreme
Court may pass orders, including varying the punishment awarded.

Bar Council of India Rules:

Part-VI, Chapter-II: Provides standards of professional conduct and etiquette for advocates.
Rule 24: An advocate shall not abuse or take advantage of the confidence reposed in him by
his client.
Rule 25: An advocate should keep accounts of the client’s money entrusted to him.
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Prevention of Corruption Act, 1988:

Misappropriation of money by a public servant is punishable under this act with
imprisonment of not less than one year.

VI. JUDGEMENT:

 The Supreme Court in Bar Council of Andhra Pradesh v. Kurapati Satyanarayana found
the order of the Disciplinary Committee of the Bar Council of India unsustainable. It
criticised the Committee for trivialising a grave instance of professional misconduct by
suggesting that the advocate used the client’s money for personal treatment due to family
circumstances. The Supreme Court held that the finding that there was no intention to
misappropriate the money was unfounded and perverse, lacking the serious consideration
required in such matters.
 The Supreme Court in Bar Council of Andhra Pradesh versus Kurapati Satyanarayana
emphasised that there was no evidence or plea indicating that Kurapati Satyanarayana
was in dire financial difficulty necessitating the use of the client’s money for personal
treatment. The Court held that such excuses were frivolous and unsustainable. It
referenced the case of Harish Chandra Tiwari Baiju, highlighting that misappropriation of
a client’s money is one of the gravest forms of misconduct for a legal practitioner.
 The Court in Bar Council of Andhra Pradesh v Kurapati Satyanarayana noted that if a
public servant misappropriates money, they face punishment under the Prevention of
Corruption Act and certain dismissal from service. There is no justification for treating
advocates differently in such cases. The gravity of the breach of trust is not mitigated by
temporary misappropriation or subsequent restitution.
 Regarding the respondent’s argument that the appeal was not maintainable, the Court
cited the Bar Council of Maharashtra M. V. Dabholkar case, which held that the Bar
Council has a dual role: as a prosecutor through its Executive Committee and a quasi-
judicial role through its Disciplinary Committee. Thus, the appeal was maintainable.
 The Supreme Court in Bar Council of Andhra Pradesh vs Kurapati Satyanarayana set
aside the Bar Council of India’s order, restoring the State Bar Council’s decision to
remove Kurapati Satyanarayana’s name from its roll.
 The Court found the conduct of the delinquent advocate reprehensible and unbecoming of
an advocate, noting that it was particularly disappointing given his long practice and
previous service as a Government advocate. The Supreme Court upheld the decision of
the Andhra Pradesh Bar Council and awarded costs of Rs. 5,000/- to the appellant.
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BIBLIOGRAPHY