A clear-cut understanding about the extent of specific applicability of Rule 55 of the Income Tax Rules, 1962:
The Rule 55 of the Income Tax Rules, 1962 read as ‘If the Chief Commissioner or Commissioner is satisfied that the applicant fulfills the requirements of Clause (v) or Clause (vi) [or Clause (via)] or Clause (vii) of sub-section (2) of section 288 and has been practicing before income tax authorities for not less than one year on the date of application, the Chief Commissioner or Commissioner shall enter the name of the applicant in the register and issue him a certificate of registration in Form No: 40‘.
Arriving at a clear-cut decision about the extent of Specific Applicability of the additional norm of “and has been practicing before income tax authorities for not less than one year on the date of application” lay under the Rule 55 of the Income Tax Rules, 1962, as far as Clauses (v) and (vi) of the Income Tax Act, 1961 are concerned, could only be possible with proper application of mind only.
In fact, the prerequisite/condition/norm “and has been practicing before income tax authorities for not less than one year on the date of application” is not applicable to Clauses (v) and (vi) of Section 288(2) of the Income Tax Act, 1961. No doubt, this prerequisite/condition/norm is applicable to Clauses (via) and (vii) of Section 288(2) of the Income Tax Act, 1961 only. This could be understood easily by properly perusing the Form No: 39 itself. One could find that the Form No: 39 is meant only for those aspirants coming under the categories of the Clauses (v), (vi) and (vii) of Section 288(2) of the Income Tax Act, 1961. Because, the Form No: 39 has been prescribed prior to amendments made to Section 288(2) and Rule 55 of the Income Tax Law. Therefore, we need to arrive at the probable original statute of the Rule 55 that be real prior to amendments made to Section 288(2) and Rule 55 of the Income Tax Law.
The Clause (via) was inserted in Subsection (2) of Section 288 of the Income Tax Act, 1961 by the Taxation Laws (Extension to Union Territories) Regulation, 1963, but that Clause (via) was inserted in Rule 55 of the Income Tax Rules, 1962 by the IT (Fourth Amendment) Rules, 1979. Thus, we need to put aside the Clause (via) to arrive at the probable original statute of the Rule 55 that be real prior to amendments made in Rule 55 of the Income Tax Law. The original statute of Rule 55 might be read as follows:
| The Rule 55 of the Income Tax Rules, 1962:
“If the Chief Commissioner or Commissioner is satisfied that the applicant fulfills the requirements of – Clause (v) of Subsection (2) of Section 288 of the Income Tax Act, 1961 or Clause (vi) of Subsection (2) of Section 288 of the Income Tax Act, 1961 or Clause (vii) of Subsection (2) of Section 288 of the Income Tax Act, 1961 and has been practicing before income tax authorities for not less than one year on the date of application, the Chief Commissioner or Commissioner shall enter the name of the applicant in the register and issue him a certificate of registration in Form No: 40”. |
If we re-arrange the Rule 55 in a moderate form the same would look as follows:
|
Rule 55: “If the Chief Commissioner or Commissioner is satisfied that the applicant fulfills the requirements of – Clause (v) or Clause (vi) or Clause (vii) of Subsection (2) of Section 288 of the Income Tax Act, 1961 and has been practicing before income tax authorities for not less than one year on the date of application, the Chief Commissioner or Commissioner shall enter the name of the applicant in the register and issue him a certificate of registration in Form No: 40”. |
From the above statute of the Rule 55 of the Income Tax Rules, 1962, it is quite evident that the prerequisite/condition/norm that read as “and has been practicing before income tax authorities for not less than one year on the date of application” is applicable to Clause (vii) only, which matches appropriately with respective position in Form No: 39.
Further, since imposing by RULES, other than those prescribed in ACT is ultra-virus, the following shall enable a clear-cut understanding about the appropriate applicability of the prerequisite/condition/norm that read as “and has been practicing before income tax authorities for not less than one year on the date of application”:
| Clause of Section 288(2) | Criterion about Eligibility | Extent applicable in Rule 55 |
| Clause (v) |
Any person who has any accountancy examination recognized in this behalf by the Board |
As per Clause (v) of Subsection (2) of Section 288 of IT Act. |
| Clause (vi) |
Any person who has acquired such educational qualification as the Board may prescribe for this purpose |
As per Clause (vi) of Subsection (2) of Section 288 of IT Act. |
| Clause (vii) |
Any other person who, immediately before commencement of this Act, was an income tax practitioner within the meaning of clause (iv) of the Indian Income Tax Act, 1922, and was actually practicing as such |
As per Clause (vii) of Subsection (2) of Section 288 of IT Act and has been practicing before income tax authorities for not less than one year on the date of application |
To justify & defend the above views, we need to consider & approve the contents of the Para-9 of the Judgment of the Hon’ble ITAT, Agra Bence in the case of Samagra Vikas Mahila Samiti Vs CIT (vide ITA No. 133/Agra/2013 dated 09-07-2013) in which it is clearly stated as “ … The person who claims to be registered as ITP shall have to file proper application supported by documents to prove his accountancy examination recognized and educational qualifications achieved by him as per Rules. When CCIT or the CIT are satisfied that such person fulfills the requirement of section 288(2) of the Act, the ITP would be registered with the CCIT/CIT and a certificate of registration to practice shall be granted in his favour”.
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Author: SYED SHAH KHADRI, B.B.A., LL.B., | Tax Practitioner & Proprietor | SYED ZULFAKHAR CONSULTANCY SERVICES
Sir,
In Para 4 of the same Judgment of the Hon’ble ITAT, Agra Bench in the case of Samagra Vikas Mahila Samiti Vs CIT (vide ITA No. 133/Agra/2013 dated 09-07-2013) is conveying as “ ….. ITP, there should be registration and certificate issued by the concerned CIT/CCIT, otherwise …., ITP has no right to practice before the Income-tax Authorities or before the Tribunal”. This statement is also standing in opposition to the condition of “prior practice for not less than one year” in Rule-55 of the Income Tax Rules.