Unauthorized Representation before GST Authorities: A Critical Analysis in Light of Chandrasekaran v. Assistant Commissioner (ST), W.P. No. 30638 of 2025 (Madras High Court)
Abstract
The Goods and Services Tax (GST) regime was envisaged as a unified, transparent, and professionally regulated system of indirect taxation in India. However, the increasing participation of unauthorized accountants and clerical staff before GST authorities has undermined the statutory framework, resulted in defective compliance, and eroded institutional integrity. The recent decision of the Hon’ble Madras High Court in Chandrasekaran v. Assistant Commissioner (ST), Kodumudi Assessment Circle crystallizes the legislative intent that only qualified professionals may represent taxpayers. This article examines the statutory framework, the judicial mandate, practical consequences of unauthorized representation, prevailing misconceptions among taxpayers, and proposes reforms to reinforce statutory compliance.
I. Introduction
Representation before tax authorities is not a mere procedural formality; it is central to ensuring justice within a quasi-judicial framework. The Central Goods and Services Tax Act, 2017 (hereinafter “CGST Act”)¹, read with corresponding State enactments, establishes a closed list of professionals entitled to represent taxpayers before GST authorities. Despite this, administrative laxity has permitted unauthorized accountants and clerical intermediaries to act as de facto representatives. The Hon’ble Madras High Court in *Chandrasekaran v. Assistant Commissioner (ST)*² emphasized that such representation is illegal and fraught with risk, thereby underscoring the urgent need for administrative and judicial enforcement.
II. Statutory Framework: Section 116 of the CGST Act
Section 116 of the CGST Act³ explicitly enumerates the categories of persons entitled to appear before quasi-judicial GST authorities:
1. Advocates enrolled under the Advocates Act, 1961;⁴
2. Chartered Accountants, Cost Accountants, and Company Secretaries, within their respective professional mandates; and
3. GST Practitioners duly enrolled under the Act.⁵
The deliberate exclusion of the generic term “accountant” reflects legislative intent. Unlike Chartered Accountants, Cost Accountants, or Company Secretaries, unregulated accountants lack statutory oversight, professional accountability, and ethical obligations. Allowing such persons to act as representatives would contravene the statutory mandate and diminish the professional rigor intended by the legislature.
III. Judicial Mandate: Chandrasekaran v. Assistant Commissioner (ST)
In Chandrasekaran, W.P. No. 30638 of 2025 (Madras HC, Aug. 19, 2025), the Court confronted the adverse consequences of representation by unqualified intermediaries. The Court observed:
- “Due to the ill advice of the consultant, the petitioner has filed an irrelevant reply.”
- “Such kind of ill-advice leads to the fact that the clients are not in a position to appear before the officers concerned with suitable reply supported by documents.”
- “This Court feels that this type of wrong advice given by an unqualified person cannot be accepted.”⁶
The Court directed the GST Department to issue circulars cautioning taxpayers against engaging unqualified consultants. This judgment affirms that unauthorized representation is not merely irregular but impermissible and contrary to the rule of law.
IV. Practical Consequences of Unauthorized Representation
1. Erroneous Availment of Input Tax Credit
Unqualified accountants often misinterpret eligibility requirements under Sections 16 and 17 of the CGST Act, leading to wrongful claims.⁷ Such errors expose taxpayers to penalties under Sections 73 and 74, as well as interest liability.
2. Inability to Keep Pace with Frequent Amendments
The GST regime is dynamic, characterized by frequent notifications, circulars, and amendments issued by the GST Council and CBIC. Unauthorized intermediaries are unable to track these changes systematically, resulting in compliance that is outdated or defective.
3. Facilitation of Corruption
Lacking professional accountability, unauthorized accountants are vulnerable to coercion or inducements from departmental officials, creating channels for corruption. This undermines the credibility of the GST system and reduces taxpayer confidence.
4. Degraded Standards of Advocacy
Low-cost representation by unauthorized persons often produces substandard pleadings devoid of legal reasoning or supporting evidence. This not only weakens taxpayer defense but also increases administrative and judicial burdens due to avoidable appeals.
5. Breach of Client Confidentiality
Qualified professionals operate under statutory codes of ethics (e.g., Bar Council of India Rules, ICAI Code of Ethics). Unqualified accountants, by contrast, are not bound by enforceable confidentiality standards, exposing sensitive financial information to misuse.
6. Increased Risk of Prosecution
Erroneous or misfiled returns prepared by unauthorized persons may trigger criminal liability under Chapter XIX of the CGST Act. While taxpayers bear the legal consequences, the unauthorized representatives evade accountability.
7. Erosion of Judicial Time
Substandard representations generate unnecessary litigation, occupying appellate forums and judicial resources with cases arising from preventable errors rather than genuine interpretative disputes.
8. Distortion of Professional Ecosystem
The presence of unqualified persons undermines the professional market for Advocates, Chartered Accountants, and GST Practitioners, creating a race to the bottom in fees and quality.
9. Taxpayer Complacency and Misplaced Trust
Taxpayers often assume that low-cost intermediaries or automated accounting software (e.g., Tally, Marg) suffice for compliance. This reliance fosters complacency, undermining respect for statutory obligations and the integrity of quasi-judicial proceedings.
10. Misconceptions Among Taxpayers
A prevalent misconception is that accounting software or low-cost intermediaries can substitute for professional representation. This is flawed because:
1. Software cannot interpret legal provisions such as ITC eligibility, exemptions, or classification of supplies.
2. Reliance on unauthorized accountants encourages bribery, as these persons are considered “soft targets.”
3. Delegation to unqualified hands erodes respect for law and weakens the integrity of quasi-judicial forums.
VI. Reform Imperatives
1. Mandatory Disclosure of Professional Credentials
Online submissions must require representatives to disclose their credentials, including Advocate enrollment number, ICAI/ICSI/ICMAI membership, or GST Practitioner ID.
2. Taxpayer Responsibility Disclaimers
When taxpayers file directly, the portal should include a disclaimer clarifying that ignorance of law or reliance on unauthorized persons will not excuse liability.
3. Prohibition of Unauthorized Appearances
GST officers must be directed not to entertain unauthorized accountants, thereby ensuring departmental compliance with statutory mandates.
4. Public Awareness Campaign
Circulars, SMS alerts, and emails should be used to educate taxpayers that only qualified professionals—Advocates, Chartered Accountants, Cost Accountants, Company Secretaries, and GST Practitioners—may lawfully represent them.
VII. Conclusion
The GST framework was designed to operate as a professionally regulated tax regime. Unauthorized intermediaries, however, compromise compliance quality, erode institutional integrity, and create significant risk for taxpayers. The Chandrasekaran judgment underscores the judiciary’s intolerance toward such practices. Decisive administrative action—mandatory credential verification, prohibition of unauthorized appearances, and public awareness initiatives—is essential to restore compliance standards, protect taxpayers, and reinforce the rule of law within the GST system.
References
1. Central Goods and Services Tax Act, No. 12 of 2017, § 116.
2. Chandrasekaran v. Assistant Commissioner (ST), Kodumudi Assessment Circle, W.P. No. 30638 of 2025 (Madras HC Aug. 19, 2025).
3. Id.
4. Advocates Act, No. 25 of 1961, § 30.
5. CGST Act, § 116(2).
6. Chandrasekaran, supra note 2.
7. Sections 16 & 17, CGST Act, 2017 (Eligibility and computation of Input Tax Credit).
8. GST Council, Notifications & Circulars (2017–2025), available at https://gstcouncil.gov.in.
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