ICAI expresses its concern on the proposed definition of “Accountant” in DTC, 2013 – (17-04-2014)

As the members are aware, the Direct Taxes Code, 2013 has proposed to widen the scope of the definition “Accountant” to include other professionals as well. It is a fact that various provisions in the Income-tax Act, 1961 under which chartered accountants have been given the responsibilities to undertake audit and certification of accounts of various entities have the emphasis on “audit” of the relevant accounts which is the exclusive domain of Chartered Accountants.

The Council of ICAI is aware that the proposed change is a cause of major concern to the entire profession. In this regard, ICAI has through a representation to Ministry of Finance, placed on record its concern not only for the profession, but for the country as a whole since issuance of audit certificates by persons having limited knowledge of audit of accounts will not only be professionally incorrect and but will raise many concerns including causing huge revenue leakages.

A meeting in this regard was held with Mr. Rajiv Takru, Revenue Secretary and Mr. R.K.Tewari, Chairman, CBDT on 16.4.2014, wherein CA. K. Raghu, President, ICAI and CA. Manoj Fadnis, Vice President, ICAI emphasized on the fact that there is a very significant difference in the area of expertise of other professionals vis-a-vis Chartered Accountants.

Members be assured that the Council of ICAI is equally concerned and will not leave any stone unturned to save the profession and the nation.

Secretary, Direct Taxes Committee

Also Read –

More Under Income Tax

Posted Under

Category : Income Tax (27864)
Type : Featured (4025) News (13806)
Tags : Direct Tax Code (296) dtc (262) ICAI (2670)

0 responses to “ICAI expresses concern on proposed definition of “Accountant” in DTC”

  1. B.S.K.RAO says:

    AUDIT IN COMPANIES ACT IS A COST, FINANCIAL & MANAGEMENT ACCOUNTS AUDIT. HERE ONLY CMAS BE ALLOWED TO FURNISH THE SAME (ANNUAL REPORT PRESUMED TO BE UNDERSTANDABLE BY MEMBERS OF PUBLIC INDICATES THE SAME). REASON BEING CAS ARE AUTHORISED TO WORK IN THE AREA OF FINANCIAL ACCOUNTS ONLY. WHEREAS IN INCOME-TAX ACT, IT IS A TAX LAW AUDIT. THEREFORE ALL PERSONS AUTHORISED TO PREPARE RETURN UNDER RULE 12A READ WITH SECTION 288(2) OF INCOME-TAX ACT, BE ALLOWED TO FURNISH TAX LAW AUDIT REPORT U/S 44AB. HERE MORE STRESS GIVEN TO INTERPRETATION OF LAW. THEREFORE, DECISION OF LEARNED OFFICIALS IN FINANCE MINISTRY TO EXPAND THE DEFINITION OF ACCOUNTANT IN DTC TO INCLUDE RELATED PROFESSIONAL IS APPROPRIATE. I MIGHT HAVE USED THE WORD MOST APPROPRIATE, IF TAX ADVOCATES AND INCOME-TAX PRACTITIONERS WERE ALSO INCLUDED IN DEFINITION OF ACCOUNTANT IN DTC-2013. AS CBDT COULD NOT GET SECTION WISE WRONG CLAIMS IN TAX AUDIT REPORT FURNISHED BY CAS SINCE 1984 TO CONCLUDE QUALITY ASSESSMENT, WHY 2ND OPINION ABOUT EXPANDING THE DEFINITION OF ACCOUNTANT IN INCOME-TAX ACT/DIRECT TAXES CODE.

  2. B.S.K.RAO says:

    As per PTI News Dt.01.11.2013 Madras High Court observed that records revealed certain disturbing features in the functioning of ICAI(Financials). As RTI is in force, mischievous, illegal & selfish action of ICAI (Financials) will not work.

  3. B.S.K.RAO says:

    World over functions of Accounting are classified depending on the area of operation, application & usage. They are as under..

    (1) Cost Accounts=> Manufacturing/Processing Activity..
    (2) Financial Accounts = > Trading Activity..
    (3) Management Accounts => Management Level/Decision Making..

    Note:-Management Accounts is nothing but application of Ratio Analysis and Cash Flow Statement on Cost and Financial Accounts.

    By The Cost and Works Accountants (Amendment) Act, 2011, name has been changed to “The Institute of Cost Accountants of India” and the members got the power to work in the area of Management Accounts also and can re-designate themselves as ACMA/FCMA. Now, it is funny that both institutes passed by an Act of Parliament called by similar short name of “ICAI”. Of course syllabus is almost similar in all the three institutes called by different name of ICSI, ICWAI and ICAI.

    In view of the above amendment, Cost Accountants now possess wide power of working in the area of Cost Accounts, Financial Accounts & Management Accounts. And hence, Institute of Cost Accountants of India should be called full accounting body in India. Whereas, Chartered Accountants are restricted to work in the area of Financial Accounts only. This being the case, I do not understand why only Chartered Accountants are authorized to conduct Tax Audit U/s 44AB of Income-Tax Act and enjoy monopoly of authority, causing strict hurdle for voluntary compliance.

  4. B.S.K.RAO says:

    TO,

    MINISTRY OF FINANCE,
    GOVT. OF INDIA,
    NORTH BLOCK,
    NEW DELHI-110001

    IF DEPTT. OF REVENUE, MINISTRY OF FINANCE, GOVT. OF INDIA DO NOT ACCEDE TO THE ABOVE WISHES. ICAI (FINANCIALS) NOT ONLY ACT WILD/CRUEL, THEY DO NOT ALLOW DTC-2013 TO COME OUT SMOOTHLY. THEREFORE, IT IS BETTER TO ACCEDE TO THE WISHES OF ICAI (FINANCIALS) AND INTRODUCE TAX PRACTITIONERS BILL PREVAILING IN OTHER COUNTRY’S THROUGHOUT THE WORLD TO WIDEN GENUINE TAX BASE OF ASSESSES IN INDIA

  5. SUDIPTA MAJUMDAR says:

    The expansion of definition of Accountant under DTC is welcome change. Much too long, it has been the monopoly of one profession and this monopoly resulted in malpractices leading to huge revenue leakages for the government. Therefore, it is welcome that this monopoly is broken and healthy competition is ushered in. As for competence of other professionals, I understand the other premier institutes have more or less similar expertise. CA’s need not fear encroachment into their domain. It is only the tax practice which is opened up and not the financial audit.Let the country gain by better, effective tax compliance. Let the fittest survive !!!!!

  6. K.MUKAMBIKA says:

    I SUGGEST MY TAX ADVOCATE FRIENDS TO SERVE LEGAL NOTICE ON ICAI (FINANCIALS) ALLEGING ALL THE ISSUES PUBLISHED IN THIS BLOG & TAKE ACTION UNDER PIL. I HOPE THAT MY TAX ADVOCATE FRIENDS WILL CONSIDER MY REQUEST

Leave a Reply

Your email address will not be published. Required fields are marked *