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CAG issues List of CAs issuing more than 400 Tax Audit Report

List of CAs issuing more than 400 TAR; 18.87% CAs issued more than 45 Tax Audit Report- CAG

Control on number of tax audit assignment

In order to maintain the quality of tax audit to be conducted by CAs, ICAI issued Guidelines15 for the Members under the provisions of the Chartered Accounts Act, 1949. It prescribed a limit of 45 tax audit assignments that can be under taken by a CA in a FY under Section 44AB of the Income Tax Act, 1961. In case of a Firm, specified number of tax audit assignments shall be applicable for every partners of the Firm. In view of the enhancement of professional competence of members to perform service in IT enabled environment, ICAI raised (February 2014) the limit of tax audit assignments from 45 to 60, to be made effective from audits conducted during FY 2014-15 onwards.

We observed that there was no system in field offices of ITD to see that a CA had not crossed the limit prescribed by ICAI on number of tax audit assignments. ICAI has prescribed Form of Tax Audit particulars to be maintained by members/Firm. We approached ICAI (August and September 2014) to intimate whether any mechanism exit to ensure the compliance of its guidelines by CAs. It was informed by ICAI (September 2014) that maintenance of records is self regulatory mechanism and the information so maintained can be called upon by ICAI for checking adherence of the guidelines. However, any formal complaint received by ICAI was acted upon within the framework provided in the Chartered Accountants Act and the Misconduct Rules framed there under.

As per the information provided by DGIT (Systems) of ITD (August 2014), 65,898 CAs submitted at least one TAR for AY 2013-14. Out of total 65,898 records of CAs, 81.13 per cent of CAs adhered to the limit prescribed by ICAI. Remaining 18.87 per cent of CAs (12,435 CAs) submitted more than 45 TARs. Excess number of TARs ranged from 46 to 2471. Table 3.1 shows stratification of the total number TARs issued by CAs and its percentage.

15 Council Guidelines no. 1-CA(7)/02/2008 dated 08 August 2008

Table 3.1: Stratification of total TARs issued by CA for AY 2013-14

Range of TARs issued Total Number of Accountants Percentage of Total Accountants
1-45 53,463 81.13
46-100 10,838 16.45
101-200 1,364 2.07
201-300 166 0.25
301-400 45 0.07
401-500 10 0.02
501-1000 11 0.02
> 1000 1 0
Total Accountants 65,898

Table 3.2 shows top 22 CAs who issued more than 45 TARs for AY 2013-14.

Table: 3.2 showing CAs issuing more than 400 TAR for AY 2013-14

Chartered Accountants Membership Number Number of TARs
1.        Pralay Chakraborty 059736 2,471
2.        Partha Pratim Mukhopadhyay 056366 990
3.        R Muralidharan 024060 796
4.        Rajesh Kumar Gupta 074194 640
5.        Swapan Acharyya 062815 638
6.        D Sundararajan 010150 619
7.        B C Vadivel 206700 612
8.        Raj Hans 087767 586
9.        Samir Pushpvadan Gandhi 039251 551
10.    Navin Agarwal 078175 522
11.    Poulose Shaji 022909 513
12.    A Kulathooran Pillai 018792 510
13.    Sukdeb Haider 051185 494
14.    Chetan Premchand Shah 031239 487
15.    P Ramalingam 019516 478
16.    Arun Kumar 097929 461
17.    S Vairavanathan 004736 457
18.    Radhakanta Das 062863 428
19.    Suresh Kumar Goyal 084153 417
20.    Hetal Bhailalbhai Dhamelia 119864 415
21.    TS Ventakaraman Lakshmi 022214 414
22.    Jai Bhagwan Mittal 084512 401

 The information available with DGIT (Systems) has not been shared by ITD to ICAI nor did ICAI approach ever to ITD to furnish such information. In view of lack of monitoring of number of tax audit assignments either by ITD or ICAI, the purpose of maintaining the quality of tax audit have suffered. As the work of tax audit assignments is voluminous work, issuing more than prescribed TARs is fraught to suffer in quality.

In the interest of revenue, the Act should have provision to prescribe for quality of tax audit assignments rather than relying on ICAI. Therefore, ITD may consider making suitable provision in the Act by restricting number of tax audit assignments in consultation with ICAI. In an automated environment of e-filing by CAs, prescribed limit can be adhered by providing suitable controls.

There is no system in ITD to validate the membership number issued by ICAI to stop unscrupulous CAs practicing the profession.

Source- http://www.saiindia.gov.in/english/index.html

Read More- Download CAG Report on Systemic issues in Tax Audit and Controls required

Categories: Income Tax

View Comments (53)

  • A THOROUGH INVESTIGATION SHOULD BE DONE BY ICAI AND CBDT AND ACTION SHOULD BE TAKEN AGAINST THOSE FOUND GUILTY.TO STOP SUCH ERRORS/ACTIONS IN FUTURE PROPER CONTROLS SHOULD BE IN PLACE.

  • ICAI took 10 long years to prosecute Satyam CAs .Come on ICAI you can do better in this case 20 Years............

  • These defames the profession of C.A.
    Strict Action should be taken against them as they avoid the Rules & Regulations of the Institute.
    The Mother Institute's Rules & Regulations should be followed and given respect by punishing such Culprits.
    Because of their deeds the fresher Practicing Chartered Accountants strive for work.
    They valued Money more than quality of Audits
    It is important to note that Chartered Accountant play key role in adding revenue to the treasure of government of India. Getting CA certificate is not that much easy.
    These are done in favour of Un-qualified Accountants & Clients to oblize them.

  • the system of tax audit more than quota as fixed by insitute can stop just in a minute, if ITD & ICAI bring a check point in their softwares regarding the maximum limit of tax audit report that can upload under one membership number.

    but the big question is would the ICAI is serious to do that in the best interest of the profession or not to control the same by seeing the members votes to elect in the central council.

    if our profession is going on in this style, the situation may come, when a CA would feel shame to introduce himself as CA

  • When one has approach or strong political connections , all the laws of the land (specially India ) are silent before him . All your Income tax dept , it's working mechanism , 44AB , scrutiny , penalty proceedings etc. proves more of a Comedy Circus show , when it tries to punish a politically connected criminal -assesses .TO ALL THE READERS , I AM GIVING A RESEARCH ASSIGNMENT . I WANT YOU PEOPLE TO FIGHT WITH DISEASE NOT WITH THE SYMPTOMS. TRY TO EXCAVATE THE TRUTH ABOUT THE INDEPENDENCE OF BHARAT(15-08-1947) , THE PREVAILING CONSTITUTION OF INDEPENDENT BHARAT . DOES THE INTERNATIONAL MAFIAS ( IN THE GUISE OF THE SO-CALLED HIGHLY RESPECTED INTERNATIONAL ORGANIZATIONS ,INSTITUTIONS , ETC. ) HAVE ANY ROLE IN FIXING A GOVERN-MENT UPON US . I am confident , if you carry on research work on your own accord , you will find remedy to all the diseases suffered by Bharat .

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