Income Tax Bill Select Committee Ends Debate: Chartered Accountants Solely Eligible for Tax Audits
The Select Committee reviewing the Income Tax Bill has declared that only Chartered Accountants are eligible to conduct tax audits, ending the long-standing debate on the matter.
The Select Committee appointed by the Government of India to review the new Income Tax Bill has made a clear and final statement: only Chartered Accountants (CAs) are eligible to conduct tax audits under the law. This decision ends a long-standing debate over whether professionals from other fields, like company secretaries or cost accountants, should also be allowed to perform...
The Select Committee appointed by the Government of India to review the new Income Tax Bill has made a clear and final statement: only Chartered Accountants (CAs) are eligible to conduct tax audits under the law.
This decision ends a long-standing debate over whether professionals from other fields, like company secretaries or cost accountants, should also be allowed to perform tax audits.
Income Tax 2025: Will It Save You Money or Cost You More? Find Out Inside! Click here
In its official report, the Select Committee explained that tax audits are highly specialized work. They require deep knowledge of tax laws, accounting, and audit procedures skills that are part of the core training for Chartered Accountants. The Committee said that other professionals do not have the same level of expertise in these areas.
The Committee also referred to Section 44AB of the current Income TaxAct which already says that tax audits must be done by a Chartered Accountant with a valid Certificate of Practice. If a CA loses their certificate, they lose the right to conduct audits.
The Committee pointed out that each professional body in India has its own area of work:
- Chartered Accountants handle financial and tax audits.
- Cost Accountants deal with cost-related audits.
- Company Secretaries focus on company law, compliance, and governance.
The report made it clear that Chartered Accountants are not trying to take over the roles of other professions and other professions should also not try to take over the specialized work of tax audits.
Income Tax 2025: Will It Save You Money or Cost You More? Find Out Inside! Click here
To support its decision, the Committee referred to a past Supreme Court judgment (T.D. Venkata Rao vs. Union of India) which said that only CAs are qualified to do tax audits because of their professional training.
The Committee also looked at global best practices. In countries like the United States and the United Kingdom, tax audits are done only by well-trained financial professionals like CPAs (Certified Public Accountants) and CAs.
“This decision not only confirms our role in tax audits but also increases our responsibility to maintain the highest standards,” CA Atul Modani said.
“This is really a big win for the representation made by ICAI. This is going to be in history books,” CA Akhil Pachori expressed.
With this strong recommendation from the Select Committee, the government is expected to keep tax audits strictly under the authority of Chartered Accountants in the final version of the new Income Tax Bill.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
