WHY ONCE AGAIN AUDIT U/S 44AB OF INCOME-TAX ACT

(1) 46 Plus Certificates from only Chartered Accountants prevailing in Income-Tax Act barricade

support from other 4 class of Non-CA Tax Professionals, causing strict hurdle for voluntary

compliance, resulting in not widening tax base in India. Present strength of 69,630 Practicing CAs

does not meet the requirements on one hand & Non-CAs Tax Professionals have to search for empty

slots of Practicing CAs Signature to give compliance in case of their clients covered by 44AB

Certificate during due dates-See Attachment..S.44AB has become big business & one of the

peculiar situation prevailing only in India in the process of tax law compliance.

(2) World over functions of Accounting are classified depending on the area of operation, application

and usage. They are as under.

Cost Accounts >Manufacturing/Processing Activity

Financial Accounts >Trading Activity

Management Accounts >Management Level/Decision Making

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 or FCMA. Cost Accountants now possess wide power of working in the area of Cost

Accounts, Financial Accounts & Management Accounts. Whereas, Chartered Accountants are

restricted to work in the area of Financial Accounts only - Accounting of Trading Activity Only. Hence,

ICAI-Cost & Management should be called full accounting body in INDIA-See Attachment

(3) Audit is not the domain of CAs. 46 Plus CA Certificates prevailing in IT Act taking away original

intention of legislature in Rule 12-A of IT Rules. In Rule 12-A of IT Rules, out of 8 only 5 class of

Authorised Representatives are licensed to prepare Income-Tax returns. When all 5 class are

licensed, how Deptt. of Revenue took the stand that granting certification powers to other 4 class of

Non-CA Tax Professionals felt not feasible-See Order No.148/8/2015-TPL Dt.26.08.2016 issued by

CBDT-See Attachment. When Rule 12-A takes care of Audit, why once again 44AB Audit inserted in

the statute book of Income-Tax Act.

Author : B.S.K.RAO, Auditor & Tax Advocate, BDKRAO, Beside SBI, Shimoga-577201, Karnataka MO : 0-9035089036, E-Mail : raoshimoga@gmail.com

GOVERNMENT OF INDIAINCOME.TM DEPARTMENT

OFFICE OF THE ADDITIONAL DIRECTOR OF INCOME TAX (CPC)(e-Filing)

Centralised Processing Centre, I Floor, Prestige Alpha Building,

No. 48/1, 4Sl2,Beratenagrahara, Hosur Road, Bangalore-560 100.

dd l. DIT/CPC(e-Fi li ne)/Rrt / 2oLs-L6 / Dated: 04/06/20L5

The CPIO,

CPC, Bangalore

Madam,

sub: Application u/s 6(3) of the RTI Act, 2005 filed by shri B s K Rao - reg.

Ref: F.No/l nfo/46/ AprnlcPto/2oL5-!6 dated 25/05l2oL5

With reference to the above mentioned application. The response in respect of

the said RTI application is as follows:-

Yours faithfully

Deputy Director(Systems)

CPC, e-Filing,Bangalore.

Particulars Asst. Year 20I2-t3 Asst.Year 2Ot3-L4 Asst. Year 1OL4-L5

Total lncome-Tax Admitted in ITR-4(nupees tn Crores) 43996 4366135604

Total lncome-Tax Admitted in ITR-5

(Rupees ln Crores) 2]-282 25294 27942

Total lncome-Tax Admitted in ITR-6

(Rupees ln Crores) 242707 262628 29033s

Number of Tax Audit Cases Covered 1871845 L757697 L832547

Number of Unique Auditors signed 69L47 59133 59630

EXHIBIT-2

Name of Applicant

Address of Applicant

Application Registration No.

Date of Application

Date of CIC order

Date of receipt of CIC order

Date of order

1481812015-TPL

Government of IndiaMinistry of finance

Department of Revenue

Central Board of Direct Taxes

(Tax Policy and legislation)

New Delhi, 26'o August 2016

Order under Risht to Information Act.2005

BSK RAO

BDKRAO BESIDE SBI, TILAKNAGAR SHIMOGA -577201

P*TV t826120 I 4/PMR

26.03.2014

9.08.2016

17.08.2016

26.08.2016

Order

Please refer to CIC order dated 9.08.2016 directing the CPIO, this office to take

necessary action on the RTI application dated 26.03.2014 referenced vide

PMOIN/R/2014160331 seeking information on the queries raised in the above mentioned RTIapplication. The CIC has ordered the CPIO to furnish the information within 2l days of the

receipt of CIC orderon information pertaining to item no (4) in the RTI application.

2. In compliance with the direction of CIC, the above mentioned RTI application

received during the course of CPIO hearing has been examined. It may be noted that this

_4!yi.qioq has not received the RTI application prior to CPIO hearing notice. Subsequently, it isfound that in the application there were four items of which first three items were illustrativein nature and item No. 4 seeks information from this offtce.

3. Item No. 4 of the application has been reproduced for necessary reference:

(4) At the time of releasing election manifesto on 26.03.2014, your honour talked

about focus on creation of employment. In this regard kindly provide me action taken by the

Govt. about degeneration of self-employment of well diversified group of Non-CA Tax

P r ofe s s i onal s of Indi a.

4. In this regard as directed by CIC order dated 9.08.2016; i am furnishing the

following information.

This division does not deal with employment generation or degeneration activity ofNon-CA tax professionals and no statistics pertaining to employment generation ordegeneration in general is maintained with this division. However your core suggestion inthe RTI application with respect to well diversified group of Non-CA tax professional to be

empowered to conduct Audit of tax cases as per section 44AB of the Income Tax 196l has

been received by this divisian through similar such requests given vide other RTI Jiled by you

before this ffice such as RTI registered vide CBODT/R/2014/65013 dated 17.3.2014.

Accordingly it was found that this suggestion was considered for annual budget discussion

and examined for necessary amendments in Income Tax Act 196l during the enactment ofFinance (No.2 ) Act,2014. During the course of Budgetary discussion the proposal was foundnot feasible at the time of framing of Finance (No.2) Act,20I4. Hence the same was not

implemented in the Finance (No 2) Act,2}l4.

5. In this context, it is may also be mentioned that the guidelines have been issued by

DOPT vide F. No. 1/4/2008-IR dated 25.04.2008 for dealing with RTI application. Whereinvide Para 9 of this guidelines states that:

"9 only such information is required to be supplied under the Act which already exists

and is held by the public authority or held under the control of the public authority. It is not

required under the Act to create information; or to interpret information; or to solve theproblems raised by the applicantSl or to furnish reply to hypothetical questions".

6. Thus those items falling within the purview of information available with this division has

been communicated. Further, this office is not empowered to interpret information to create

information or to communicate an opinion of higher authority under the RTI $ct. &.\o\

(Lal&hmiUnder Secretary GPL-UI)

2005.

Shri B.S.K. Rao,

ft.dito, &Tax Advocate, BDKRAOr-l Beside SBI, Tilak Nagar,

Shimo ga 57 7 201 (Kaarnataka)

Copy submitted to

Shri. Basanth Seth

Information CommissionerClub Building (Near Post Office)Old JNU Campus, New Delhi - 110067