Standing committee(DTC Bill) submit favourable report for CMA and CS

ACMA-ICAI (DGM-Global Voice Business)   (1052 Points)

10 March 2012  

Great day for Cost and Management Accountants and Company secretaries. Standing Committee for Direct Tax code 2010 has submitted it report on 9th March, 2012.

Standing committee has  given favourable opinion for Inclusion of Cost and Management Accountants and Company secretary for inclusion of Accountant definition under Direct Tax code 2010.

The Committee has received representations from ICWAI and ICSI demanding changes in the definition of accountant and accountant member. ICWAI has suggested that since these are exclusive domain of Cost Accountants as per sec 2(2) of the Cost and Works Accountants Act, 1959, the Cost Accountants should be included in the definition of Accountants as per Clause

314(2) of the DTC Bill, 2010. Segmental reporting including ascertainment of cost and profitability should be introduced to ensure correctness of product-wise, unit-wise profitability as per clause 31(2) which should be certified by Cost Accountant in practice as per meaning of Cost and Works Accountants Act, 1959. 17.5 ICSI has suggested that ―Company Secretary within the meaning of the Company Secretaries Act, 1980(Central Act 56 of 1980)‖ in the definition of ―Accountant‖ and ―Accountant Member‖ so as to give them the same privilege as given to the Chartered Accountants. Specific entry in respect of Company Secretary under Clause 304(3) on ―Appearance by Authorized representative‖ or in other applicable provisions be made to define Authorised Representative specifically. The Institute of Company Secretaries of India is a premier professional body established under an Act of Parliament, i.e., the Company Secretaries Act, 1980. Company Secretary, a competent professional comes in existence after exhaustive exposure provided by the Institute through compulsory coaching, examinations, rigorous training and continuing education programmes, and is governed by the Code of Conduct contained in the Company Secretaries Act, 1980. The curriculum of Company Secretaryship Course includes, inter-alia, detailed study of Direct Taxation, Indirect Taxation and Financial Accounting. Thus, vast exposure is provided to the Company Secretaries in the areas of taxation and accounts, enabling them to acquire proficiency in taxation and other related subjects. Secretary of a company has been recognized as a key managerial personnel of the company under the Companies Bill, 2011 and principal officer of the company responsible for its affairs under a host of legislations including Companies Act, 1956, Customs Act, 1962, Central Excise Act, 1944, etc. This Code also recognizes Secretary as Principal Officer [vide Clause 314(200)].

Standing committee recomendations


The Committee observe that the Ministry‟s reasoning for non-inclusion of related professionals in the definition of accountant is a very strict construction of the term. In the view of the Committee, the suggested amendment may provide the Small and Medium Enterprises (SMEs) a wider and cost effective scope for selection of professionals and will be an important initiative towards simplified tax compliance regime. The Ministry may therefore re-consider the suggestion to widen the scope of the definition of "accountant".