Sections 14A and 14AA of the Central Excise Act, 1944 provide for special audit, under certain circumstances, to be done only a Cost Accountant, and not by a Chartered Accountant.
In this connection, it may be mentioned that a Chartered accountant is a professional
who is regulated by the Chartered Accountants Act, 1949 and has been given the onerous
responsibility to attest the fairness, correctness of financial statements as also
certify the tax compliance under Income Tax Act, 1961. The syllabus of the final
examination has a paper on indirect taxation which tests the in-depth knowledge
of the person in this subject. Every Chartered Accountant goes through rigorous
3-years articleship training, which is unparallel in
Therefore, in our view, there is no reason as to why Chartered Accountants should not be included among those who are eligible to perform special audit under Sections 14A and 14AA.
Hence, we suggest that the provisions contained in Sections 14A and 14AA may be suitably amended as under to permit the nomination of Chartered Accountants also for the purpose of special audit:
Draft Notification to be issued:
Notification New Delhi ../2009 GSR (E) In exercise of the powers conferred under the provisions of the Central Excise Act 1944 (1 of 1944), the Central Government on being satisfied that it is necessary in the public interest so to do, hereby makes the following amendments in the following Section 14A and 14AA of the Central Excise Act:
In the said provision, wherever the term Cost Accountant appears, the said word should be read as Cost Accountant or Chartered Accountant.
Explanation: For the purpose of this section, Chartered Accountant shall have the meaning assigned to it in clause (b) of sub-section (1) of Section 2 of the Chartered Accountants Act, 1949 (38 of 1949).
We are sure the above amendment will greatly benefit the Department in finalizing the assessments.