In a key submission before the Parliamentary Committee reviewing the draft of the new Income Tax Bill, experts and stakeholders have strongly recommended that the definition of "accountant" under Section 288 of the Income-tax Act remain unchanged. The emphasis was placed on preserving the exclusive right of Chartered Accountants (CAs) to conduct tax audits under Section 44AB.
One of the expert witnesses cautioned against the growing pressure from other professional bodies-including company secretaries-seeking eligibility for conducting tax audits. The witness highlighted that such professionals, though capable in their respective domains, lack the core taxation and audit expertise required for this specialized role.
The submission referenced the legislative framework governing professional qualifications, including the Chartered Accountants Act, 1949, the Cost and Works Accountants Act, 1959, and the Company Secretaries Act, 1980, which clearly delineate professional domains. It was emphasized that while CAs do not encroach upon functions reserved for cost accountants or company secretaries, the same respect must be reciprocated, especially concerning tax audits.
Citing judicial precedents-most notably the Supreme Court's ruling in T.D. Venkata Rao vs. Union of India-the stakeholders argued that CAs possess a distinct aptitude for audit, derived from rigorous training, comprehensive examinations, and mandatory practical experience.
The submission further pointed to global practices, noting that in countries like the United States and the United Kingdom, tax audits are reserved for Certified Public Accountants (CPAs) and Chartered Accountants, respectively. Allowing non-CAs to conduct tax audits in India, it was argued, would undermine audit integrity, reduce public trust, and bring inconsistency with global tax administration norms.
Experts concluded that diluting the definition of 'accountant' could adversely affect audit quality, erode stakeholder confidence, and introduce regulatory confusion, at a time when tax governance in India is moving towards greater transparency and compliance.
As the government proceeds with reforms under the proposed Income Tax Bill, 2025, this submission adds a significant voice in favor of upholding the existing legal and professional safeguards that entrust the tax audit function solely to Chartered Accountants.
Also Read: Lok Sabha Select Committee Submits Key Recommendations on Income Tax Bill, 2025
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