Wrigley India Pvt Ltd vs. ACIT (ITAT Delhi), I.T.A. Nos. 5648, 5649 and 5650/Del/12, Date of pronouncing the order : December 31, 2014.
It seems CAs are under attack from all parts of the world for good or not so good reasons. Recently CAG in its report Criticised CAs for alleged Mistakes in Tax Audit Report and signing of Tax Audit Reports more than the prescribed limit.
ITAT Mumbai has also sounded warning on falling standards of CA profession in the case of Vijay V Meghani vs. DCIT.
In One more blow Finance Ministry has already Proposed to amend the definition of the word Accountant under the Direct Tax law and to include Cost Accountant, Company Secretary etc. in the definition. This will enable other professionals also to Conduct Tax Audit and other Certification under the Income Tax which is till now the sole domain of Chartered Accountants.
In a new blow to CA Professionals ITAT Delhi has held in the case of Wrigley India Pvt Ltd vs. ACIT has drawn the following conclusion from Transfer pricing Study Reports prepared by CAs and studied by them over a period of time:-
- These TP reports as also certifications by the chartered accounts inspire no confidence.
- Nothing can justify pathetic level of professional work done by chartered accountants.
- Chartered Accountants also responsible for frivolous litigation.
- No purpose served by TP Reports of chartered accountant when reports do not even point glaring infirmities in taxpayers approach vis-a-vis the transfer regulation.
- in an alarming number cases, these audit reports, rather than painting a true and fair picture of the relevant facts, tend to epitomize the art of constant hedging and manoeuvring by the professionals so as they stay within the confines of permissible professional conduct and are yet able to sidestep the inconvenient realities.
Relevant Para of the Judgment is as follows :-
(Article is Compiled by CA Sandeep Kanoi)