Taxontips
No Result
View All Result
Monday, September 25, 2023
Login/ Register
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Talk to an Expert
  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
No Result
View All Result
Taxontips
No Result
View All Result

Auditor should not sign the audit report in a hurry – Penalty of Rs. 10,000 u/s 271-J of Income Tax Act.

Income tax Expert by Income tax Expert
October 26, 2019 - Updated on October 29, 2019
in Income Tax News
0
Auditor should not sign the audit report in a hurry – Penalty of Rs. 10,000 u/s 271-J of Income Tax Act.
115
SHARES
1.4k
VIEWS
image_pdfPDFimage_printPrint

With the last few days for Tax audit there are many people who have still not finalized their books of accounts and then they will go to the Chartered accountant on the last moment to finalize and file audit report for them. There are many young Chartered Accountant’s as well as some experienced CA who just with the fear of loosing a client conduct the audit without checking anything as they would think if I would refuse him there are many CA who would do such audit and take fees so it’s better we do it and such clients also don’t pay proper fees, as we all know how much fees a CA get’s for such small audit’s and we do such audit because there was not much liability on us, atleast not in monetary terms. However, now with the introduction of section 271J even the CA have monetary liability for signing such audit report.

Let’s read what section 271J has to say which was inserted by Finance Act, 2017 w.e.f. 01.04.2017 in the Income Tax Act:

“Without prejudice to the provisions of this Act, where the Assessing Officer or the Commissioner (Appeals), in the course of any proceedings under this Act, finds that an accountant or a merchant banker or a registered valuer has furnished incorrect information in any report or certificate furnished under any provision of this Act or the rules made thereunder, the Assessing Officer or the Commissioner (Appeals) may direct that such accountant or merchant banker or registered valuer, as the case may be, shall pay, by way of penalty, a sum of ten thousand rupees for each such report or certificate.”

From the above section it’s clear that this section is not only applicable to CA but also merchant bank and registered valuer for certificate as well as any report issued under provisions of this act i.e. it is applicable to valuation done for land in case of capital gain by registered valuer or valuation of unlisted shares by merchant banker and the penalty for providing and certifying such false information would be Rs. 10,000.

As mentioned above we all know we are not paid much fees for such audit and this penalty needs to be paid by auditor and not assessee and you will come to know about this after 1-2 year probably during the assessment proceeding of such assessee and there are chances that you will not be in contact of that assessee and more than that it will also create a bad impression of you as an auditor in front of the Assessing officer and with advancement of assessment proceedings and automation of penalty you can receive a penalty notice and you will have no chance but to pay such penalty from your earning and in last minute audit there are chances you make some unintentional error.

Now, I know we put some observations that we have not conducted full 100% audit and audit has been conducted on sample basis but there are many CA’s who don’t put any observations and give a clean report and are also pressurized by client’s to issue a clean report as they need to submit it somewhere, may be with the bank for a loan. At that time this young CA should also think of themselves and put the necessary observations rather than signing such Audit report just with the fear of loosing one client.

Since the client thinks of himself and wants to save himself from penalty of not conducting Audit, which is 0.5% of total turnover/ receipts or 1.5 lakh whichever is lower, we must also think of our penalty and reputation when we take such assignments and this would come only when all the practicing CA decide to conduct audit properly and not accept any last minute complicated Audit because there are various case laws and instances using which assessee can save himself from such huge penalty but a CA won’t be able to save himself from such penalty and this can also attract some disciplinary actions so it’s better to sign audit report which are properly examined by you.

In the last few years we have seen various cases of involvement of CA in issuing some incorrect reports which has lead to some fraud and various GST fraud as well. We must try to follow fair practice and keep the dignity of this profession maintained.

If you need assistance you can ask a question to our expert and get the answer within an hour or post a comment about your views on the post and also subscribe to our newsletter for latest weekly updates.

image_pdfPDFimage_printPrint
Previous Post

What is cost inflation index and when its useful?

Next Post

Monetary Limit for filing Appeal by Income Tax Department Revised/ Enhanced by CBDT:

Related Posts

Tax audit u/s 44AB to be scrapped?
Income Tax News

Extension of time limit for Tax audit of trust and file Form 10B and Form 10BB and ITR 7

September 18, 2023
Tax audit u/s 44AB to be scrapped?
Income Tax News

Turnover limit for Tax audit is Rs. 1 crore or Rs. 10 crore under section 44AB of the Act

September 18, 2023
Guidelines for manual selection of returns for Complete Scrutiny during the financial-year 2019-20-
Income Tax News

Digital Signature Certificate (DSC) related issues and solutions on Income tax E-filing portal

September 16, 2023
How to calculate turnover in case of intra day and future and option trading for Income Tax purpose?
Income Tax News

Definition of turnover in relation to F&O and intraday as per Revised guidance note of ICAI on Tax audit for 2023

September 13, 2023
No TDS on interest income upto Rs. 40,000 from bank – Section 194A Limit revised
Income Tax News

Claim TDS credit deducted in next assessment year for income offered in earlier year [Read section]

September 9, 2023
Received mail from GSTN “Aggregate turnover being more than Rs. 5 Cr during FY 2019-20” What does this mean?
Income Tax News

Salaried employee receiving notices for claiming deduction under Chapter VI-A

September 7, 2023
Next Post

Monetary Limit for filing Appeal by Income Tax Department Revised/ Enhanced by CBDT:

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Google Custom search

Recent Posts

  • Advisory: Geocoding Functionality for the Additional Place of Business – GST website
  • Multipurpose Empanelment Form (MEF) – 2023-24 | Now Open
  • Extension of time limit for Tax audit of trust and file Form 10B and Form 10BB and ITR 7
  • Turnover limit for Tax audit is Rs. 1 crore or Rs. 10 crore under section 44AB of the Act
  • Digital Signature Certificate (DSC) related issues and solutions on Income tax E-filing portal

Recent Comments

  • Srinivasan Venkatasubramanian Venkatasubramanian on GST turnover limit for services increased to Rs. 40 lakh by CBIC?
  • Notification under PMLA by Ministry of Finance which could affect CA, CS and CMA - Taxontips on CA, CS and CMA now under PMLA. KYC of clients required
  • ITR 4 is now available on e-filing website for FY 2022-23 i.e. AY 2023-24 | File ITR with experts on Taxontips – Taxontips on Businessman with turnover below 1 crore and having profit below 8% need to compulsorily get books of accounts audited: Let’s find out
  • Can a person earning income from speculative business transaction file return u/s 44AD of Income tax act - Taxontips on How to calculate turnover in case of intra day and future and option trading for Income Tax purpose?
  • Extension of last date for updation of Member’s Profile with GSTIN at Self Service Portal – Till 23rd April, 2023 - Taxontips on Updation of Member’s Profile at Self Service Portal with GSTIN to get GST credit till 15.04.2023

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Browse Topics by Date

September 2023
M T W T F S S
 123
45678910
11121314151617
18192021222324
252627282930  
« Aug    
  • GSTR 9/ 9C extended : AGAIN

    GSTR 9/ 9C due date to be extended to 31.10.2020 | E-invoicing will be voluntary in the beginning

    6457 shares
    Share 2583 Tweet 1614
  • How to pay Membership and COP fees of ICAI for 2020-21 |

    6351 shares
    Share 2540 Tweet 1588
  • Code/ Nature of payment 6CR updated by NSDL in challan 281 for paying TCS on sale of goods

    5732 shares
    Share 2293 Tweet 1433
  • Are all the due dates of tax audit and Income tax return for FY 2019-20 extended to 31.03.2021 by the bill presented in Lok sabha Dt. 18.09.2020

    4772 shares
    Share 1909 Tweet 1193
  • SFT transaction mentioned in Form 26AS | What does it mean? | Who reports it? | SFT codes transaction type

    3999 shares
    Share 1600 Tweet 1000

Recent Notification

Data of GST website under comparison of liability declared and ITC claimed tab not available

Advisory: Geocoding Functionality for the Additional Place of Business – GST website

September 21, 2023
ICAI has announced a new MBA programme for Diploma in Management and Business Finance

Multipurpose Empanelment Form (MEF) – 2023-24 | Now Open

September 20, 2023

RSS Taxontips

  • Advisory: Geocoding Functionality for the Additional Place of Business – GST website
  • Multipurpose Empanelment Form (MEF) – 2023-24 | Now Open
  • Extension of time limit for Tax audit of trust and file Form 10B and Form 10BB and ITR 7
  • Turnover limit for Tax audit is Rs. 1 crore or Rs. 10 crore under section 44AB of the Act
  • Digital Signature Certificate (DSC) related issues and solutions on Income tax E-filing portal
  • How to calculate Value of supply in case of online gaming including online money gaming [Read notification]
  • Introducing Electronic Credit Reversal and Re-claimed statement on GSTN
  • Definition of turnover in relation to F&O and intraday as per Revised guidance note of ICAI on Tax audit for 2023
  • Claim TDS credit deducted in next assessment year for income offered in earlier year [Read section]
  • Salaried employee receiving notices for claiming deduction under Chapter VI-A

Categories

  • Budget News
  • Business & Other News
  • Case Laws
  • GST news
  • Income Tax News
  • News

Site menu

  • Home
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST Registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • Q & A
  • About us
  • Contact us
Taxontips

TaxOnTips provides you all tax related solutions in easy way and update you with its regular updates & notifications Visit us for details.
We are based in Jaipur, India

© 2019-2023 Taxontips.com - Tax assistance at your Fingertips

No Result
View All Result
  • Login/Signup
  • Income Tax
    • Income Tax Return
    • Tax Notice/ Personal consultation
    • Compliance Notice
    • Faceless Assessment
  • GST
    • GST registration
    • GST Consultation
  • News
    • Income Tax News
    • GST news
    • Budget News
    • Business & Other News
  • About us
  • Contact us
  • Ask an expert/ Talk to an expert
  • Q & A
  • Privacy Policy
  • Terms of use

© 2019-2023 Taxontips.com - Tax assistance at your Fingertips

Book Phone consultation with expert

Sitting home or at your office and don't have time to visit CA's office or don't know where to consult CA. Book your consultation with an expert practicing Chartered Accountant and get your query solved.

Book a phone consultation for 30 minutes with our expert at a very basic cost.

Book consultation

No thanks, I'm not interested!