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

CA should think twice before signing Project Report or Estimates or Provisional Figures after UDIN

ADMIN by ADMIN
March 16, 2020
in Business & Other News
0
CA cannot certify Income tax return (ITR) even for loan purpose:
1.3k
SHARES
16.3k
VIEWS
image_pdfPDFimage_printPrint

In a case, Calcutta High Court comes hammer & tongs at CAs.

In the latest judgement in Binod Kumar Agarwala vs. CIT, the Hon’ble Calcutta High Court has signaled a zero tolerance policy towards the alleged nefarious practice of CAs.

The High Court slammed the CAs for certifying bogus loans and misleading lenders, which in turn has led to the colossal NPAs.

“The matter is typical of how business is conducted in this country and why loans obtained from banks remain unpaid,” the High Court observed.

The assessee committed fraud on the bank and obtained credit facilities by misrepresenting its financial position.

To aid him in the criminal act, a firm of chartered accountants named ‘Roy Ghosh and Associates’ issued a certified balance sheet containing  bogus figures.

The CA firm boldly issued a disclaimer stating that the figures “have no relation with the actual figures”.

“We are giving the information and explanations herewith purely based on estimate basis and have no relation with the actual figures and to avail the bank loan.”, it was stated.

The High Court seethed with anger at the blatant temerity of the Chartered Accountant in certifying the bogus balance sheet.

“The substance of the appellant’s submission is that to suit a person’s purposes before one authority or the other, different pictures as to the financial position of such person or any entity under the control of such person may be presented.

This is a question larger than any legal issue under the Income Tax Act and is a matter of public policy.

It is inconceivable that a person may approach a bank by inflating the value of his assets and a few months down the line he can  deflate the value of the assets, so to say, while queuing up to pay tax.”

It is scarcely expected of a banker to question the veracity of any accounts certified by a firm of chartered accountants or to look into the fine print and comprehend therefrom that utterly bogus figures had been furnished only for the purpose of availing of the credit facilities from the bank”, it was observed.

The High Court came down heavily on the practice of painting a rosy picture as to the financial position of the applicant seeking credit facilities while at the same time slipping in another balance-sheet and P&L A/c in the income-tax records indicating a less robust financial position of the constituent.

It described Roy Ghosh and Associates as a “willing accomplice” to this criminal and fraudulent practice.

It also held that the accounts cannot be “tailor-made to suit a particular purpose or window-dressed to make it attractive for bankers to rely thereupon and all the gloss and sheen removed thereafter when it was the time to pay tax.”

ITAT hauled up for not reporting the CA to the ICAI.

The ITAT passed strictures and observed that a Chartered Accountant is governed by certain discipline and he has to conduct audit in accordance with the provisions and rules of the Chartered Accountants  Act.

It also noted that Schedule II and Part 1 holds a chartered accountant guilty of professional misconduct if he permits his name or name of his firm to be used in connection with the audit based on estimate.

However, the High Court hinted that the ITAT should have gone further and been vigilant towards the abatement by the CA in the “commission of a colossal act of misrepresentation”.

“Indeed the Appellate Tribunal may only be faulted for not  reporting Roy Ghosh and Associates to the Institute of Chartered Accountants for having apparently abetted in the commission of a colossal act of misrepresentation which the appellant assessee undertook before his bankers for the purpose of obtaining credit facilities by  indicating a financial position that was not warranted by the books of the assessee”, it held.

Ultimately, the Hon’ble High Court directed that a copy of the order be sent to the ICAI for appropriate steps, if thought fit, to be taken against Roy Ghosh and Associates in accordance with law and upon due notice to such firm of CAs.

ICAI was directed to examine the issue. The ICAI, on the basis of the orders of Hon’ble High Court, issued a show cause notice to the Firm calling upon its explanation in this regard. However, the said Firm of Chartered Accountants have vehemently denied stating that their Firm had not prepared those documents and their signatures and stamp has been forged. The firm had also submitted of having filed a FIR with Khargpur Police and a sworn affidavit affirming their non-association in this matter. However, Director (Discipline), ICAI is further examining the matter.

This case was decided before UDIN was introduced, now with UDIN it would be very much difficult for any auditor to deny the certificate issued by him and hence it is advisable to check the certificates twice before issuing.

You can download the entire Order HERE.

 

This article is just for information purpose it is always advisable to hire a professional for practical execution. 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

GST Impact on Textile Industry and suggestion to increase GST rate on garments

Next Post

Sale of listed mutual fund by an NRI wont be liable to Income tax

Related Posts

ICAI has announced a new MBA programme for Diploma in Management and Business Finance
Business & Other News

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

September 20, 2023
Compliance due dates for June, 2020 | Compliance calendar for June, 2020 | 20+ compliances
Business & Other News

Statutory Compliance Calendar for September 2023 | Income tax, GST and various other laws

September 6, 2023
RBI to end it’s Fiscal Year 2019-20 on 30.06.2020 | Fact check | Change in Accounting year for 2019-20
Business & Other News

RBI launches उद्गम – UDGAM – Centralised Web Portal for searching Unclaimed Deposits

August 21, 2023
ICAI has announced a new MBA programme for Diploma in Management and Business Finance
Business & Other News

Relaxation to Old Course Students to commence 3 years of Practical Training – ICAI

August 16, 2023
Compliance due dates for June, 2020 | Compliance calendar for June, 2020 | 20+ compliances
Business & Other News

Statutory Compliance Calendar for August 2023 | Income tax, GST and various other laws

August 4, 2023
Compliance due dates for June, 2020 | Compliance calendar for June, 2020 | 20+ compliances
Business & Other News

Statutory Compliance Calendar for July 2023 | Income tax, GST and various other laws

July 6, 2023
Next Post
Which income of Non-resident are taxable in India? And understanding calculation of residential status

Sale of listed mutual fund by an NRI wont be liable to Income tax

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!