Page 462 - CA Final PARAM Digital Book.

▪ Council General Guidelines 2008

Part II -- Requirements of Relevant Laws
➢ As per Council General Guidelines 2008, a member of the Institute in practice shall not accept, in a
financial year, more than the “specified number of tax audit assignments” under Section 44AB of
the Income-tax Act, 1961.

It is also provided further that where any partner of a firm of Chartered Accountants in practice
accepts one or more tax audit assignments in his individual capacity, the total number of such
assignments which may be accepted by him shall not exceed the “specified number of tax audit
assignments” in the aggregate.

In the case of firm of Chartered Accountants in practice “the specified number of tax audit
assignments” means, 60 tax audit assignments per partner in the firm, in a financial year, whether
in respect of corporate or non-corporate assesses.

Further, as per clarification issued by the Institute on Tax Audit Assignments, tax audit reports may
be signed by the partners in any manner whosoever in accordance with specified audit limits.
Thus, one partner can individually sign all the tax audit reports subject to specified tax audit
assignment limits on behalf of all the partners in the firm of Chartered Accountants in practice or
all the partners of the firm can collectively sign the tax audit reports.
Part III – Case Discussion
➢ In the instant case, there are 6 partners in M/s XYZ & Co., a Chartered Accountants firm,
accordingly specified ceiling limit for the firm will be (60 tax audit assignments per partner X 6
partners) = 360. Therefore, all the 6 partners of the firm can collectively sign 360 tax audit reports.
This maximum limit of 360 tax audit assignments may be distributed between the partners
in any manner whatsoever. For instance, 1 partner can individually sign 360 tax audit reports
in case remaining 5 partners are not signing any tax audit report
Part IV – Conclusion
➢ Assuming Mr. Gaurav has signed 290 tax audit reports consisting of both corporate and non-
corporate assessee on behalf of firm and remaining partners are signing audit reports within the
specified number of tax audit assignments u/s 44AB i.e. Up to 70.
Hence, Mr. Gaurav shall not be deemed to guilty of professional misconduct provided total
number of tax audit reports on behalf of firm do not exceeds 360.

Not Maintaining Books of Accounts (Not Old Course-- (M05E, N05E, M16R, N16R, PM17, SM17, M18R,
QNO Exceeding 44AA Limit) N18E N19E, N22E)
776.000
TITANIUM CNO – PE.1760 New Course—(SM23)
L, a chartered accountant did not maintain books of account for his professional earnings on the
ground that his income is less than the limits prescribed u/s 44AA of the Income Tax Act, 1961.
OR
L, a chartered accountant did not maintain books of account for his professional earnings on the ground
that his income is less than the limits prescribed u/s 44AA of the Income Tax Act, 1961. (PM17)
OR
CA. Elegant is in practice for two years and runs his proprietorship firm in the name of “Elegant & Co.”.
He maintains notes in his mobile in which he writes the fees received from various clients. Based on his
record, he prepares and files his income tax return.
OR
Write a short note on Record of Audit Assignments (as required by ICAI regulations)
OR
Mr. X, a Chartered Accountant in Practice filed his income tax return for the Assessment Year 2018-
19under section 44ADA of the Income Tax Act, 1961, declaring his income on presumptive basis. In
a disciplinary proceeding against him for an alleged misuse of funds of his clients, it was asked that he
should submit his books of accounts for the financial year ended on 31/03/2018. Mr. X refused to
submit books of accounts on the ground that he had not maintained any books and even for
income tax purposes, he submitted his Return of Income on a presumptive basis. Is he right in putting
such a defence? Analyze the issues in the light of Professional Code, if any
Answer Part I -- Relevant Laws

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