Professional classification in tax audit law upheld; exclusion of income-tax practitioners from audit role did not violate constitutional rights.

Section 44AB of the Income-tax Act was upheld as constitutional because requiring audit by an accountant, and excluding income-tax practitioners from that role, was held to rest on a rational classification based on professional expertise. The Court accepted that chartered accountants form a distinct class with special training and aptitude in auditing accounts, so the differential treatment did not violate Article 14. The Article 19 challenge also failed because income-tax practitioners remained entitled to act as authorised representatives of assessees, and the audit restriction did not amount to an impermissible restriction on their rights. The provision was therefore valid.

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Issues: Whether section 44AB of the Income-tax Act, 1961, requiring audit by an accountant and excluding income-tax practitioners from that role, was unconstitutional under Articles 14 and 19 of the Constitution of India.

Analysis: The audit requirement was upheld on the basis that chartered accountants constitute a distinct class with special training and aptitude in auditing accounts. The exclusion of income-tax practitioners from the category of persons authorised to audit accounts was held to rest on a rational classification linked to professional expertise. The challenge under Article 19 also failed because income-tax practitioners continued to remain entitled to act as authorised representatives of assessees, and the audit restriction did not amount to an impermissible infringement of their rights.

Conclusion: The provision was held to be valid and the constitutional challenge under Articles 14 and 19 failed.

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