law

This article has been written by Abhyuday Agarwal, COO and Co-Founder of LawSikho and Mansi Bathija, student of School Of Law, UPES, Dehradun.

Most of us know that Chartered Accountants have a very high level of training in accountancy, auditing and tax-related work. Businesses engage CAs to minimize their taxes and to make certain categories of tax filings and MCA filings.

Similarly, Company Secretaries are primarily engaged for incorporation of companies, preparation of secretarial documents and making regulatory form filings before the Ministry of Corporate Affairs (MCA) and a few other regulators. They are responsible for ensuring that the company’s paperwork is in order and also issue compliance certificates to that effect.

Cost accountants have their own niche and are engaged for preparation of cost records and cost auditing under the Companies Act and Rules.

This work, however, is just the tip of the iceberg. There is a niche of very lucrative work that accountants and company secretaries are completely missing out on. And that is litigation before certain authorities that permit them specifically to represent clients and argue on behalf of clients, just like lawyers would do.

Would you like to represent clients in various regulatory and administrative forums, and argue before tribunals? Most CAs, CS and cost accountants do not do this, but this can be a brilliant opportunity.

Some of you who are CAs may already be performing tax litigation work, or as a CS you may be performing contract drafting work, but don’t let that knowledge prevent you from reading further.

We have discussed a far wider range of regulatory work below and unveiled new reasons as to why CAs, CS and cost accountants have an edge with respect to this kind of work. For example, did you know that you can argue before SEBI Adjudicating Officer, SAT, Electricity Regulatory Commission, Board of Approvals of an SEZ, etc?

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Before we get into details about that, let’s take a quick look at the forums and authorities I am referring to. This knowledge is closely guarded, and most have no inkling of this, and I am sure that you are going to read about this over here for the first time.  

Don’t worry, you can verify all this information on your own. We will make that easy for you. Read on.

 

Name of the Acts

Names of officer/ forums

Chartered Accountants

Company secretaries

Legal practitioners

Cost accountants

Income tax Act 1961

(Sections 288, 245R(5), 250(2) and 269O read with Rule 51 of Income Tax Rules 1962)

Assessing Officer, CIT (Appeals), Income Tax Appellate Tribunal

✔️

✖️

✔️

✖️

Customs Act 1962

(Section 146A read with Rule 9 of Custom(Appeals) Rules 1982)

Customs Officer, Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Commissioner (Appeals)

✔️

✔️

✔️

✔️

Central Excise Act 1944

(Section 35Q read with Rule 232B of Central Excise Rules 1944)

Central excise officer, Customs Excise and Service Tax Appellate Tribunal(CESTAT), Commissioner of Central Excise(Appeals)

✔️

✔️

✔️

✔️

CGST Act 2017

(Sections 116 and 98)

Any CGST officer, appellate authority and Goods and Services Appellate Tribunal

✔️

✔️

✔️

✔️

Companies Act 2013

(Sections 300 and 432, Rules 23 and 45 of the NCLT Rules 2016)

National Company Law Tribunal (NCLT) and Appellate Tribunal (NCLAT)

✔️

✔️

✔️

✔️

Competition Act 2002

(Sections 35 and 53S)

Competition Commission of India and National Company Law Appellate Tribunal(NCLAT)

✔️

✔️

✔️

✔️

SEBI Act 1992

(Section 15V read with Rule 4(3) of SEBI(Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer)Rules 1995)

Adjudicating Officer and Securities Appellate Tribunal

✔️

✔️

✔️

✔️

Securities Contracts (Regulation) Act 1956

(Section 22C)

Securities Appellate Tribunal

✔️

✔️

✔️

✔️

TRAI Act 1991

(Section 17)

Telecom Disputes Settlement and Appellate Tribunal

✔️

✔️

✔️

✔️

SEZ Act 2005

(Section 16(4) read with Rule 61 of SEZ Rules 2006)

Board of Approval

✔️

✔️

✔️

✔️

The Electricity Regulatory Commissions Act 1998

(Section 26 and Rule 23 of CERC Conduct Of Business Regulations 1999)

Central and State Electricity Regulatory Commissions

✔️

✔️

✔️

✔️

FEMA 1999

(Sections 16 and 32)

Appellate Tribunal for Forfeited Property, Special Director(Appeals) and Adjudicating Officer

✔️

✖️

✔️

✖️

Airports Economic Regulatory Authority of India Act, 2008

(Section 30)

Airport Economic Regulatory Authority Appellate Tribunal

✔️

✔️

✔️

✔️

While CAs, CS or cost accountants cannot represent clients in the High Court and Supreme Court (that right is restricted to advocates), it does not in any way indicate that work at lower forums is less important. In fact, it may be quite the opposite. Firstly, out of the total number of cases filed at the High Court (as writs) or Supreme Court (as SLPs) only few are admitted. In comparison, a statutory appeal before a tribunal is usually granted as a matter of statutory right. There is a lot you could do at the tribunal level!

Secondly, given that facts are shaped at the earlier stages, a professional who represents his or her clients before regulatory/ administrative authorities and tribunals has a much broader framework to operate in to shape the direction of the case. It is this framework within which a lawyer will subsequently operate in, if the matter proceeds subsequently to the High Court or Supreme Court.  

Thirdly, writs or appeals are fewer in number than the original matters. Every client who receives an adverse order does not want to incur the additional cost and struggle of filing an appeal. Legally as well, appeals to the High Court or Supreme Court can only be filed on very limited points of law. Thus, the set of matters which are filed in the High Courts and Supreme Court are much fewer in number in comparison to the work available at the original stage, before the officers and appellate tribunals.

Many CS or CAs believe that drafting contracts or interpretation of statutes and representing clients is not their cup of tea, and that lawyers are best suited for it. However, that may not necessarily be true.

Legal, argumentative and drafting skills can be picked up by anyone. Most Indian law schools do not teach how to perform practical legal work, so even most lawyers end up starting to learn practical aspects of the law and how to perform client work from scratch after they graduate, and pick up these skills over a few years as they practice.

Sometimes a CS may know a lot more about procedures than a lawyer. This is the reason why law students who want to pursue a career in corporate law are often advised to pursue the Company Secretary course. It is based on the assumption that they will learn the procedures in much greater detail than what they learn in the LLB course.

We have ourselves seen this notion turned on its head as we saw CAs, CS, managers, working professionals learn how to draft effective contracts after pursuing our contract drafting diploma. We even started developing materials and virtual classroom-based training to teach HR managers (without a law degree) how to draft various contracts, policies, disciplinary orders and responses to show-cause notices for one of India’s most reputed companies.  

Next, as a CA, CS or cost-accountant,  you will be familiar with the commercial interest of your client owing to your past experience of working with your existing clients. In many cases, if the client trusts you, he or she is likely to volunteer information about his or her ultimate commercial objectives more easily than with a lawyer whom he is considering to engage.

CAs, CS and cost accountants are also very familiar with numbers and understand procedural aspects of regulatory work more comprehensively, which places them in an advantageous position to perform such work, because matters before regulatory authorities and  Tribunals are very technical in nature.

Further, since the respective statutes specifically authorizes other professionals such as CAs, CS and cost accountants to represent clients, there is no risk of allegations that you are illegally engaging in legal practice despite possessing a different professional degree.

Last, remember that if you can do this work, your client acquisition costs will be low, because many of your existing clients will be willing to trust you with this work (assuming they are satisfied with the regular compliance work you perform for them). You are likely to spend less time wooing your first few clients for your regulatory litigation or administrative litigation practice.

If you are a CS or an accountant, what does this opportunity represent to you? Are you interested in representing clients in these forums? Do you already do it?

Given below are excerpts from various Indian legislations which allow chartered accountants, company secretaries and cost accountants to appear before various tribunals:

Income Tax Act 1961 

When an assessee is required to appear before any authority of the income tax appellate tribunal for any proceedings, he might appear in person or through an authorised representative. –

Authorised representative,” includes

  1. Person related to the assessee
  2. Person regularly employed by the assessee
  3. Legal practitioner
  4. Chartered accountant
  5. Person who has prescribed educational qualifications as per Rule 51 of the Act
  6. Person who has qualified an accountancy exam
  7. Officer of the bank where assessee maintains a current account

In the case of an application of advance ruling by the authority, the assessee is given an opportunity to be heard either in person or through an authorised representative – Section 245R(5)

If in case an assessee is aggrieved by any order of the assessing officer, he may file an appeal to the deputy commissioner. The appellant and the assessing officer both are given an opportunity to be heard either in person or by a representative. – Section 250(2)

In case of acquisition of a property of the assessee to countervail the effect of tax evasion by him, he may be required to appear before the concerned authority or the appellate tribunal, in person or by an authorised representative – Section 269O

Customs Act 1962 

As per Section 146A of the customs act 1962, read with Rule 9 of the   Rules 1982, any person who is required to appear before the customs officer or the appellate tribunal, in connection with any proceedings, may be represented by engaging or appearing in person or by an authorised representative.

Authorised representative includes :

  1. Related person or a person regularly employed by the assessee
  2. Licensed custom house agent
  3. Legal prActitioner
  4. Any person who has prescribed educational qualifications as per Rule 9 of the custom(appeals) Rules, 1982

Rule 9 of the Custom Rules 1982 allows the following persons to represent their clients :

  1. Chartered accountant
  2. Company secretary
  3. Cost accountant
  4. A post-graduate or an Honours degree holder in Commerce or a postgraduate degree or diploma holder in Business Administration from any recognized University
  5. A person formerly employed in the Departments of Customs or Central Excise or Narcotics and has retired or resigned from such employment after having rendered service in any capacity in one or more of the said Departments for not less than ten years in the aggregate

Central Excise Act 1944 

As per Section 35Q of the Act read with Rule 232B of the Central Excise Rules, a person who is required to appear before the central excise officer or the appellate tribunal may appear through an authorised representative, such as:

  1. Chartered accountant
  2. Company secretary
  3. Cost accountant
  4. A post-graduate or an Honours degree holder in Commerce or a postgraduate degree or diploma holder in Business Administration from any recognized University
  5. A person formerly employed in the Departments of Customs or Central Excise or Narcotics and has retired or resigned from such employment after having rendered service in any capacity in one or more of the said Departments for not less than ten years in the aggregate

Central Goods And Services Act 2017 

Section 116 of CGST allows the “authorised representative” to appear before the officer, appellate authority or appellate tribunal on behalf of any person in regard to any proceedings under the CGST Act.

Authorized representative includes :

  1. Related person or a person regularly employed by the assessee
  2. An advocate
  3. Chartered accountant
  4. Company secretary
  5. Cost accountant
  6. Any person who has been authorised to Act as a goods and services tax practitioner on behalf of the concerned registered person.
  7. A a retired officer of the Commercial Tax Department of any State Government or Union territory or of the Board who, during his service under the Government, had worked in a post not below the rank than that of a Group-B Gazetted officer for a period of not less than two years

Such authorized representative can also represent the assessee in hearings for advance rulings as per Section 98(4) of the CGST Act.

Companies Act 2013 

Section 432 of the Act allows any person who is a party to any proceedings before the or an appeal before the appellate tribunal to represented by

  1. One or more chartered accountant
  2. company secretaries
  3. cost accountants
  4. legal practitioners
  5. any other person

In the case of winding up of a company by the tribunal, if a company liquidator is of the opinion that a fraud or misrepresentation has been committed by any person in promotion, formation, business or conduct of the affairs of the company since its formation, the tribunal may direct such person to be examined. The person such ordered may choose his

  1. chartered accountants or
  2. company secretaries or
  3. cost accountants or
  4. legal prActitioners

To appear before the tribunal on his behalf.

NCLT Rules 2016 

As per Rule 23,  Every petition, application, caveat, interlocutory application, documents, and the appeal must be filed in triplicate to the tribunal by appellant, applicant, defendant or respondent, in person or by an authorised representative.

For this purpose “authorised representative” is the same as the authorised representative under section 432 of the Companies Act, 2013.

The authorised representative can only make an appearance through the filing of vakalatnama or Memorandum of Appearance in Form No.NCLT 12 representing the respective parties to the proceedings. – Rule 45

However, there is a restriction of the appearance of interns, employed by any of the authorised representatives, before the tribunal. The authorised representative can file a petition or application to the registrar in form no. NCLT 10 for the intern to be able to make an appearance.

Competition Act 2002 

Section 35 of the Act allows a complainant or defendant or director general to appear before the commission either in person or he may appoint any of the following persons to present his case before the commission.

  1. chartered accountants
  2. company secretaries,
  3. cost accountants
  4. legal prActitioners  
  5. any of his officers

In the case of appeal to the appellate tribunal

  1. A person may appear in person or authorise one or more chartered accountants or company secretaries or cost accountants or legal practitioners or any of its officers to present his or its case
  2. The Central Government or a State Government or a local authority may authorise one or more chartered accountants or company secretaries or cost accountants or legal   or any of its officers to Act as presenting officers to present the case before the tribunal
  3. The commission may appoint one or more chartered accountants or company secretaries or cost accountants or legal practitioners or any of its officers to Act as presenting officers to present the case before the tribunal

Securities and Exchange Board of India Act 1992 

Section 15V of the Act allows an appellant to present his case before the securities appellate tribunal either in person or he may appoint either of the following to present his case

  1. Chartered accountant
  2. Company secretaries
  3. Cost accountant
  4. Legal prActitioner

In case of holding an inquiry against a person for the following

  1. Failure to furnish information
  2. failure by any person to enter into an agreement with clients
  3. for failure to redress investors‘ grievances
  4. defaults in case of mutual funds
  5. failure to observe Rules and regulations by an asset management company
  6. default in case of stock brokers
  7. insider trading
  8. fraudulent and unfair trade prActices
  9. contravention where no separate penalty has been provided

The adjudicating officer may issue a notice for the appearance of the person either in person or by his lawyer or by his authorised representative – Rule 4(3) of the SECURITIES AND EXCHANGE BOARD OF INDIA (PROCEDURE FOR HOLDING INQUIRY AND IMPOSING PENALTIES BY ADJUDICATING OFFICER) RuleS, 1995

Securities contract (Regulation) Act 1956

When a registered stock exchange refuses to list of securities of a company, the company may within the specified time, file an appeal to the securities appellate tribunal.

Section 22C of the Act allows an appellant to appeal his case before the securities appellate tribunal either in person or he may appoint either of the following to present his case

  1. Chartered accountant
  2. Company secretaries
  3. Cost accountant
  4. Legal practitioner

Telecom Regulatory Authority of India Act 1991

In case of a dispute between

  1. Licensor and licensee
  2. Two or more service providers
  3. Between a group of service providers and a group of consumers

The appeal lies to the appellate tribunal established under Section 14 of the Act.

The application for settlement of disputes or appeals is made under Section 14A of the Act.

As per Section 17 of the Act, The applicant or appellant has to appear before the tribunal to present his case either in person or he may authorise any of the following to present the case

  1. Chartered accountant
  2. Company secretaries
  3. Cost accountant
  4. Legal practitioner
  5. Or any of his officers

Special Economic Zone Act 2005

In case of cancellation of letter of approval to entrepreneur, the aggrieved person may make an appeal to the board under Section 16(4) of the SEZ Act

Rule 61 of SEZ Rules 2006 gives the right to the appellant to appear before the board either in person or through any of the following

  1. Chartered accountant
  2. Company secretaries
  3. Cost accountant
  4. Legal practitioner
  5. Or any of his officers

The Electricity Regulatory Commissions Act, 1998

One of The objectives of the central and state advisory committee formulated under the electricity regulations commission Act 1988 is to advise the commission on protection of consumer interest

The State Commission shall authorise any person as it deems fit to represent the interests of the consumers in all the proceedings before it. – Section 26 0f The Electricity Regulatory Commissions Act, 1998

Rule 23 of the Central Electricity Regulatory Commission (Conduct of Business) Regulations, 1999 allows a person to appoint an advocate or any professional in a statutory body to represent him before the commission.

A member of a Statutory body means a practicing Chartered Accountant,  Company Secretary or Cost and Works Accountant. – Central Electricity Regulatory Commission vide Notification No.8/(1)/99/CERC dated 27.8.1999

Foreign Exchange Management Act 1999 

In the case of adjudication when a person is alleged to have committed contravention of Rules, regulations, notifications, directions or orders issued by the rbi, the adjudicating authority may hold an inquiry against such person.

Under Section 16 of the Act, The person is given an opportunity to be heard. He has to appear before the adjudicating authority either in person or he may take the assistance of a legal practitioner or a chartered accountant of his choice for presenting his case.

When an appeal is filed by an aggrieved by a person before the appellate tribunal, he has to appear before the appellate tribunal or Special Director (Appeals) either in person or take the assistance of

  1. legal practitioner or
  2. Chartered accountant of his choice

In case of an appeal by the central government before the appellate tribunal or the special director (appeals), the central government may authorize

  1. One or more legal practitioners
  2. Chartered accountant
  3. Any of its officers to act as presenting officers to present the case.

The Airports Economic Regulatory Authority of India Act, 2008

Section 30 of the Act allows an appellant to appeal his case before the securities appellate tribunal either in person or he may appoint either of the following to present his case

  1. Chartered accountant
  2. Company secretaries
  3. Cost accountant
  4. Legal practitioner
  5. Or any of its officers

For those of you who are interested in learning the skills, here is a quick roadmap.

Goal 1: Learn how the client’s business works, what he or she is willing to pay for the most so that you can work on adding value there. Acquire new skills to add further value.

Some Chartered Accountants and Company Secretaries provide services around form-filing and compliance in connection with laws other than tax laws and corporate laws. One example of such service is to provide a certificate to an investee entity which is securing investment under the Foreign Exchange Management Act, 1999 which shows the manner of arriving at the price of securities.  

Some CAs function as registered valuers, registered with the Insolvency and Bankruptcy Board of India.

You will learn this in our diplomas on Entrepreneurship Administration and Business Laws, M&A and Institutional Finance, or Corporate Governance and SEBI Regulations.

Goal 2: Learn how to prepare advisory opinions on these matters for clients so that they do not fall into unexpected regulatory mishaps

Goal 3: Learn how to review and draft contracts so that your advice is actually factored into big-ticket  transactions and deals (which are highly subject to scrutiny) (refer to the contract drafting diploma course to identify how to get started)

Goal 4: Learn how to draft legal arguments, responses and legal drafts if your client receives is a show-cause notice or an adverse order.  

Goal 5: Argue before authorities at various regulatory forums

(You can pursue more than one goal simultaneously. For working on Goals 4 and 5 effectively, you will need to know how to read, analyze and interpret law and various notifications not just from the perspective of a regular compliance, but you will need to really dissect and split it apart to make an argument that saves your client from the consequences of an adverse order. You will also need to learn about basic principles of evidence for record-keeping, procedures for trial and regulatory proceedings and appellate procedures. Take a look at our litigation library  to see how you can learn these principles.)

It may not be wise to work on all the areas listed in the table simultaneously, so you can choose 2 or 3 at a time and start working on them.

Which areas will you now start working on? What is your new strategy going to be?

Write back to us at abhyuday@ipleaders.in or call us on +011-4084-5203 for further inputs and guidance.  

 

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