166.            ABC Ltd is engaged in providing the taxable services and has been filing its tax returns regularly. However its jurisdictional Commissioner has reasons to believe that ABC Ltd has not correctly computed the value of its taxable services for the previous year. Can the jurisdictional Commissioner direct such person to get his account audited by a chartered accountant to the extent and for the period as may be specified by him. Discuss. Will your answer be different if ABC Ltd contend that its account for the previous year has been audited under the Income Tax Act, 1961?

Section 66 provides that if the proper officer not below rank of Assistant Commissioner, with the approval of Commissioner has reasons to believe that any person liable to pay tax has failed to declare or determine value of taxable service correctly, he may direct such person to get his records audited by a chartered accountant or cost accountant nominated by Commissioner and submit duly signed and certified audit report within 90 days to the Assistant Commissioner.

Thus, jurisdictional Commissioner can direct to get his accounts audited by a charted accountant nominated by him. Further section 66(3) provides that commissioner is empowered to direct a special audit even if the accounts of such person have been audited under any other law for the time being in force. So contention of ABC Ltd that its accounts for the previous year had been audited under the Income Tax Act, 1961 can not be accepted and it will have to comply with the order of the jurisdictional Commissioners to get its accounts audited.