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Democratisation vs dilution
June, 23rd 2007
Preparing and releasing into the market people with a smattering of knowledge of a subject, besides being dangerous also tantamounts to devaluing a profession established by law.

That there are not many takers for the services of Tax Return Practitioners (TRP) may be disappointing to the Government which launched the scheme last year with a lot of fanfare and expectations but not surprising to the cognoscenti. But then the Government has only to blame itself for this poor TRP rating.

Income-tax in India, it is acknowledged on all hands, is a complicated law and many of its provisions defy comprehension of even the dyed-in-the-wool chartered accountants and adjudicating authorities, as evidenced by the cacophony of interpretations given by them on a given issue.

A failure from the start

In the event, the Government's long-standing dream of enabling taxpayers file their returns themselves has largely remained unfulfilled. The nostrum it has proposed in this regard TRP was doomed to failure right from the start. How can people be expected to entrust their critical tax affairs to those yet to hone their skills, especially when there are chartered accountants galore, not belonging to the ivy-league, willing to help file returns for a small fee?

The moral of the story is: Simplify the law and procedure if you want to have a do-it-yourself dispensation. Foisting an upstart if not a simpleton is a simplistic solution to a problem.

Much the same, one is afraid, is being witnessed on the investment front. The certified financial planners trained by the Financial Planning Standards Board of India (FPSB) may not have many takers much less inspire confidence given the availability of more formidable and better qualified and equipped professionals such as CAs, CFAs and MBAs in the business.

Misplaced hope

The SEBI pinning its hopes on FPSB to rein in hype and hoopla in the investment world is a trifle misplaced given the fact that those trained by it admittedly constitute a minuscule minority in the world of investment, donning the robes of or passing off as advisors assuming for a while that they are going to be imbued with all the necessarily financial skills and wizardry via a crash course.

Democratisation is fine, but not if there is a lurking fear of dilution in quality of the services. If democratisation were pursued for the sake of democratisation, the Government would be guilty of licensing and unleashing quacks on clients. Didn't someone say half knowledge is more dangerous than ignorance?

In this connection, it would not be entirely inappropriate to point out a faux pas (discernible to the cognoscenti alone!) in the movie Sivaji that is holding cine-goers in a thrall these days a CBI officer is heard naming a crime as having been committed under FERA, whereas the truth is the law has long ago been replaced by FEMA.

Devaluing the profession

Preparing and releasing into the market people with a smattering of knowledge of a subject besides being dangerous also tantamounts to devaluing a profession established by law. It is for this reason that quacks are frowned upon and decried by the Medical Council of India as indeed by the entire qualified medical fraternity.

It is, therefore, ironic then to find quacks being licensed and unleashed into other disciplines. One hopes the Government does not believe that quacks are dangerous only when they administer medicines. They are equally dangerous when they proffer and peddle half-baked advice on matters accounting and finance.

S. Murlidharan
(The author is a Delhi-based chartered accountant.)

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