PricewaterhouseCoopers gets Supreme Court notice over alleged irregularities

The Supreme Court has agreed to hear a petition that demands an investigation into the functioning of UK-based multinational accounting firm PricewaterhouseCoopers (PwC) Pvt Ltd and its network audit firms in India.

The public interest litigation or PIL, filed by an NGO called Centre for Public Interest Litigation (CPIL), has alleged that PwC and the affiliated firms, which provide audit, tax and advisory services, "are apparently indulging in activities in violation of various statutes and polices, like evasion of income tax, violations of Foreign Direct Investment (FDI) policy, RBI guideline, Foreign Exchange Management Act (FEMA) and other rules..."

A Supreme Court bench headed by Chief Justice P Sathasivam said issues raised in the PIL need "examination" and has issued notice to the Centre, the Reserve Bank of India (RBI), the Central Board of Direct Taxes (CBDT), the Institute of Chartered Accountants of India (ICAI), PwC and audit firms that share its brand name.

The NGO has pleaded that the alleged violations have been in public domain for more than one year, yet "relevant authorities" have failed to investigate these.

In its petition, CPIL has said that payments worth hundreds of crore of rupees, by way of subsidies, export incentives, grants, etc, are done based on certification of auditors and, "it is, therefore, imperative their certification is absolutely correct and sacrosanct as otherwise it would cause humongous loss to public exchequer."

Apart from a probe into the functioning of these firms, the PIL has also sought "directions to lay down guidelines and bring systematic changes in order to check these kinds of accounting scams".