Audit under section 44ab.

This query is : Resolved 

24 May 2012

Under Section 44AB of the Income Tax Act, how is the gross turnover/receipts calculated in the case of a commission agent?

Please look into the following two aspects.

1. Is an audit u/s 44AB mandatory only if the commission exceeds Rs. 60 lakhs.

2. Assuming a selling commission agent earns a commission of 2%, and the sales effected by him are Rs. 60 lakhs, and his commission income on it turns to be Rs. 1.2 lakhs, is he liable for tax-adit u/s 44AB given his turnover/sales exceeds Rs. 60 lakhs?

Regards & Thanks,

shashikumar (Expert)
24 May 2012

Dear Hasan,

Tax audit under 44AB is mandatory for all two aspects mentioned by you above.But
F/Y 2012-13 the ceiling limit for 44AB is 1 Crore

Thank You

CA CS Amit S. Kedia (Expert)
24 May 2012

Dear Hasan,
Tax Audit is applicable only in first case.
Commission income is to be looked at and not the gross sale effected by him.

CA. Vinod (Expert)
24 May 2012

Turnover effected by him is not his turnover in second case, no tax audit is required.

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