06 December 2016
Mr "A" is a whole sale dealer. His turnover during the year is 50 lakhs. He Would declare 8% profit on turnover U/s 44 AD and his profit would be 400000/-. However his actual profit is 30% i.e. 15 Lakhs which are accumulated in this bank account. What would be the consequences of this. Can Mr. "A" Invest this 15 lakhs in purchasing an Asset. let us take there is no depreciation. On what profit should he pay tax. on 400000 or 15 lakhs.
CAclubindia
