Sales for the year is Rs.51,00.000
Book profit is Rs.4,59,000 (i.e. 9% of sales)
Whether assessee can opt for presumptive taxation u/s 44 AD of I.T. Act by declaring 8% income of Rs.4,08,000 in the income tax return and paying tax on it and at the same time crediting the capital account in the books by 9% at Rs.4,59,000?
When you are offering income under presumptive basis. i.e, U/s.44AD it means you are ignoring the book result. So eventhough the book result shows 9% of the turnover, you can offer income at the rate of 8% on the turnover.
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When you are offering income under presumptive basis. i.e, U/s.44AD it means you are ignoring the book result. So eventhough the book result shows 9% of the turnover, you can offer income at the rate of 8% on the turnover. |
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AGREED....
Agreed, even though you can offer less than 8%, but you need to get your books of Account Audited.
As soon as you have opted presump scheme of sec 44AD....then Sec 44AD(2) provides that nothing contained in Sec 28 to 44 will apply(except decu of int/remuner in case of firm).....In short Sec 44AD will prevail over the normal provisions of the Act and therfore the Assessing Officer cannot go back to see wehat's the ACTUAL PROFIT...
As decided in case of DIT vs GMBH DSD(German co) in Hon"ble Delhi HC.
agree
CAclubindia
