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Sec 44ad

Nirmit Choraria (CA Final) (1333 Points)

19 October 2012

If the profit is below 8% of the gross tunover so assessee is liable to counduct audit of his books of accounts...??????

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22 Replies

vicky singh (student) (67 Points)
Replied 19 October 2012

no not at all

deepali agarwal (Company Secretary) (1289 Points)
Replied 19 October 2012

i m sorry..my mistake..If an assesse has turnover more than 60 lacs for present year and 1 crore for 2012-2013 than hes mandatorily require to get his accounts audited..n if turnover is below the above mentioned limit and profit is also below 8% then too hes required to get his accounts audited...

Pawan Mittal (CA Final) (702 Points)
Replied 19 October 2012

Dear Nirmit,

An assessee is required to get his accounts audited if he wants to declare his income below 8% of the gross turnover.

I don't agree with vicky and Deepali.

deepali agarwal (Company Secretary) (1289 Points)
Replied 19 October 2012

now m i justified mr. pawan..actually i got confused i thought its above 8%

C.A SUVAJIT SAHU (CA ( In Practice )) (708 Points)
Replied 19 October 2012

hi Nirmit.........

8% taxation rate on presumptive basis is available U/S 44AD. .

but benefit of section 44AD is not available for companies as it is available only for INDIVIDUAL, HUF & ,FIRMS.

section 44AD is not a mandatory presumptive taxation section........ but section 44AD is triggered when gross receipt of business does not exceed 60 lacs.

in that case ,if net profit is below than 8% income as ascertained US 44AD and assessee wants to go with net profit ,section 44AB(Tax audit) becomes compulsory.

THANKS,

SUVAJIT

2 Like

C.A SUVAJIT SAHU (CA ( In Practice )) (708 Points)
Replied 19 October 2012

Manjunatha M K (Manager - Accounts) (318 Points)
Replied 19 October 2012

You have 2 options. Provided your turnover is below 44AB limits:

1. Declare Actual profit (i.e.below 8%) - You have to maintain account, get it audited.

2. Declare 8% or more profit on gross turnover for Income Tax - No need to maintain Books of accounts, no question of Audit.

1 Like

harshad (CA FINAL) (251 Points)
Replied 19 October 2012

AGREE WITH PAWAN

Nirmit Choraria (CA Final) (1333 Points)
Replied 19 October 2012

Thanks every one for you views and answer..
Now what if I have profit of below 8% but i dont get my books of account audited and just file my return what can be the consequnces faced...????