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Discussion > Income Tax > Tax queries >

TAX AUDIT SECTION 44AB

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ACA, B.COM

[ Scorecard : 7797]
Posted On 12 August 2010 at 16:37 Report Abuse

 

X is a sole proprietor. F.y 09-10= Turnover 45 lakh F.y 08-09= Turnover 39 Lakh F.y 07-08= Turnover 50 lakh He has paid a royalty of Rs 35,000/- to a company on march 25, 2009 without deducted TDS.
Question is
 Tax audit u/s 44AB is applicable in this case in FY 2009-10  & Disallowance U/s 40(a)(ia) is applicable in the case or not?
 
 

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Aditya Maheshwari
CA in Practice

[ Scorecard : 34828]
Posted On 12 August 2010 at 17:11

TDS provisions in case of an individual is applicable if the individual is liable for audit u/s 44AB in the previous year. In the given case the assessee is not liable for audit u/s 44AB in F. Y. 2008 - 09 and hence TDS provisions are not applicable in F. Y. 2009 - 10. Hence exepense not disallwoable u/s 44AB.





CMA. CS. Sanjay Gupta
"PROUD TO BE AN INDIAN"

[ Scorecard : 76250]
Posted On 12 August 2010 at 17:25

Agree with Aditya Ji. Disallowance Not applicable since tax audit is not applicable in Fy 2008-09.




CA. BIJENDER KR. BANSAL
ACA, B.COM

[ Scorecard : 7797]
Posted On 12 August 2010 at 17:39

Tax audit will be applicable in FY 2008-09 becasue in last previous year 2007-08 turnover is more than 40 lacs.

Tax audit will not be applicable in FY 2009-10 even if its turnover exceeds Rs. 40 lac because previous year 2008-09 turnover is below 40 lacs.

Whether i am right sir ?????????????




Aditya Maheshwari
CA in Practice

[ Scorecard : 34828]
Posted On 12 August 2010 at 18:25

For tax audit u/s 44AB the turnover of the year is to be seen and if turnover for the financial year exceeds Rs. 40 lakhs that year is liable for audit not the next year.

Previous year tax audit applicability is to be seen only in case of applicability of liability to deduct TDS and not for tax audit.

SO ur second post is wrong.




Member (Account Deleted)
ALWAYS READY TO LEARN NEW THINGS

[ Scorecard : 10481]
Posted On 12 August 2010 at 19:30

Originally posted by : Aditya Maheshwari

TDS provisions in case of an individual is applicable if the individual is liable for audit u/s 44AB in the previous year. In the given case the assessee is not liable for audit u/s 44AB in F. Y. 2008 - 09 and hence TDS provisions are not applicable in F. Y. 2009 - 10. Hence exepense not disallwoable u/s 44AB.



Bhavin Bhadra
Job

[ Scorecard : 165]
Posted On 12 August 2010 at 20:59

Dear all,

 

For tax audit applicability limit of Rs. 40Lakh turnover is to be considered so Tax audit will be applicable in the F.Y. 2007-08 and F.Y. 2009-10.

 

TDS Provisions in case of propreitor are applicable only if there is tax audit or last year tax audit had been applicable. Therefore, in this case Royalty payment of Rs. 35000/- will be subject to TDS provisions.




ajithasai
m.ajitha

[ Scorecard : 95]
Posted On 13 August 2010 at 09:13

hi

TDS provisions in case of an individual is applicable if the individual is liable for audit u/s 44AB in the previous year

thank you

regards,

phe9oxis,






CA SURENDRA KUMAR RAKHECHA
Practising CA at Surat

[ Scorecard : 25318]
Posted On 13 August 2010 at 11:02

Agree with CA Aditya's reply.




DHARMENDRA JHA
Sr. Executive Finance

[ Scorecard : 98]
Posted On 13 August 2010 at 11:43

Agree with Aditya Sir.



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