CA.R.S.KALRA
Quick Summary
Let us first of all see what section 69C of the Income Tax Act, 1961 reads. Section 69C reads as under 69C. Where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof, or the explanation, if any, offere
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FAQ :
Section 69C states that if an assessee incurs expenditure without a satisfactory explanation for its source, the amount can be deemed as the assessee's income for that financial year.
No, if an assessee opts for presumptive taxation, they cannot claim any deduction for expenditure, including depreciation.
No, because no deductions are allowed under presumptive taxation, the Assessing Officer is not permitted to add back income as unexplained expenditure.
'Deemed income' means that for tax purposes, a certain amount is considered income, even if it's not the actual profit earned. For example, under Section 44AD, 8% of turnover is deemed income.
Generally, if an assessee opts for presumptive taxation and declares income at the prescribed rate (e.g., 8% of turnover), they are not obligated to maintain detailed books of account or get them audited, unless they wish to declare income below that rate.
No, if the income is estimated at a presumptive rate, the expenditure component cannot be considered 'actually' incurred for the purpose of applying Section 69C. The purpose of presumptive taxation is to simplify assessments for certain businesses.
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