44ad and 44ab applicability

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CA Vandana Rathi (Querist)
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29 July 2016 My Client(Firm) has Other Sources income of Rs. 7,00,000 /- and loss from non-continuing business of Rs. 5,00,000/-.
Is tax audit applicable as business is not being carried on but certain legal expenses, bank interest have to be claimed?
Please suggest any case laws if any.

Amol S Joglekar

Amol S Joglekar (Expert)
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29 July 2016 what is the turnover? if it is above 1 crore, then tax audit is applicable.

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CA Vandana Rathi

CA Vandana Rathi (Querist)
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29 July 2016 Turnover is NIL(as there is no business activity during the year).

Further can interest earned on FD be shown as business income as ultimately such FD was created from business funds only?

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2016 turnover is NIL...so no tax audit....
creating FD out of business fund is not the KEY.....if FD was for trade of business is the key....(just tell me whether FD was shown under INVESTMENT or CURRENT ASSET.

CA Vandana Rathi

CA Vandana Rathi (Querist)
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01 August 2016 FD is shown as investment in books

Amol S Joglekar

Amol S Joglekar (Expert)
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01 August 2016 it is income from other sources.

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