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44AD INCOME TAC ACT

This query is : Resolved 
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(Querist)
12 September 2025 A partnership firm having a turnover of 40 lacs. but their net profit is less than 7 % of turnover after deducting remuneration & interest on capital to partners, 97 % turnover is in cash.
My query is whether it is subject to audit u/s 44AD for A.Y. 2025-26?
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
12 September 2025 Whether sec. 44AD was opted in any of earlier five years?
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Rajesh Topiwala

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Rajesh Topiwala (Querist)
12 September 2025 NO 44AD SINCE 5 YEARS. LAST YEAR TOO WE HAD DONE AUDIT U/S 44 AB. SALES THAN 40 LACS TURNOVER EACH YEAR. BUT LANGUAGE OF SECTION 44 AD READ WITH 44AB, CREATES CONFUSION. SOME SAYS NO AND SOME SAYS YES.
PLEASE CLARIFY
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
12 September 2025 No tax audit applicable if turnover less than 1 Cr. and sec. 44AD was not opted in any of previous FIVE years.
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Dhirajlal Rambhia

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Dhirajlal Rambhia (Expert)
19 September 2025 Good Luck...
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