Applicability of tax audit

This query is : Resolved

ABHILASH KASLIWAL (Querist)
Follow

16 May 2013 Hi,

I wanted to know whether in the case stated below tax audit u/s 44 AB is mandatory or not ??

Mr. X has a trading business with turnover of 50 lakhs. He maintains proper books of a/c. Mr. X wants to file his return of income in ITR-4 form (not in ITR-4S i.e. he is not opting for sec 44AD). He wants to show his Net Profit at 3 Lakhs (which is less than 8% of the turnover). Is Mr. X required to get his books of account audited ??

CA Vikas Acharya

CA Vikas Acharya (Expert)
Follow

16 May 2013 yes as per 44AD even if you are not opting for the same, fi profit in business is less than 8% , audit is required.

ABHILASH KASLIWAL

ABHILASH KASLIWAL (Querist)
Follow

16 May 2013 ok
but then why is ITR-4 Available for the above trader, he will obviously go for ITR-4S when audit has to be done

CA Vikas Acharya

CA Vikas Acharya (Expert)
Follow

16 May 2013 audit will not be done if wants to show the profit more than 8% and is maintaining books as 44AD is optional.
but for ease of govt and assessee itr 4s is available.
though itr 4 useful in many other cases, like
where audit is mandatory due to exceeding limit of audit - 1crore/25laksh, itr-4 is for them.
who are professionals, commission agents. etc

Message likes : 1 times