Section 44 ad

This query is : Resolved

Ravi Mittal (Querist)
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12 November 2013 THE DETAILS OF THE INCOME OF AN INDIVIDUAL ARE AS UNDER:-

1. INCOME FROM SALARY IS Rs.96000.

2. INCOME FROM OTHER SOURCES IS Rs. 31000.

3. THE TURNOVER OF BUSINESS IS Rs. 17 LAKH AND THE PROFIT IS Rs.72800 i.e THE PROFIT IS 4.28% OF TURNOVER.

HE HAD MAINTAIN BOOKS OF ACCOUNTS

I THINK IN THE EVENT WHEN THE PROFIT IS BELOW THE TAXABLE INCOME AND THE TURNOVER IS ALSO BELOW Rs. 1 CRORE,THERE IS NO NEED TO GET BOOKS OF ACCOUNTS AUDITED AND IN THE ABOVE CASE HE CAN SUMBIT HIS INCOME TAX RETURN WITH SHOWING THE BUSINESS PROFIT OF Rs. 72800 WITHOUT AUDIT REPORT. EVEN THOUGH THE BUSINESS INCOME IS BEING BELOW 8% UNDER SECTION 44AD.

PLEASE TELL ME AM I RIGHT OR NOT?

IN THE ABOVE CASE, IF IN THE EVENT, WHEN HIS INCOME FROM OTHER SOURCES IS Rs.38000 IN PLACE OF Rs.31000 AND HE HAD DEPOSITED Rs.8000 IN PPF ACCOUNT.

THEN WHEATHER HE IS LIABLE TO GET HIS ACCOUNTS AUDITED UNDER SECTION 44AD?

BECAUSE IN THE NEW CIRCUMSTANCES HIS TOTAL INCOME EXCEEDS EXEMPTION LIMIT, BEFORE GIVING EFFECT TO THE PROVISION OF SECTION 10A AND CHAPTER VIA.

EVEN THOUGH HIS TOTAL INCOME DOESN'T EXCEED THE MAXIMUM AMOUNT CHARGABLE TO TAX AFTER DEDUCTION UNDER SECTION 80C.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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12 November 2013 1. In case 1, he is not required to get the audit done.

2. In case 2, he shall have to get the audit done. this is so because the audit is triggered where the total income exceeds the maximum exempt income limit and total income is computed before the claim of deduction under chapter VI.

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