Section 44ad.

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

20 July 2013 An eligible assessee who claims that his profits and gains from the eligible business are lower than the profits and gains specified in sub-section (1) and whose total income exceeds the maximum amount which is not chargeable to income-tax, shall be required to keep and maintain such books of account and other documents as required under sub-section (2) of section 44AA and get them audited and furnish a report of such audit as required under section 44AB.

◊This subsection talks of two cumulative conditions for applicability of 44AA and 44AB: -
i. The Income from eligible business is lower than 8% of Turnover or Gross Receipts,
AND
ii. The “TOTAL INCOME” exceeds the maximum amount not chargeable to tax.

If (ii) condi. not fulfilled then 44aa & 44ab not appli. and assessee will not have to pay tax.
What is total income includes
-only business income OR
-income from all sources after deduction??????

Ashish Kukreja

Ashish Kukreja (Expert)
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20 July 2013 Total income includes income from all sources and arrived after claiming deductions under chapter VI-A..

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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20 July 2013 Agree with the expert.
.
Before the condition (ii) the connective used is "and" it has become the topic of every discussion held on Section 44AD.
.
So, your inference is right but the intention of law makers was some what different.
.

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