sim car & recharge cards distributor can avail u.s 44ad

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Querist : Anonymous

Querist : Anonymous (Querist)

18 July 2011 sir

local taluk area distributors can avail u/s 44ad declared his profit and claim refund.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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19 July 2011
Gross Receipts vis-a-vis ITR 4S?

What is his Gross Receipts ?

Whether mobile SIM card and "Talk Time" sold by him ?

That may be treated as Gross Receipts and he is not in a position to show profit at the rate of 8% on it.

To my mind, it may create some problem for him.

.

Safer way-
ITR-4
The other way is to file the Return in ITR 4 on the basis of commission received by him.
If he shows reasonable profit, say 50-60% of commission received by him and file his return in ITR 4,
I think there will be no problem to him.
He should prepare P&L a/c and Balance sheet as well and do not opt for Presumptive Method in this case.

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The Safest Option:
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In any case he should get his accounts audited and file his return

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Let's have experts' opinion on interpretation of Gross Turnover or Receipts in this case and the better method to be adopted.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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19 July 2011 Selling of SIM card is a business income and if the Turnover is below 60L and profit shown is 8% or more then you can claim 44AD benefit.

Keep in mind that if the provisions of 44AA are to be kept in mind.

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