Tax audit applicable

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NK1976

NK1976 (Querist)

28 May 2017 Dear Expert,
I want to know that tax audit applicability in following :
1) The company is Nbfc
2) Income is 1.10 Crore including 92 Lacs dividend on shares & MF and profit on Sales of MF - 18 lacs.
3)No other income
4) Form 61A applicable or not to company.

Please advise me in above case Tax Audit applicable or not.

Thanks

CA Mohit Kumar

CA Mohit Kumar (Expert)

29 May 2017 tax audit is required when turnover cross 2 crore in FY 16-17 ..but in your case it is below the limit hence, not applicable..

Studentsca

Studentsca (Expert)

29 May 2017 Tax audit Is applicable For Turnover being above 1 CR if you are not oppting for sec 44 AD, since the income you have earned is not taxable like Dividend. No Audit is applicable.

Message likes : 1 times

NK1976

NK1976 (Querist)

29 May 2017 Form 61A applicable or not to company.
Is SFT Required to be Filled for Nil Transaction

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

26 July 2025 Here’s a clear breakdown for your query:

### Tax Audit Applicability:

* For **NBFC (Non-Banking Financial Company)** or any company, tax audit under **Section 44AB** is applicable if **turnover/gross receipts exceed Rs. 1 crore (for FY 2016-17)**.
* However, dividend income is **exempt and not considered as business turnover** for tax audit purpose.
* Profit on sale of mutual funds (business income) is considered, but total turnover from such business activities should exceed Rs. 1 crore for audit to be mandatory.

**In your case:**

* Income includes Rs. 92 lakhs dividend (exempt for audit) + Rs. 18 lakhs profit on sales (business income).
* Total relevant turnover = Rs. 18 lakhs only (less than 1 crore), so **tax audit is NOT applicable**.

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### Form 61A (SFT - Statement of Financial Transactions):

* Applicable if specified transactions exceed thresholds (like purchase/sale of shares, mutual funds, etc.).
* Dividend income itself **does not attract Form 61A** reporting.
* Sale of mutual funds may attract SFT if amount exceeds Rs. 10 lakhs in aggregate in a year.
* Even if there are no transactions, **nil filing** may or may not be required depending on income tax department instructions. Usually, **if no specified transactions, nil statement may be filed or can be left** as per latest instructions.

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