Tax Audit Under section 44AB

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

16 December 2010 A travel agent gets a commission of Rs 12 lacs in a year on air tickets issued on behalf of various airlines. The value of tickets issued by him during the year on behalf of the airlines is more than Rs 1 crore.He collects the full ticket fare from the customers and remit to the respective airline after deducting his commission and shows only the commission in the profit and loss account.
Is he liable to get his accounts audited under section 44 AB?
Is there any clarification by the Income Tax Department or any Case laws in this regard?

Aditya Maheshwari

Aditya Maheshwari (Expert)

16 December 2010 Applicability to commission agents - If the commission agent does not sell the goods of his principal as his own and only charges commission for bringing two persons to holy marriage of sale and purchase, then he will not come within the ambit of section 44AB, except when his professional receipts exceed Rs. 10 lakhs - Abhay Kumar & Co. v. Union of India [1987] 164 ITR 148 (Raj.).

CA Ayush Agarwal

CA Ayush Agarwal (Expert)

16 December 2010 in This Case as Rightly Said by Mr. Aditya Sir If professional Receipts Exceed Rs. 15 Lacs for P.Y. 2010-11 Then Only Liable to Tax Audit U/s 44AB.

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