U/s 44AA

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AMIT KUMAR (Querist)
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03 January 2011 I have turnover of Rs. less than 10 lacs in business and filed a return by showing income from this business Rs. 1.5 lacs i.e. more than Rs. 1.2 lacs. MY BUSINESS DOES NOT RELATE TO PRESUMPTIVE INCOME i.e. SECTION 44AD, AF, AE.
1. What will be the position under section 44AA whereas I was not liable to file return u/s 139(1)?
2. What an AO can do against me?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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03 January 2011 Considering your nature of business if the profits shown by you is reasonable AO may accept your return as it is.

In case of small traders presumptive methods of Income are prevalent which are based on turnover or gross receipts, and in such cases no books of account are required to be maintained.

You may explain your position in this regard on the basis of Section 44AF. As profit shown by you in the return are not lower than the limits prescribed, you need not to worry at all.

It is to be made clear that even if you are not liable to file the return still provisions of Section 44AA can be applied.

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CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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DR GAURAV GUPTA FCA, FCS, LL.B

DR GAURAV GUPTA FCA, FCS, LL.B (Expert)
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03 January 2011 you have to maintain books of a/c as provisions of sec44AA applied irrespective u are earning taxable profit or not if u are earning more than 1,20,000 the 44aa is applied

AMIT KUMAR

AMIT KUMAR (Querist)
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04 January 2011 Paras Bafna Sir,

My business is not related to presumptive income. Section 44 AD, AE, AF does not apply on me. Then what will be consequenses?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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04 January 2011 If you really like to be penalised, A O can do so. U/s 271A he may levy penalty upon you
of Rs 25000/- in case of failure to keep, maintain or retain books of account, documents etc as required by Section 44AA.

Further, if you really do not want to be penalised, please write whether this is the first return of a newly started business or an existing business for which in the preceding years, you have filed returns.
Please mention the Turnover and income of last 3 years.

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