There was an Assessee who is filing returns from last 3years into business of running TT to carry passengers(employees of companies )and receive money for services given (Though business is run for more than 15 years now). Gross income has been around 500000 and net income less than 250000(has always been higher than 8%). Had not opted for presumptive and regular books were not maintained.W
hile filing return BS and p&l were not given rather another option of showing gross receipts not required to maintain books were opted.
in 2018-19, around 7,00,000 is gross and net is 328000....further in march 2019 he has got into poultry business in his son's name one TT is also sold. Parallelly he wants to come out of TT business also.
Question is as per 44AA for 2019-2020 books have to be maintained if 328000 is shown in 18-19? further for 18-19 should BS , P&L be prepared?
44AA maintenance of books of accounts
Replies (3)
"Question is as per 44AA for 2019-2020 books have to be maintained if 328000 is shown in 18-19?"
Yes, as per sec. 44AA(2) incase of individual, if income exceede Rs. 2.50 L, maintenance of books of accounts become mandatory.
"Further for 18-19 should BS , P&L be prepared?"
Yes, once books are maintained, there comes the result.
Yes u need to maintain books of account and prepare b/s if u are not opting for 44ad or 44ada.
1. I don’t see any provision prescribing preparation of Balance sheet and PL account with respect to sec 44AA. The only condition prescribed u/s 44AA is to maintain proper books of account in case of Individual if the income exceeds Rs. 2.5 lakhs during the year.
2. And proper books of accounts does not mean BS and PL. It includes ledgers, Cash books, details of debtors and creditors, etc.
3. With respect to ITR, it is better to show the accurate financial position of the proprietorship for avoiding any mishap in the future.
4. Though provision has not prescribed, it is better to prepare the same and show in the relevant column in ITR.
Please correct me if the above solution has an alternative view.
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