Senior Audit Assistant

An individual has sales of Rs 50 lakhs. He incurrs a loss. Is he liable for tax audit. Assume that he doesn't have any other income.
 
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Tax Consultant

yes...... tax audit is compulsory in your case
 
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Senior Audit Assistant

[(e) carrying on the business shall, if the provisions of sub-section (4) ofsection 44AD are applicable in his case and his income exceeds the maximum amount which is not chargeable to income-tax in any previous year,]
 
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Senior Audit Assistant

How do you think that subsection 4 of section 44AD is applicable to him?
 
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maximum amount which is not chargeable to tax is applicable in case of individual assessee only
 
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Senior Audit Assistant

In my opinion tax audit is not applicable. does anyone agree?

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Tax Consultant

ofcourse he is liable, business income must be shown at minimum 8% of sales or else audit is compulsory to be done. i.e. either in 44ad or ada or normal provision too audit is compulsory to be done.
 
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soleproprietorship

Yes. Tax audit is necessary because 8 of his turnover is in taxable limit. If this amount was below taxable income audit not necessary. That is my opinion.
 
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soleproprietorship

Sorry read as 8 percent of his turnover is above taxable limit. If it was below taxable limit then tax audit not necessary. My opinion
 
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PROPRIETOR - P M RAJA AND CO (TAX CONSULTANTS - AUDITORS)

Yes. I agreed to You Mr. Suresh Pau.,
Not required Tax Audit...
 
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