44ad vs. tax audit

Explanation.—For the purposes of this section,—

          (a)  “eligible assessee” means,—

       (i)  an individual, Hindu undivided family or a partnership firm, who is a resident, but not a limited liability partnership firm as defined under clause (n) of sub-section (1) of section 2 of the Limited Liability Partnership Act, 2008 (6 of 2009) ^27a ; and

      (ii)  who has not claimed deduction under any of the sections 10A, 10AA, 10B, 10BA or deduction under any provisions of Chapter VIA under the heading “C. - Deductions in respect of certain incomes” in the relevant assessment year;

          (b)  “eligible business” means,—

       (i)  any business except the business of plying, hiring or leasing goods carriages referred to in section 44AE; and

      (ii)  whose total turnover or gross receipts in the previous year does not exceed an amount of  ²⁸ [sixty lakh rupees].]

Dear Ravi,

Answer to your 1st Question is , YES your client falls under Section 44AD.

Answer to your 2nd Question is as under:-

If the Profit is more than 8% then , he does not require to get his accounts audited and pay tax on gross turnover * 8% = income.

If the profit is less than 8% of turnover (gross) , then your client needs to get his accounts audited u/s 44AB r.w.s. 44AD.

I hope your question is answered.