Dear Experts,
One of the assessee individual carries on the business and files ITR 3 (For AY 2017-18) filling the Balance sheet and Profit and Loss Account details. Let us say, the assessee shows sale of goods as Rs. 24,00,000. However as it was assessee's first year of business, there of a net loss of Rs. 2,00,000 as computed in accordane with the provision of Section 28 to 43B.
My question is that, whether the assessee if required to have its books of accounts audited under setion 44AB or not?
As per my view, the assessee doesnot require any tax audit to be done even though the assesse has incurred the loss because tax audit under section 44AB is applicable only in cases where the gross receipts exceeds Rs. 1 Crore. Tax Audit would have to be done only if the assessee instead of filing return of income in Form ITR 3 would have opted to pay on presumptive basis in Form ITR 4 (as applicable for AY 2017-18) and would have shown income below Rs. 2,00,000 (i.e 24,00,000 x 8%).
Thanks and Regards,
Dhrunil Bhatt
CAclubindia
