Gross receipt or gross due-which is relevant for tax(44ada)?

For professional fees, as per recent accounting standards, it is based on the gross amount accrued, which includes dues of the services provided in the same period. You may refer Form 26AS for the same.

Income computation & Disclosure Standard (ICDS)

As per  Para 2(1) of  ICDS IV- Revenue recognition {Revenue” is the gross inflow of cash, RECEIVABLES or other consideration arising in the course of the ordinary activities of a person from the sale of goods, from the rendering of services, or from the use by others of the person’s resources yielding interest, royalties or dividends}.

From the above definition it is very clear that the "Revenue" is not only the actual Cash receipt but also the amount receivable for the service rendered during the Financial Year. 

Therefore, date of receiving revenue is not relevant; only the date of rendering service is relevant for calculating the Gross Receipt for the purpose of section 44ADA. 

As such the term "Gross Receipt" has not defined under the Income Tax Act, 1961. But we have to take some base to support stand taken in computing "Gross Receipt" for the purpose of section 44ADA. 

why can that standards be be..."when you actually recieve the money"? viz the cash system

If its a buissinessman...doing buissiness in March....he may get paid only on April or maybe in May or maybe even later....shouldn't the date at which he recieves the payment be relevant then?

If I have an FD....do i pay tax on interests recieved depending on when you recieve it...or use this mercantile system?

Anyway I have till now followed the "cash system"......Last year I recieved the March 2017's professional fees on April and this amount is being included in the calculations for the financial year 2017-2018.

And please see the following sections of the IT act

________________________________________________________________________________________________________

Ok..now I have read up ICDS (notification no:87/2016)

It states:

S.O. 3079 (E) In exercise of the powers conferred by sub-section (2) of section 145 of the Income-tax Act, 1961 (43 of 1961, the Central Government hereby notifies the income computation and disclosure standards as specified in the Annexure to this notification to be followed by all assessees (other than an individual or a Hindu undivided family who is not required to get his accounts of the previous year audited in accordance with the provisions of section 44AB of the said Act) following the mercantile system of accounting, for the purposes of computation of income chargeable to income-tax under the head “Profits and gains of business or profession” or “Income from other sources"

_________________________________________________________________________________________________________

If I am not following the mercantile system till now...i think the underlined segments of the above act make it inapplicable for me...isn't it?

Guidance Note on Tax Audit under Section 44AB of the Income-tax Act, 1961. 

Refer above Guidance Note. Evething is provided therein. 

10.22 The above Accounting Standards are to be followed by all assessees following mercantile system of accounting. Therefore, it is clear that those assessees who are following cash system of accounting need not follow the Accounting Standards notified above

. _-----__----------------------------------------

That's what it says..and this too:

Once the choice of method of accounting is decided, the assessee must follow 
consistently the method of accounting employed

Its ok. Read out Guidance Note on Tax Audit under Section 44AB of the Income-tax Act, 1961.
Specially go through the page No. 21 to 23 

Ok here is the extract from it where it tries to explain gross receipts for professionals

___________________________________________________________________________________---

5.19 In the case of a professional, the expression "gross receipts" in profession would include all receipts arising from carrying on of the profession. A question may, however, arise as to whether the out of pocket expenses received by him should form part of his gross receipts for purposes of this section. Normally, in the case of solicitors, advocates or chartered accountants, such out of pocket expenses received in advance are credited in a separate client's account and utilised for making payments for stamp duties, registration fees, counsel's fees, travelling expenses etc. on behalf of the clients. These amounts, if collected separately either in advance or otherwise, should not form part of the "gross receipts". If, however, such out of pocket expenses are not specifically collected but are included/collected by way of a consolidated fee, the whole of the amount so collected shall form part of gross receipts and no adjustment should be made in respect of actual expenses paid by the professional person for and/or on behalf of his clients out of the gross fees so collected. However, the amount received by way of ...advance for which services are yet to be rendered will not form part of the receipts, as such advances are the liabilities of the assessee and cannot be treated as his receipts till the services are rendered.

______________________________________________________________________________________________________

Here again "gross receipts" are described as "receipt". The "receivable" clauses in ICDS would kick in only if the mercantile system is adopted, is what I understand.

Further...this guideline at various places (as given by me in previous replies) say that according to section 145 (1) one who derive income under the head "profits and gains of buissiness or profession" can use either the cash or mercantile system of accounting