Income tax issue

The provisions determining applicability of Tax Audit are as under:

Section 44AB. "Audit of accounts of certain persons carrying on business or profession”.
Every person, --
(a) carrying on business shall, if his total sales, turnover or gross receipts, as the case may be, in business exceed or exceeds one crore rupees* in any previous year;

- get his accounts of such previous year audited by an accountant before the specified date and furnish by that date the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed.

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Hence the term ‘turnover’ for the purposes of this clause may be interpreted to mean the aggregate amount for which sales are effected or services rendered by an enterprise, ie., the total sales effected during the year. (Trade Discount can be reduced from such turnover figure)

The profit or suplus made out of the dairy business is not the relevant criteria to test the applicability. Tax Audit becomes mandatory only when your Turnover or Sales exceeds Rs. 1 Crore.

In your scenario, it seems Tax Audit shall be required as the Sales made have gone well above Rs. 1 Crore.

Please refer to Guidance Note on Tax Audit from the ICAI for detailed clarification on this issue.

Hope this clarifies the issue.

Hi,

Your accounts need to be audited.

As per your query ,ur sales exceeds rs.1cr. . U need to get ur accounts audited. No matter what your income is.

yes ur accounts need to be audited. no matter how much u show Profit.