IS 44AB AUDIT APPLICABLE?

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Dintakurthi Tirumala (CA FINAL) (15989 Points)
Replied 28 August 2010

Hai divya no doubt it comes under proffessional sec 44AB clarifies doctors, actors,lawyers are proffessionals. so the firm must be liabile to audit u/s44AB and they should be require to maintain books as per sec 44AA

OM SAI SRI SAI JAI JAI SAI

CA BIREN SHAH (employee) (467 Points)
Replied 28 August 2010

it is profession. and SEC 44AB is applicable. They are liable for TAX AUDIT under sec 44AB.

Dharmendra Jha (Asst. Manager Finance) (100 Points)
Replied 28 August 2010

Pankaj sir is write

Viraj (Financial Analyst) (26 Points)
Replied 28 August 2010

I too agree with Mr. Pankaj Gulati's opinion. By running a hospital, the profession is taken over by business. In case of hospital their profession will become one of the several business activities being run in the hospital. Clearly 44AB in this case shall not be applicable.

Subhash (Articled Assistant) (27 Points)
Replied 31 August 2010

i also agree wid d rest.. it is a profession ..

Kamal Jain (FCA) (200 Points)
Replied 31 August 2010

To tide over the confusion whether running a hospital is a business activity or profession, you can refer to the Commissioner of Income Tax (CIT) v K K Shah case. Here, it was held if the doctors are running nursing homes (polyclinics) for treating their own patients, the income from the nursing home must be treated as their professional income. But if the nursing home runs a drug store for selling drugs to patients or others, admits patients and charges fees such as room fees, this can be considered to a business activity and that part of the income is business income.Tks.

1 Like

(Guest)

agree with rohit sir

Kamlesh Kumar Gupta (C.A.) (18 Points)
Replied 18 September 2010

Hello

Please let me know whether the corporate agent of any insurance agency is covered under profession category and the audit u/s 44AB will be applicable for receipts over 10 lacs.

K K GUPTA

Dinesh Kumar Agarwal (Article clerk) (117 Points)
Replied 18 September 2010

I agree with Mr. Pankaj Gulati.

Hiren Bhandari (CA Practise) (93 Points)
Replied 21 November 2012

I have a question if 3 person form a partnership firm and made a hospital. They hire doctors and other staff on salary basis. This hospital provide all types of service like rooms, wards, laboratry testing, opd, consultancy etc etc. Is this firm comes under business or profession.

Shruti Aggarwal (Partner) (22 Points)
Replied 17 September 2014

As per the case of Shalini Hospitals vs Asstt. Cit on 26 May, 2006, as attached, the activity of a hospital will be considered as business and not profession.

Attached File : 618840 1366056 shalini hospitals vs asstt cit on 26 may 2006.pdf downloaded: 143 times