Is tax audit compulsory in the following cases

case (1) a Proprietory concern is having turnover of rs.50 lakhs in P.Y- 2011-12 (A.Y. 2012-13) and net profit of rs. 4.5 lakh.....now if he/she shows rs. 4.5 lakh being higher then 8% of rs. 50 lakhs ( i.e- rs.4 lakh)  in his/her Income Tax Return.......will it attract sec.-44AB .....and is tax audit required in such a case........???

case (2) if profit is rs. 3.8 lakh and profit shown in I.T Return is rs. 4 lakh (8% of rs. 50 lakhs being higher then rs. 3.8 lakh) ....is Tax Audit Compulsory in such a case.....

In both cases books of A/c's are maintained .......

Replies (2)

Hi,

We can answer your query as follows, 

Tax Audit limit for the A.Y. 2012-13 is Rs. 60 Lakhs or above so,

(1) Now if Assessee is showing higher profit which is more than presumptitive taxation rate i.e. 8% then in that case S/he doesn't not required TAX AUDIT.

(2)Now, in second case if Assessee is showing less profit then the rate of presumptive taxation i.e. 3.8 Lakhs which is less then 8% then S/he required to Get Audited His/Her accounts from CHARTERED ACCOUNTANT. i.e. It attracts Tax Audit.

Regards,

Abhi

Yes..... i agree with Abhi...........

i am adding another point on this matter......

If assesse showing net profit 1.5 lacs which is lower than basic exemption limit.....

now he required to get audited u/s 44ad  ?

in my opinion he is not required to get audited......that is main crux of this sec.which is given in explanation 2 of sec 44ad.

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