gd aftrnun frndz...
plz cn nybdy clarify d dbt regarding applicability of sec 44ad/ae/af and 44aa,
sec 44aa(2) sayz if income exceeds rs 120000 or gros recpts exceeds rs 10 lacs person reqired to maintain books of accnts nd sec 44ad/ae/af sayz concept of persumtive incmz and need nt 2 maintain buks, hence the que is if a person files return under 44ad/ae/af nd the prsumptive incm exceedsa rs 120000 then is dt prsn requrd 2 maintain buks?
thnku in advance....:)
Rectify me if I am wrong..
Regards,
Siddharth bumb
sidbumbhelp @ gmail.com
Section 44AD is applicable to construction companies and the income calculation is on presumptive method i.e., 8% etc
and remaining part I am agreeing with mr siddharth.
| Originally posted by : S Gupta | ||
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Section 44AD is applicable to construction companies and the income calculation is on presumptive method i.e., 8% etc and remaining part I am agreeing with mr siddharth. |
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not for construction companies.... according to my knowledge there should not be company
yes you are right i mean construction organisations ie., PF etc
Sec 44 AD is applicable to eligible business
"eligible business" means,—
(i) any business except the business of plying, hiring or leasing goods carriages referred to in Sec 44AE and
(ii) whose total turnover or gross receipts in the previous year does not exceed an amount of Rs. 60 Lacs (A.Y. 2012-13)
| Originally posted by : Rahul Nagpal | ||
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Sec 44 AD is applicable to eligible business "eligible business" means,— (i) any business except the business of plying, hiring or leasing goods carriages referred to in Sec 44AE and (ii) whose total turnover or gross receipts in the previous year does not exceed an amount of Rs. 60 Lacs (A.Y. 2012-13) |
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gdmrng.. n ys i agree with u al bt my que is if dt prsmtive incm, whthr it is 44ad or ae or af, exceeds rs. 1,20,000/- is it required to maintain buks or not? i mean are these 2 diffrnt provisions are sepreate or to be read 2gthr..???
Sub-section (1) of sections 44AD and 44AE clearly provide that the income shall be estimated at the prescribed percentage/basis without regard to the provisions contained in sections 28 to 43C of the Act. In other words, the income estimated in accordance with sections 44AD and 44AE takes care of various deductions, etc., admissible under the aforesaid sections.
maintining books is said by sec.44aa(2),.. which falls between section 28 to 43C hence sec 44AD and 44AE shall have overriding effect and need not maintain books even if exceeds 120000/-
ok thanku so mch:)
Hey Mansha,
I would like to inform you that you are mixing two provisions and got confused ,
Section 44AA of The Income Tax Act,1961 talks about the eligibility for maintaining books of accounts (i.e. if business/profession income exceeds Rs 1,20,000 in previous year or Rs 10,00,000 in any one of the three years immediately preceding the previous year)
while Section 44AD(5) of The Income Tax Act,1961 specifies that " Notwithstanding anything contained in the foregoing provisions of this section, an eligible assessee who cliams that his profits and gains from the eligible business are lower than the profits and gains specified in sub - section(1) and whose total income exceeds the maximum amount which is not chargeable to income - tax, shall be required to keep and maintain such books of account and other documents as required under sub - section (2) of section 44AA and get them audited und furnish a report of such audit as required under section 44AB."
So in order to decide whether books are to be maintained for assessee filing return under section 44AD, you have to check whether his income crossess the maximum amount not chargeable to tax or not. That means if his Profit as per PROFIT & LOSS A/C is lower than 8% of gross turnover and though his total income exceeds the maximum amount not chargeable to tax , then in such case he is required to maintain books under section 44AA and get them audited u/s 44AB.
under sec 44 ad the person requires to maintain the books only if the estimated income claimed ny the assessee is less than 8% of gross tunover.provisons of sec.44 aa is not applied on presumptive income.
agree with Mr. sanjeev
sec 44 AD and AE are overriding sections .. no need to maintain book unless assesse feels that his income is less than 8% of gross receipts . In such a case he will not opt for such a scheme so has to maintain books ..
CAclubindia
