Section 44ada

As per the exact wordings of the act (sec 44ADA), it applies only to the professions coverd u/s. 44AA.  And hence some professionals are of the view that the section is not applicable to any other professions.

Some professionals are of the view that the intention to introduce the section is to reduce the administrative cost over small professionals (like traders as per sec 44AD) and is not just restricted to the specified ones. Till any clarification issued by CBDT the dillema is bound to exist.

As per sec. 2(36) of IT act “Profession” is defined as Vocation, or a job requiring  some thought, skill and special knowledge or  profession refers to those activities where the livelihood is earned by the persons through their intellectual or manual skill. ((Addl CIT vs. Ram Kripal Tripathi (1980) 125 ITR 408 (All).

Secondly, expecting more than 50% profit margin in any activity is beyond reality. And if any assessee is ready to declare that and pay legitimate tax over the same, department should be ready to accept.

As per my earlier similar posts, I am of the view that any such professions, though not specified u/s. 44AA, requiring specific qualifications and intellectual skill would be included  as 'professionals' as per section 44ADA.

For more views refer: /forum/definition-of-profession--53358.asp