I have a small confusion regarding the maintenance of accounts for a person who has opted sec.44AD for filing return.
As per Sec.44AD, if no books of accounts are maintained, doesn't have proper bill, voucher, then the assessee can opt for Se.44AD and pay tax on presumtive basis.
My query is, whether such assessee can prepare his Profit & Loss A/c as well as Balance Sheet?
The assessee is a sole proprietor who deals with readymade garments having a small store (We can say he is a hawker), and his all sales and purchases are made in cash. So, it is impossible for him keep record of each and every sale and purchase. That's why he opted for Sec.44AD for the purpose of filing IT Return.
Now, if he wants to obtain any type of business loan from any bank, they will ask for P&L A/c, Balance Sheet as well as ITR acknowledgement. So, my question is, whether P&L A/c, Balance Sheet can be prepared on estimate basis (as actual record is not available)?
Whether this question can be raised later that where P&L A/c has been prepared then why did he opt for Sec.44AD ?
CAclubindia
