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Ketan t Upadhyay (Querist)
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27 December 2011 total turn over 4017500 net profit 341111 incl display income 206000 is reqd. to get accounts audited ? u/s. 44ad ??

my point is that net profit of Rs. 341111/- include display income rs. 206000/- assessee is retail trader looking to this profit down below 8% is audit required by law or not

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Guest (Expert)

29 December 2011 Special provision for computing profits and gains of business of civil construction, etc.

44AD. (1) Notwithstanding anything to the contrary contained in sections 28 to 43C, in the case of an assessee engaged in the business of civil construction or supply of labour for civil construction, a sum equal to eight per cent of the gross receipts paid or payable to the assessee in the previous year on account of such business or, as the case may be, a sum higher than the aforesaid sum as declared by the assessee in his return of income, shall be deemed to be the profits and gains of such business chargeable to tax under the head “Profits and gains of business or profession”:

Further, 68[(6) Notwithstanding anything contained in the foregoing provisions of this section, an assessee may claim lower profits and gains than the profits and gains specified in sub-section (1), if he keeps and maintains such books of account and other documents as required under sub-section (2) of section 44AA and gets his accounts audited and furnishes a report of such audit as required under section 44AB.]

Going by the above IT provisions, Section 44AD applies only to the above specified Companies. However, Tax Audit is compulsory since the turnover exceeds Rs. 40 lakhs.

FCA Prashant Chavan

CA. Krishna K Neeraj

CA. Krishna K Neeraj (Expert)
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29 December 2011 W.e.f. 01/04/2011, Section 44AD is applicable in case of any business except the business of plying, hiring......as refereed u/s 44AE
AND
WHOSE GROSS TUROVER/RECEIPTS in the previous year does not exceed 60 lacs

Presumptive income is 8%.

you can opt for 44AD and can declare 8% or more income.

no need for tax audit

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Guest

Guest (Expert)

29 December 2011 29th December, 2011

Dear Krishna,

Thanks for the update.

I am a Fellow Member in the profession; and I do not advocate the practice of declaring 8% of income to any of my clientele.

Regards,

FCA Prashant Chavan