26 December 2008
Clarification required for One of my Clients
My Client is doing business of General Commission Agents. His Gross Receipts during the financial year 07-08 is Rs.2.50 lakhs and Net Profit is Rs.1.00 lakhs. During the year he purchased a Car in the month of June 2007 for Rs.2.00 lakhs and used fully for business.
Gross Receipts 250000.00 Less: Overhead Expenses: Administrative Expenses 120000.00 and Depreciation on Car 30000.00 Nett profit 100000.00
Under these circumstances books of Accounts will not be required to maintain u/s 44A of the IT Act 1962, since the Gross Receipts is less than Rs.10.00 lakhs and the Profit is also less than Rs.1.20 lakhs.
Can he claim depreciation on Car of Rs.30000/- since the business without books of accounts.
Determination of Taxable Income of Rs.1.00 lakhs by the assessee is after Depreciation Rs.30000/-, whether it is correct or not.
CAclubindia
