Audit u/s 40ab
This query is : Resolved
27 May 2013
Every person whose Gross receipt exceeds 1 crore is to get the accounts audited as per section 40AB of IT Act.My doubt is what constitute the Gross receipts of a Bank? Since Banking means accepting deposits for the purpose of lending should the revenue expenditure be deducted from total receipt in arriving at the gross receipts for the purpose of this section.
27 May 2013
In simple words its mean "Gross Sales Turnover" and does not include Deposit or loans.
27 May 2013
for more detail read:
http://www.simpletaxindia.net/2012/02/audit-44ab-turnover-sales-gross-receipt.html
http://www.simpletaxindia.net/2012/02/audit-44ab-turnover-sales-gross-receipt.html
28 May 2013
Thank you for the response sir. I would like to know if there is any circular of CBDT or any decisions on how to compute the "gross sales turnover" or " gross receipt" of banks for the purpose of determining the liability under sec.40 AB.
29 May 2013
In case of banks and financial institutions, gross receiepts mean interest earned (gross, not the net interest) and other income like fee income, income from discounting, treasury income, etc.
29 May 2013
Thank you very much Sir. Sorry for wrong quoting of Sec.44AB as 40AB.
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