25 September 2011
One of my client proprietor of firm engaged in business of developing and building of commercial / residential complexes, 2010-2011 is his first previous year. he has purchased the plot started construction on it, till 31/03/2011 the project was in progress i.e incomplete.he follows project completion method for revenue recognition. he invested his funds , quasi loans and booking amounts from prospective buyers, total exceeded to more than 100 lacs. advise whether provisions of tax audit are applicable. and what are ICAI guidelines / SAP provisions in this regard. thanks.
As per Sec. 44AB of Income Tax Act, Tax Audit is mandatory, if Total Income Exceeds Rs. 60 Lakh in previous year. Revenue should be appeared on the face of Profit and Loss A/c.
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