in our case a professional having professional income of 11 lakhs carried on futures & dervative business. his turn over from derivative business exceeds 3 crores & incurred a loss of 17 lakh from futures business. whether he is eligible for tax audit or not? His professional income below limit of 15 lakhs . its very urgent please help me
29 July 2012
1) Professional income need not be audited u/s 44AB. 2) If the "absolute value of profit and loss" (no need to consider turnover or profit alone) of futures and derivative business exceed Rs. 60 lakhs that account has to be audited u/s 44AB.
29 July 2012
Turnover for the purpose of derivative business means difference in sale & purchase price of derivatives.
Eg. if a contract was purchase for Rs. 1 Lakh and sold for 1.2 Lakh, turnover will be Rs. 20000 only. Also if another contract was purchased for Rs. 1 Lakh and sold for Rs. 80000, then turnover of this transaction will also be Rs. 20000 only. So total turnover of these two transactions will be Rs. 40000.
You have to sum up both the differences (positive and negative) to arrive at the figure of total turnover.
So recompute the figure of turnover and check if it exceeds Rs. 60 lakhs, then he shall be liable for audit.
29 July 2012
Now let us assume his FNO absolute value is 17L. So on both the parameters he is not liable for tax audit. (Filethe return before 31/07/2012)
CAclubindia
