Proper books of account

This query is : Resolved

Satvir Singh (Querist)
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08 October 2009 A person has income from sole proprietor business (milk dairy), in the range of 3 lac to 3.5 lakh.

The business has turnover of less than 30 lakh and doesnot maintain books of accounts.

Is the firm liable to maintain proper accounts?

I have also heard about a provision that if a firm has turnover under 40 lakh, profit can simply be taken as 5% of turnover. Please explain??

CA SANJAY MUKHERJEE

CA SANJAY MUKHERJEE (Expert)
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08 October 2009 Sec 44AF is applicable in case of retail business and if you copmute profit at least @ 5 % of the Gross receipts and if turnover is below 40 lacs, the assessee need not maintain accounts under sec 44AA and need not get the accounts audited under section 44AB.

So conditions are
1) Must be in retail trade in any goods or merchandise.
2) having Turnover below 40 Lacs
3) Calculate profit @ 5% or more of gross receipts/turnover.

Satvir Singh

Satvir Singh (Querist)
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08 October 2009 thanks, sir

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