Section 44AD

This query is : Resolved

Amit (Querist)
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21 July 2009 can somebody tell me that my gross receipt from civil construction is Rs. 35 Lacs and i have paid Rs. 5 Lac as a interest on loan taken by me and also received Rs. 1 lac on loan given by me. Can i take the presumptive income-8% of Rs. 35 Lacs
or
8% of Rs. 35+1=36Lacs

or
8% of Rs. 35 Lacs+Rs. 1Lacs as income from other source
or
Only 8% of Rs. 35 Lacs and Rs. 1Lac will be adjust from Rs. 5Lacs

Abhishek Mohta

Abhishek Mohta (Expert)
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22 July 2009 As per section 44AD if an assessee is involved in the business of civil construction etc. and has gross receipts form that business less than Rs. 40,00,000/- then the assessee can claim presumptive taxation under this section. So, presumptive taxation will apply on Rs. 35,00,000/- only.

Again Rs. 1,00,000/- will be adjusted with Rs. 5,00,000/- only and only if that loan taken was for the purpose of giving loan to someone else.

Otherwise Rs. 1,00,000/- will be taxed under the head income from other sources.