06 August 2011
My turnover of business is Rs. 58,00,000/- net of VAT for FY 10-11 and VAT on above is Rs. 2,32,000/- @ 4% . M i liable for tax audit U/s 44AB of Income Tax Act 1960?
06 August 2011
Turn over is not defined for the purpose of section 44AB. Therefore, the method of accounting regulrly employed, in the instant case, is the deciding factor. Accordingly, if VAT Collected is separately accounted and VAT payment is also debited in that account, then turnover for the purpose of section 44AB is Rs. 58/- lakhs only. This is as per ICAI guidelines. In view of that and the NP is more than 8% audit under section 44AB does not apply.
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