I am in delima in deciding what to do in case of a assessee whose turnover is abt. 20 Lacs & asked me to do Tax Audit U/s 44AB.
On verification of the books of accounts it is found that number of times cash purchase was done above Rs 20,000 thereby resulting in contravention of Sec. 40A(3).
My query is that: "is it possible that i conduct the tax audit u/s 44AB mentioning the details of Sec. 40A(3)contravention in 3CD report AND FILE THE IT RETURN UNDER PRESUMPTIVE TAXATION SCHEME U/S 44AD so that contravention of 40A(3) would not be applicable to him"
The purpose the client wish to get accounts audited is to get bank loan as bankers asking him for audit report.
Please suggest is it possible to do or suggest some other alternate solution.....
Very thanks in advance for solving the delima.....
22 September 2011
No the matter stated by you can not be done once you audit the account and file return in relation with the same than it can not availed benefit of presumptive taxation.
Better you audit the accounts and make necessary adjustments to reduce such contravention or nullify the same.
CAclubindia
