44Ad Presumptive Scheme

It depends on the tax audit/turnover status of the preceding FY.

An individual is exempted from deducting TDS under section 194A, if tax audit was not applicable during the F.Y. immediately preceding the F.Y. in which income is paid/credited. Proviso to sec. 194A (1).

Provided that an individual or a Hindu undivided family, whose total sales, gross receipts or turnover from the business or profession carried on by him exceed the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such interest is credited or paid, shall be liable to deduct income-tax under this section.

Though tax audit by virtue of sec. 44AD is carried out under clause (e) of sec. 44AB, but the proviso to sec. 194A(1) makes reference to clause (a) and (b) of sec. 44AB.

So, if in the preceding FY, the assessee turnover was above 1 crore, then deduct TDS, else not.

Even if in the preceding FY the assessee showed => 8% profit and turnover was above > 1 crore =< 2 crore and tax audit was not applicable, TDS should be deducted becasue proviso to sec. 194A(1) makes reference to turnover in clause (a) and (b) of sec. 44AB which is 1 crore and 50 lakh respectively.