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ITR QUERY - AUDIT REQUIREMENT

17 July 2022

if assessee has salary income + Intraday Equity Loss + F&O Loss in this case prepared ITR-3 Considering F&O as Business but there is loss (i.e. Profit less than 8% of Turnover) F&O turnover is 6,00,000

there is error on IT Portal while uploading ITR-3 that there is possible error of Applicability of Audit u/s. 44AB/44AD(E).

Kindly suggest whether Audit is Compulsory?

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9 Replies

CA Dhruva Kalamanji (Chartered Accountant ) (1996 Points)
Replied 17 July 2022

Dear kenil

yes audit is required in case of intraday loss and fno loss.

you can contact me at sthayin @ gmail for audit related services

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Kenil Rana (13 Points)
Replied 17 July 2022

Thanks CA DHRUVA KALAMANJI for the reply.

but if I show 6% profit of F&O Turnover under Presumptive scheme after this do I need to get Audited?

CA Dhruva Kalamanji (Chartered Accountant ) (1996 Points)
Replied 17 July 2022

No need of audit.

but you can not carry forward the loss.

so instead you get the audit done and carry the loss, which you can adjust in future against profit

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178099 Points)
Replied 17 July 2022

Unless you had opted for presumptive assessment u/s. 44AD, in any preceding 5 years, in your case audit is not mandatory. Though the utility may prompt for audit but as per act it is not necessary.

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Kenil Rana (13 Points)
Replied 17 July 2022

Thanks Mr. Dhirajlal for your response.

yes, i hadn't opted for 44AD

if i will upload the ITR without audit then do i need to pay any penalty or tax & what will be the worst case

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (178099 Points)
Replied 17 July 2022

No worst or bad case, you can file it without any fear.

The 6/8% minimum profit u/s. 44AD was amended in the act.

As on today when you have not opted for sec. 44AD in earlier 5 years, you are not required to file tax audit report when turnover is below 1 Cr & profit margin be anything, let there be loss; and let your taxable income be more than basic exemption limit.

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