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Maintenance of book of account of vegetable shopkeeper

CS Alok Mishra (Income Tax Practitioner) (786 Points)

10 June 2012

Hello everybody,

I have a client who sells vegetables in retail and his sales approx per year is around 10 lakhs. now question arises that he is fulfiling conditions of section 44AA (i.e. maintenance of Accounts) but practically its not possible for a sabjiwala to maintain accounts or inventory details. now how to show his income?? he cant keep books of accounts...

Suggest me friends, if you have been with such type of situation or have any idea regarding that.

Thanks & regards

Alok

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8 Replies

Deepak Parsai (Future CA) (623 Points)
Replied 11 June 2012

In my opinion, in that case he should opt Pressumptive tax scheme u/s 44AD.

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NiTiN JAiN (TAX CONSULTANT & CA FINAL STUDENT) (155 Points)
Replied 11 June 2012

Yes you should apply sec 44 AD & show a profit minimum @ 8 % on sales

1 Like

NiTiN JAiN (TAX CONSULTANT & CA FINAL STUDENT) (155 Points)
Replied 11 June 2012

Yes you should show the profit u/s 44AD @ 8% minimum on th sales.

1 Like

Varuna (CA Student) (102 Points)
Replied 11 June 2012

Agreed with Deepak and Nitin

1 Like

CA PARAS BAFNA (Practising CA ) (33428 Points)
Replied 11 June 2012

In case regular Books of Accounts are not possible to maintain, he can be advised to record his daily Sales & Purchases.

If he gets purchase vouchers/bills from the Wholesale Market , tell him to compile all those datewise. Even Slips on Plain Piece of Papers can help manytimes. DO NOT RELIEVE THE CLIENT FROM THE BURDEN, ULTIMATELY THAT ONLY WILL BE HELPFUL TO BOTH HIM AND THE CONSULTANT.

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CS Alok Mishra (Income Tax Practitioner) (786 Points)
Replied 24 June 2012

Thanks to all of you.

But if i will apply section 44AD then i have to pay 8% and as you all can understand that client is a vegetable shop owner, he will never prefer to pay tax. Apart from this expenses will also not be allowed.