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Sec. 44AF

SSG (1936 Points)

23 February 2010

Whether the benefit of Sec. 44AF can be availed by the assesses doing following work :- tailoring, automobile repair and spare parts, studio works.

How the gross receipts from the business can be calculated, when no books has been prescribed for assesses having receipts receipts below Rs. 10 lacs. Will it be based just on estimates of the assessee.

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4 Replies

Amir (Learner) (4016 Points)
Replied 23 February 2010

Dear SSG,

Sec 44AF has been merged with Sec 44AD & the threshold limit is 40 lacs

Further,the benefit of presumptive taxation which was earlier available ONLY to the business of "Civil Construction" & "Retail Trading" has now been extented to BUSINESS OF ANY KIND (except plying of trucs for which separate sec 44AE is there).....

Plz appreciate that this facility is not available in case of PROFESSION ....

Now u have specified following works -

a) Tailoring = Dress desiginig w.r.t film making is considered as Profession, so benefit of presumptive taxation is not available

b) Automobile repair and spare parts = It is a Business & hence benefit of presumptive taxation is available

c) Studio works = I think it will be classified as Business, but I m not sure.......

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Ameet (L) (1678 Points)
Replied 23 February 2010

Section 44AF is appliable upto A.Y. 2010-11 only.

Can claim if,

1) Individual, HUF, AOP, BOI, Firm, Company, Co-Operative Society, any other person

2) Engaged in the business of retail trade in any goods or merchandise.

3) T/o does not excees 40 Lacs

Section 44AD introduced from A.Y. 2011-12,

Can Claim if,

1)Individual, HUF, or firm (not limited liab firm)

2)Enaggeed in Business except the business of plying hiring or leasing goods carriage

3)T/o does not excees 40 Lacs

FIRST OF ALL JUST DECIDE THE NATURE WHETHER BUSINESS OR PROFESSION AND MAKE APPLICABLE ACCORDINGLY.

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SSG (1936 Points)
Replied 23 February 2010

Thanks, Mr. Amir and Mr. Ameet.

But Ameet, thats what my ques. is. Whether Talioring, Automobile Repair and Spare Parts and Studio worsks can be classified as retail business. There are a lot of such activities, which are doubtful regarding to their nature.

Now I am filing IT returns for AY 2009-10 for assesses, who are carrying out such activities. So I am in doubt whether benefit of Sec. 44AA and Sec. 44AF can be taken.