Piyush Mohta (Credit ) (41 Points)
09 July 2009Section 44AB Reads - Every person
a) Carrying on business shall, if his total sales, turnover or gross reciepts, as the case may be,in business exceed or exceeds forty lakhs rupees in any previous year.
Now for example if in financial year 2005-06 44AB is applicable to a firm , then in 2006-07 will it be applicable even though in 2006-07 turnover is less than 40Lakhs. Because, Section says in any previous year. Please clarify ..
RAJU
(LEARNER)
(1089 Points)
Replied 09 July 2009
Hi Piyush
It is not earlier year, it is previous year. Previous year has been defined in IT Act. It is the period during which the assessee earns income which will be assessed to tax in the assessment year. Hence, Sec 44AB is applicable only if it exceeds Rs.40 lakhs (Business) during the previous year.
CA LOVELY ARORA
(C.A. B.Com (H) Graduate)
(2151 Points)
Replied 09 July 2009
yes, mr. dharamraju is correct. It is not earlier years, it is previous years, OK, if you leave previous from it, then what will remain :- any year. It has the meaning of that only.
CA Shailesh +91 9393926464
(Chartered Accountant)
(2088 Points)
Replied 09 July 2009
Yes.
If Turnover exceeds 40lacs ---- Audit
Turnover does not exceeds 40 lacs ----- No audit
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