44ada 44ad section provisions questions
Friends,
Kindly provide your valuable suggestion on below question
Initially Transactions are not deposits and become later on or fall in Deposit definition then what compliance need to made and how auditor should deal in Audit Report.
Example- Advances received from customers are not deposits till 364 days but fall in Deposit thereafter then how company will comply and steps need to taken. Further How Statutory Auditor should deal the same.
deposit later become transaction
1. What will be place of supply in case of Books in Hard Copies delivered to place outside India & address in records exits and Payment to be receive in INR through him or relative in India ? Also, whether same will be consider as export of goods in term of taking anything being movable outside India.
Further, Can same can be presented in Balance Sheet as Export of Goods ?
What will in case Books sent via Email in soft copies ?
2. What will be place of supply in case of Online Tution/coaching provide to student siting outside India & address in records exits and payment received in INR through his account or his relative in India. Whether
Further, Can same can be presented in Balance Sheet as Export of Services ?
1. Whether TDS would be applicable for payment of Leased Line Internet Charges Paid to Vodafone/Idea etc at what rate and which section.
2. Whether TDS would applicable on payment to Vodafone for Monthly Rental of VOIP/SIP Trunking Services/Telecommunication charges paid. What rate and section will apply.
applicability
Need you valuable suggestions and guidance.
Fact are as follows
ACIT has pass order under for exemption of Rs 600000 and Nil demand under Section 143(3) for for AY 2017-18 of Trust which is registered u/s 10(25) of the Act.
As per income & expenditure for the year as follows
Gross receipt Rs 1250000
Expenditure Rs 650000
Net Income Rs 600000
In return assessee fill exemption of Rs 1250000 (Gross) instead of Rs 600000 (net) for the year.
During proceedings, request made for making adjustments for clerical mistake apparent from material record.
Also submitted ITAT Delhi order in the matter of ICAI vs CPC banglor, where ITAT said for making prima facie adjustments apparent from records.
However, AO passed order of correct exemption of Rs 600000 and pass at Nil income and tax.
Further, initiated penalty of 270A for under reporting of Income in consequences of mis reporting.
1. Whether this case is of under reporting of Income
2. If yes then how taxes shall be computed and penalties.
Hello Ekta Pandey ji, you have written very nicely and much elaborating manner. I have a doubt regarding clause of Order 2016 in 3 (iii) and 3(iv). Whether Loan to Directors u/s 185 or loan & investment u/s 186 is required to be covered under clause 3(iii) "Whether the company has granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013. If so, whether the terms and conditions of the grant of such loans are not prejudicial to the company’s interest" or not. Whether contracts or arrangement constitute loan & advance u/s 188 or u/s 184(2) or only covers operational transaction like sale, purchase, leasing as specified u/s 188 only.
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Dear Pankaj Ji,
Thanks for putting your valuable query here for in-depth analysis.
(1) As you said above, only Deduction of Expenses u/s 30 to 38 is deemed to be allowed for the purpose of Income Computed as per Section 44AD/44ADA. My view is Salary (Read as Remuneration) and Interest paid to Partner is allowed since it is in the nature of Appropriation of Profit and Taxable in the hands of Partners. Also, ITR-4 allows the same to be claimed by a partnership firm opting for Presumptive Taxation.
(2) The assessee has to show his intention for claiming the benefit of Presumptive Taxation, since if the assessee file Return under Normal Provision then Section 44AA gets applied (Assessee needs to maintain Books of Accounts subject to limit prescribed). Whatever expenses Assessee claims in ITR, he needs to keep/maintain Bills and Vouchers for the same. So, Assessee needs to file ITR-4 only to claim benefit under Presumptive Taxation (Deeming provision as you said won't apply).
(3) If a Partnership Firm opts for Presumptive Taxation Scheme and declares profit, at 8% or 6% as applicable, then even though it's profit gets short from 8% / 6% due to claiming Salary and Interest to Partners, it will still be in compliance of Section 44AD/44ADA since apportionment of Salary and Interest is done after complying with Section 44AD/44ADA (Refer ITR-4 available at Efiling Portal) and hence No Audit is required.
(4) In the case of an Assessee having Income for LIC or Other Commission, In my view, there is No any Specified Rate under Normal Provisions of Income Tax. The Assessee should declare Normal/Actual Profit and he is not required to get his Accounts Audited u/s 44AB even though he declares lower profit or even loss in his ITR if his Turnover in the PY is upto Rs.1 Crore (But he is required to maintain Books of Accounts as specified in Section 44AA so that AO will be able to verify the particulars declared in ITR at the time of Processing of Return of Income).
(5) In my view, the Profession mentioned in Section 44AA(1) is applicable only when such Profession is carried on by a Person in his/her Professional Capacity. A Company/LLP can not work in a Professional Capacity (unless the Bar Council, Medical Association, ICAI, Engineer's Association specifically provides Certificate to carry such Profession by a Company/LLP).
So only those professionals, who are eligible to practice as per ICAI, are covered here. Further, only those works which are allowed by the Governing Body of any profession (Here ICAI) should be covered here. It means any work which is out of the scope (not related to the profession directly) should be excluded from here.