V.Pasupathi, Erode

SECTION 44 AB
Section 44 AB was introduced in Finance Act 1984, presented by Hon’ble Finance Minister,sri.Pranab Mukherjee. Business turnovers of Rs.40 lakhs and above and professional receipts of Rs.10 lakhs and above are required to be audited by a chartered accountant. By insertion of this section power was conferred on chartered accountants to do tax audit.Audited accounts did not enjoy any statutory concessions either in assessment or at survey / searches by Incometax Department. Courts interpreted section 44AB holding that,” The Object of section 44AB of I.T.Act is to prevent tax evasion, plug loopholes enabling tax avoidance and unearth blackmoney”. In re Thanavur silk handloom weavers co.op production and sales society Ltd. [ 2003(263) ITR.Page334)] The rare judgement of High Court of Uttarkhand , [2008(300)ITR P.435] has viewed that the plenary powers of the assessing officer are not conditioned by an audit report.
History repeats!!! The recent finance bill seeks to raise this limit to Rs.60 lakhs for business and Rs.15 lakhs for professionals. Prices and costs of services have spiraled up many times since 1984.The proposed raise in limits seems to be inadequate and only cosmetic.The limits may be raised to 1 crore for business and Rs.25 lakhs for professionals.

v.pasupathi
advocate,
25,periyar street,
erode 638 001
phone: 0424-2212707