Turnover plus VAT Whether tax exceeds Rs 60 lakh is tax audit compulsory ?

 Turnover plus VAT Whether tax exceeds Rs 60 lakh is tax audit compulsory ?

1. The tax audit u/s 44AB is compulsory for the FY 2011 -12 if the Sales, turnover or Gross receipts from business exceeds Rs. 60 Lacs (Rs. 15 Lacs for assessee engaged in the Profession). The term "Sales Turnover or Gross Receipts" are not defined under the Income Tax Act-1961. However, as per the Guidance Note on Tax Audit issued by ICAI. where VAT/ excise duty are separately accounted for and not included in the sales A/c.  then turnover would  not  include the value of VAT/Excise duty so separately accounted for. However, if the VAT/Excise Duty are included in the sales A/c itself then no adjustment for the same could be done in the figure of sales to assess the amount of turnover for the purpose of section 44AB. In your specific case, the VAT is accounted by you separately & hence the same would not be includible in the calculation of Turnover. Hence, audit would not be mandatory if the turnover (excluding VAT) is less than Rs. 60 Lacs provided further that Income offered is more than 8% of the turnover amount. If the income to be offered for taxation is less than 8% of the amount of turnover, then the audit would be mandatory by virtue of section 44AD of the Income Tax Act-1961.

2. If any member of the HUF transfer his own assets to HUF without con-sideration (i.e.. throw his assets to the common hotchpotch), income from such assets would be taxable in the hands of individual transferring the assets and not in the hands of HUF [Section 64(2)]. So. if die amount is gifted by you to your HUF. the income thereon would be clubbed with your income only.

3. Our readers may further note that gift received by HUF from any person oihejMhanjncjiiber_is taxable if the amount of gift exceeds Rs. 50.000/-