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2016 (1) TMI 1201 - AT - Income TaxEligibility to claim benefit u/s 44AD - turnover limit exceeded - Held that:- The assessee has submitted its total turnover for AY 2010-11 is ₹ 46,88,000/-, which was confirmed before the CIT(A) and estimated the gross profit at 5% on the turnover. We find that the eligibility of computation of income, for the AY 2010-11 on the presumptive basis u/s 44AD, the turnover limit was ₹ 40 lakhs, whereas, in the present case, the assessee crossed the limit of ₹ 40 lakhs, hence, the assessee is not eligible to compute his income as per section 44AD to claim benefit in that section. Moreover, the rate applicable on the presumptive basis is 8% whereas the assessee has declared the profit at 5% of turnover. Assessee has claimed that he has taken ₹ 5 lakhs loan from his late brother’s family and he has not substantiated the above claim by way of any documentary evidence as he has not disclosed even in the receipts and payments account submitted before the AO. Since the assessee has crossed the turnover of ₹ 40 lakhs, he is not eligible to claim benefit u/s 44AD as per the provisions of this section. As the assessee has not substantiated the loans and advances received from his customers and his late brother’s family and also he is not eligible to claim the benefit u/s 44AD, in our considered view, respectfully following the decision of the coordinate bench in case of Suresh Kumar Biyani (2015 (9) TMI 1501 - ITAT HYDERABAD), we direct the AO to calculate the gross income of the assessee at 20% of the total turnover as accepted by the assessee before the CIT(A). - Decided partly in favour of revenue
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