voluntary audit of llp, Income Tax

[satbir singhwahi]

The accounts of every LLP shall be audited in accordance with Rule 24 of LLP, Rules 2009.

Such rules, inter-alia, provides that any LLP, whose turnover does not exceed, in any financial year, forty lakh rupees, or whose contribution does not exceed twenty five lakh rupees, is not required to get its accounts audited. However, if the partners of such limited liability partnership decide to get the accounts of such LLP audited, the accounts shall be audited only in accordance with such rule.

The llp was audited voluntary though in the financial year, turnover does not exceed forty lakh rupees, or contribution does not exceed twenty five lakh rupees .

Now if the ITR for A.Y. 2019-2020 is filed on 09.10.2019 within extended date for audited ITR 31.10.2019. Whether LLP audited voluntary will be covered by clause (a) of Explanation 2 to subsection (1) of section 139 of the Income tax Act.

Posts / Replies

[Padmanathan Kollengode]

This is only my view. I am open to contrary views as well.

Explanation 2.-In this sub-section, "due date" means,-

(a) where the assessee other than an assessee referred to in clause (aa) is-

(i) a company ; or

(ii) a person (other than a company) whose accounts are required to be audited under this Act or under any other law for the time being in force; or

(iii) a partner of a firm whose accounts are required to be audited under this Act or under any other law for the time being in force or the spouse of such partner if the provisions of section 5A applies to such spouse,

the 31st day of October of the assessment year;

"accounts are required to be audited" applies to

1. This Act. ie Income Tax Act, 1961

2. Any other law for the time being in force.

As mentioned by yourself in query accounts are not required to be audited under LLP Act as well.

The provision qouted by you only says that "if" partners decided to get the books of LLP audited, the accounts shall be audited only in accordance with rule 24

In other words, the said provision does not creates any compulsion or obligation to audit the books of LLP. Rather it only says that even if the books are voluntarily audited, rule 24 shall be applicable.

Thus, your case fails to satisfy "ruquired to be audited" both under IT Act, as well as LLP Act, in my view