Mr. Balwant, a resident individual, engaged in retail trade, reports a turnover of ₹2,97,50,000 for financial year 2024-25. The amount received in cash during the PY 2024-25 is ₹13,50,000 and balance through prescribed e

Where an eligible assessee declares profit for any previous year in accordance with the provisions of section 44AD and he declares profit for any of the five assessment years relevant to the previous year succeeding such previous year not in accordance with the provisions of sub-section (1) of section 44AD, he shall not be eligible to claim the benefit of the provisions of section 44AD for five assessment years subsequent to the assessment year relevant to the previous year in which the profit has not been declared in accordance with the provisions of sub-section (1) of section 44AD. If Balwant opts for presumptive taxation scheme then he is also required to follow the presumptive taxation scheme for next 5 years. If Balwant failed to do so, then presumptive taxation scheme will not be available for him for next 5 years subsequent to the assessment year relevant to the previous year in which the profit has not been declared in accordance with the provisions of sub-section (1) of section 44AD. Here, Balwant claims to be taxed on presumptive tax basis under Section 44AD for AY 2024-25. However, for AY 2025-26, if he did not opt for presumptive taxation Scheme. In this case, he will not be eligible to claim benefit of presumptive taxation scheme for next five AYs, i.e., from AY 2026-27 to 2030-31. As his total income as per books of accounts is ₹16 lakh which is less than ₹18.12 lakh (presumptive basis), he is required to keep and maintain books of accounts u/s 44AA and also liable for tax audit as per section 44AB and furnishing the said report within the prescribed timelines.