Audit of accounts of certain persons carrying on business or profession.
44AB. 72Every person,—
(a) carrying on business shall, if his total sales, turnover or gross receipts, as the case may be, in business
exceed or exceeds one crore rupees in any previous year :
Provided that in the case of a person whose—
(a) aggregate of all amounts received including amount received for sales, turnover or gross receipts
during the previous year, in cash, does not exceed five per cent of the said amount; and
(b) aggregate of all payments made including amount incurred for expenditure, in cash, during the
previous year does not exceed five per cent of the said payment,
this clause shall have effect as if for the words "one crore rupees", the words" 73[ten] crore rupees" had
been substituted:
74[Provided further that for the purposes of this clause, the payment or receipt, as the case may be, by
a cheque drawn on a bank or by a bank draft, which is not account payee, shall be deemed to be the
payment or receipt, as the case may be, in cash; or]
(b) carrying on profession shall, if his gross receipts in profession exceed fifty lakh rupees in any previous
year; or
(c) carrying on the business shall, if the profits and gains from the business are deemed to be the profits and
gains of such person under section 44AE or section 44BB or section 44BBB, as the case may be, and
he has claimed his income to be lower than the profits or gains so deemed to be the profits and gains of
his business, as the case may be, in any previous year; or
(d) carrying on the profession shall, if the profits and gains from the profession are deemed to be the profits
and gains of such person under section 44ADA and he has claimed such income to be lower than the
profits and gains so deemed to be the profits and gains of his profession and his income exceeds the
maximum amount which is not chargeable to income-tax in any previous year; or
(e) carrying on the business shall, if the provisions of sub-section (4) of section 44AD are applicable in his
case and his income exceeds the maximum amount which is not chargeable to income-tax in any
previous year,
get his accounts of such previous year audited by an accountant before the specified date and furnish by that
date the report of such audit in the prescribed form duly signed and verified by such accountant and setting
forth such particulars as may be prescribed :
Provided that this section shall not apply to the person, who declares profits and gains for the previous year
in accordance with the provisions of sub-section (1) of section 44AD and his total sales, turnover or gross
receipts, as the case may be, in business does not exceed two crore rupees in such previous year:
Following first proviso shall be substituted for the existing first proviso to section 44AB by the Finance
Act, 2023, w.e.f. 1-4-2024:
Provided that this section shall not apply to a person, who declares profits and gains for the previous year in
accordance with the provisions of sub-section (1) of section 44AD or sub-section (1) of section 44ADA:
Provided further that this section shall not apply to the person, who derives income of the nature referred to
in section 44B or section 44BBA, on and from the 1st day of April, 1985 or, as the case may be, the date on
which the relevant section came into force, whichever is later :
Provided also that in a case where such person is required by or under any other law to get his accounts
audited, it shall be sufficient compliance with the provisions of this section if such person gets the accounts
of such business or profession audited under such law before the specified date and furnishes by that date the
report of the audit as required under such other law and a further report by an accountant in the form
prescribed under this section.
Explanation.—For the purposes of this section,—
(i) "accountant" shall have the same meaning as in the Explanation below sub-section (2) of section 288;
(ii) "specified date", in relation to the accounts of the assessee of the previous year relevant to an
assessment year, means date one month prior to the due date for furnishing the return of income under
sub-section (1) of section 139.
72. See rule 6G. Prescribed audit reports are as under:—
(i) Audit report in case of person who carries on business or profession and who is required to get
his accounts audited under any other law: Form 3CA
(ii) Audit report in case of person who carries on business or profession and who is not required to
get his accounts audited under any other law: Form 3CB
(iii) Prescribed particulars in case of (i) and (ii) above: Form 3CD.
Under proviso to rule 12(2) audit report shall be furnished electronically.
73. Substituted for "five" by the Finance Act, 2021, w.e.f. 1-4-2021.
74. Inserted by the Finance Act, 2021, w.e.f. 1-4-2021.
