Section 44AA - Maintenance of accounts by certain persons carrying on profession or business - Income-tax Act, 1961

1 [Maintenance of accounts by certain persons carrying on profession or business. 44AA. (1) Every person carrying on legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or any other profession as is notified by the Board in the Official Gazette shall keep and maintain such books of account and other documents as may enable the 2 [ Assessing ] Officer to compute his total income in accordance with the provisions of this Act. (2) Every person carrying on business or profession [not being a profession referred to in sub-section (1)] shall,- ( i ) if his income from business or profession exceeds 3 [ one lakh twenty ] thousand rupees or his total sales, turnover or gross receipts, as the case may be, in business or profession exceed or exceeds 4 [ ten lakh ] rupees in any one of the three years immediately preceding the previous year; or ( ii ) where the business or profession is newly set up in any previous year, if his income from business or profession is likely to exceed 5 [ one lakh twenty ] thousand rupees or his total sales, turnover or gross receipts, as the case may be, in business or profession are or is likely to exceed 6 [ ten lakh ] rupees, 7 [ during such previous year; or ( iii ) where the profits and gains from the business are deemed to be the profits and gains of the assessee under 10 [ section 44AE ] 8 [ or section 44BB or section 44BBB ] , as the case may be, and the assessee 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, during such 11 [ previous year; or ] , ] 13 [ (iv) where 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, ] keep and maintain such books of account and other documents as may enable the 9 [ Assessing ] Officer to compute his total income in accordance with the provisions of this Act. 14 [ Provided that in the case of a person being an individual or a Hindu undivided family, the provisions of clause (i) and clause (ii) shall have effect, as if for the words one lakh twenty thousand rupees , the words two lakh fifty thousand rupees had been substituted: Provided further that in the case of a person being an individual or a Hindu undivided family, the provisions of clause (i) and clause (ii) shall have effect, as if for the words ten lakh rupees , the words twenty-five lakh rupees had been substituted. ] (3) The Board may, having regard to the nature of the business or profession carried on by any class of persons, prescribe, by rules, the books of account and other documents (including inventories, wherever necessary) to be kept and maintained under sub-section (1) or sub-section (2), the particulars to be contained therein and the form and the manner in which and the place at which they shall be kept and maintained. (4) Without prejudice to the provisions of sub-section (3), the Board may prescribe, by rules, the period for which the books of account and other documents to be kept and maintained under sub-section (1) or sub-section (2) shall be retained. ] --------------------------------- Notes :- 1. Inserted by the Taxation Laws (Amendment) Act, 1975, w.e.f. 1-4-1976. 2. Substituted for Income-tax by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. 3. Substituted for forty by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999. Earlier forty was substituted for twenty-five by the Finance Act, 1992, w.e.f. 1-4-1993. 4. Substituted for five hundred thousand by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999. Earlier five hundred thousand was substituted for two hundred and fifty thousand by the Finance Act, 1992, w.e.f. 1-4-1993. 5. Substituted for forty by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999. Earlier forty was substituted for twenty-five by the Finance Act, 1992, w.e.f. 1-4-1993. 6. Substituted for five hundred thousand by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999. Earlier five hundred thousand was substituted for two hundred and fifty thousand by the Finance Act, 1992, w.e.f. 1-4-1993. 7. Substituted for during such previous year, by the Finance Act, 1997, w.e.f. 1-4-1998. 8. Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. 9. Substituted for Income-tax by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. 10. Substituted vide Finance (No. 2) Act, 2009 with effect from 1-4-2011, before it was read as, section 44AD or section 44AE orsection 44AF 11. Substituted vide Finance (No. 2) Act, 2009 with effect from 1-4-2011, before it was read as, previous year 12. Inserted vide Finance (No. 2) Act, 2009 with effect from 1-4-2011 13. Substituted vide THE FINANCE ACT, 2016 w.e.f. 1st day of April, 2017, before it was read as, 12 [ (iv) where the profits and gains from the business are deemed to be the profits and gains of the assessee under section 44AD and he has claimed such income to be lower than the profits and gains so deemed to be the profits and gains of his business and his income exceeds the maximum amount which is not chargeable to income-tax during such previous year, ] 14. Inserted vide THE FINANCE ACT, 2017 w.e.f. 1st day of April, 2018