section 44AD, Income Tax

[sunil mehta]

A) Section 44AD(5) of Itax act says that if eligible assessee claims to have income lower than 8% of gross T/O AND his TOTAL INCOME EXCEED basic exemption limit then he shall keep books of a/cs u/s 44AA and get them audited u/s 44AB.

B)From the above that means if eligible assessee (a PROPRIETORY FIRM )having T/o less than 1 cr and showing income <8% AND his TOTAL INCOME is BELOW basic exemption limit then it is not mandatory to keep bks u/s 44AA and get them audited u/s 44AB .

Query:-

1)Is contention in (B) correct ?If 'NO' then WHY ?

2)If the IT return of the above firm is selected in scrutiny then whether ITO can ask for books,records (business related transactions enquiry ) ?

3)Can penalty be levied on the proprietor u/s 271B for not getting the books audited ?

4) In case of 'Eligible Assessee' under clause 'B' above , the I.Tax return of that proprietor be filed in Form 4S or in form 4 (assuming that assessee has only business income )