Section 44AA of Income Tax Act "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 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 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 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 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 ten
lakh rupees, 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
section 44AE 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
previous year; or
(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 Assessing Officer to compute his total
income in accordance with the provisions of this Act:
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.