Clause 26 - Amendment of section 44AD.

Presumptive taxation under section 44AD: loss of presumptive eligibility triggers five year disqualification and audit obligations.

Where an eligible assessee uses the presumptive basis under section 44AD but in any of the five succeeding assessment years declares profit not in accordance with that provision, the assessee loses eligibility for the presumptive regime for the next five assessment years; further, if such an assessee's total income exceeds the basic exemption limit, they must maintain prescribed books and obtain and furnish an audit report as required under the statutory audit provisions.