sec 44ad and sec 44ab inter change

[giri gattupalli]

respected sir,

one of my client filed ITR S for ay 2023-24 ,2024-25, 2025-26 under SEC 44AB .(audited ). now for AY 2026-27 his gross receipts are well below one crore. i want to file the itr for ay 2026-27 under SEC 44AD. please tell me is there any future consequences , if turnover for next year exceeds two crores and again need to file under sec 44ab.

and as the new income tax act is coming in to force from ay 2027-28 , the next year , what would be the consequences.

thanking you

AI Summary

Presumptive taxation eligibility permits a shift from tax audit, while voluntary exit and statutory ineligibility have different consequences.
Section 44AD may be adopted where the assessee satisfies its eligibility conditions and turnover is within the applicable threshold, notwithstanding tax audits under section 44AB in earlier years. If turnover subsequently exceeds the presumptive-taxation limit, income may be computed under normal provisions and audit liability must be assessed independently. This statutory ineligibility differs from voluntary departure while eligible, which may trigger the five-year restriction. The enhanced turnover threshold depends on the prescribed cash-receipt condition, and transition to the Income-tax Act, 2025 retains the restriction.