adhoc determination of income under income tax.

[gangaram chandwani]

Are there any case laws available on subject of adhoc additions and adhoc determination of income under income tax law?

[Guest]

Hi Chandwani,

There is no adhic basis of calculation of income tax. But the newly incorporated section 44AD provides for 8% of the gross receipts/gorss turnover as the net income from business. However, this section is not applicable in case of Professionals( as defined in Income Tax).

Regards

SHARIQUE

AI Summary

Ad hoc income determination discouraged; presumptive taxation under section 44AD sets deemed business income but excludes professionals. Ad hoc methods for determining taxable income are not a valid basis; income must be computed under the statutory framework. The presumptive taxation mechanism treats a fixed percentage of gross receipts as deemed net income for eligible businesses, but the presumptive scheme excludes persons defined as professionals, who must follow regular computation provisions.