No as per income tax act u r not liable to maintain books of account. You should have either attach certificate of CA that you are not liable to maintain books of account stating the reason because people selecting tender may be not knowing this fact. Or you could have prepare the pl balance sheet based on those figures for submission to.the company.
Tender
Dear Sirs, I am a civil Contractor & file my return under u/s 44AD @ 9%. Last month I Quoted for a IOCL tender in which they asked for :- 1. Details of Annual Turnover. Audited Accounts/Balance Sheets for Financial Years 2013-14, 2014-15 & 2015-16. 2. Audited Balance Sheet of the relevant Details of Annual Turnover. Audited Accounts/Balance Sheets for Financial Years 2013-14, 2014-15 & 2015-16 . 3. Scanned copy of CA certified annual turnover of previous three financial years i.e. 2013-14. 2014-15 & 2015-16. The turn over as per audited accounts, submitted by the tenderer shall be the basis for further evaluation, wherever required. If the party is submitting the Turn-over documents only for one year or two years than average turn-over shall be calculated by dividing the sum by 3. To this I submitted my ITR, Computation of tax in which it was mentioned Gross Receipts 14.20 Lacs & Net Profit @ 9% u/s44AD of IT Act. The Computation was Stamped by by CA & written on it was "Certified True Copy" & signed below. Then again IOCL raised objection to submit CA Certified copy of Balance Sheets, to which my CA made a Balance sheet (Stamped by by CA & written on it was "Certified True Copy" & signed below.) but I did not attach any Trading, Profit & Loss account as my CA said same is not prepared under u/s 44AD. Now my tender have been rejected due to Financial Credentials documents. Is it a valid reason by IOCl to reject my tender as I have not attached Trading, Profit & Loss account ?, Was it mandatory to attach these documents with Balance Sheet as IOCL only used word to upload Unconditional CA certified balance sheet of 2014 15 Balance sheet of 2015 16 ? please help me out, is IOCL correct on their part ? or should i fight & knock door of court for justice. Plz help. 7814065658
Asked 7 years ago in Audit
This is IOCL policy to allot Tender to applicants who's accounts audited ,
Under 44AD you have option to declare profit equal to or more than 8% and not require to prepare any bs and pl
You can still prepare your bs and pl even you are filling Itr u/s 44AD and your CA Can provide you Audit Report under 44AD
Thus fulfill tender related formalities/documents
Sir,
First of all even if you file your return under section 44AD you can always have books of accounts to justify your total sales, purchase, gross profit and net profit so you can always submit profit & Loss account. also when you file return u/s 44AD there also it is mandatory to submit details of Cash Balance, Bank Balance , Sundry Creditors Balance & Sundry Debtors balance so you can also submit the same whenever it is asked in tender.
The purpose of asking this documents to understand genuineness of the party and in the even where you do not submit the same it always created doubts in the other side that you may not be doing genuine activity and in the activity like tender you always suffered because of it. They only have this one reason and for them its mandatory otherwise in their internal audit by third party it consider as their default in tendering process. So even they may want to support you they might not on account of the documents you have submitted.
So in my opinion stand of IOCL is absolutely right, you need to adjust your records as per their needs and need to submit it for your business.
Sh. Vishrut ji.. As per the objection raised by IOCL they asked to submit & used words "CA certified Balance Sheet" , My CA prepared Balance Sheet and same submitted to IOCL but without P&L account & Trading a/c, Can it be treated as complete or is it compulsory to make trading, Profit & loss account with Balance sheet. IOCL said Balance sheet but did not use words like P&L a/c, trading a/c to submit. As words used Balance Sheet so we submitted Balance Sheet but not Trading, P&L a/c. can we be saved by these words ?
Asked 7 years ago
Sir,
A word balancesheet of financial statement always include "Trading Account & Profit Loss Account along with the Balancesheet"
If you trust my advise please dont focus on fighting with IOCL. it will not give you any result and may effect your future business with them
Dear Sir,
It is whole and sole discretion of IOCL to ask for the relevant information. You may not be required to maintain p&l and b/s as per income tax act but if IOCL wants it, you will have to submit it to complete the tender application.
Please feel free to call/revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
Dear Abhishek, is it mandatory to submit P&La/c & trading a/c when they have used word to submit balance sheet ? Is there any at of IT which says Balance Sheet should accompany the P&L a/c & Trading a/c. This tender is very important for me & only due to only one paper i hve got rejected.
Asked 7 years ago
Then you should make profit & loss on the basis of figures submitted to department. Then you will be able to submit the documents to company
Dear Sir,
If they have used the word balance sheet then you may not required to submit p&l but if they have used the word audited accounts, it means both p&l and b/s.
Please feel free to call/revert in case of any doubts
Thanks and Regards
Abhishek Dugar
CA CS B.Com
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