Case Law Analysis
|Income Tax Appellate Tribunal
Section 44AD | Profit Estimation for Unaccounted Business Must Be Reasonable & Grounded in Audited Accounts, Not Arbitrary Presumptions : ITAT Ranchi
ITAT Ranchi slashed the presumptive profit rate from 8% to 3% for an unaccounted electronic goods business, ruling that tax authorities cannot impose arbitrary additions without rejecting books or proving higher margins. The decision reinforces that presumptive taxation under Section 44AD must align with actual business performance, protecting small traders from speculative assessments.