Section 44AE of the Income Tax Act

Income-tax Act, 2025: s.58

Section 44AE of the Income-tax Act, 1961 corresponds to section 58 (Special provision for computing profits and gains of business or profession on presumptive basis in case of certain residents) of the Income-tax Act, 2025.

Read section 58 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 44AE is Goodyear (I) Ltd. v. ITO (73 ITD 189), cited in 27 of the 159 judgments on BharatTax that turn on this section.

Leading authorities on Section 44AE

Goodyear (I) Ltd. v. ITO
73 ITD 189 · 2000 · ITAT
27
citing judgments

Expenditure incurred for the transfer of the use of licenses, without acquiring ownership rights or an enduring benefit, constitutes revenue expenditure. Such payments are allowable as a deduction if they are directly relatable to services in the revenue field.

CIT v. Sidhartha Enterprises
322 ITR 80 · 2010 · High Court
23
citing judgments

Penalty under Section 271(1)(c) is imposed only when there is a deliberate default and not a mere mistake. The furnishing of inaccurate particulars must be a deliberate attempt to evade tax, not just a mistake.

DCIT v. Surface Finishing Equipment
81 TTJ 448 · 2003 · ITAT
23
citing judgments

Non-compliance with notices issued under section 133(6) alone is not a sufficient basis to deny the genuineness of expenditure incurred by a company. The assessee's obligation extends to providing correct names and addresses of parties, not ensuring their response.

(India) Limited v. Additional Commissioner of Income Tax
254 ITR 673 · 2002 · High Court
11
citing judgments

Ad hoc additions to income are not legally sustainable. Mere non-compliance with notices under section 133(6) does not invalidate genuine expenditure. Losses incidental to business should be allowed as deductions in the year of discovery.

(i) CIT v. Nikunj Eximp Enterprises Pvt. Ltd.
77 Taxmann.com 275 · 2017 · ITAT
11
citing judgments

The recording of purchase transactions and subsequent export of goods in the books of accounts can prove the genuineness and veracity of such purchase transactions.

IT vs. Kerala Transport Co. (1994) 51 ITD (Coch) 405 (iv)Om Prakash Joshi v. ITO
102 TTJ 882 · 2006 · ITAT
10
citing judgments
Commissioner of Income Tax v. Harsh D Mehta
251 Taxmann 346 · 2017 · High Court
9
citing judgments
(i) CIT vs Jalaram Oil Mills (2001) 171 CTR (GUj) 426 (ii) Vishwakarma Industries v. CIT
135 ITR 652 · 1982 · High Court
8
citing judgments
ITO v. Shantilal Chuni-lal & Co.
45 ITD 581 · 1993 · ITAT
7
citing judgments
ITO v. Bindra Ban Bansi Lal
78 ITD 228 · 2001 · ITAT
6
citing judgments

Judgments on Section 44AE

Sri Sobat Singh, Sonebhadra vs. Income Tax Officer, Ward-3(4), Mirzapur

In the result, the appeals of the assessee for A

ITA 253/ALLD/2018[2007-08]Status: DisposedITAT Allahabad05 Jul 2021AY 2007-08

Bench: Shri.Vijay Pal Raoassessment Year: 2007-08 & Assessment Year: 2013-14 Sri Sobat Singh V. Income Tax Officer Ward- Murdhwa Renukoot, Sonebhadra, 3(4) Uttar Pradesh -231221. Mirzapur. Tan/Pan: Azups2354N (Appellant) (Respondent) Appellant By: Shri Praveen Godbole, C.A. Respondent By: Shri A.K. Singh, Cit ( Sr. Dr) Date Of Hearing: 13.07.2021 Date Of Pronouncement: 15.07.2021 O R D E R Per Shri Vijay Pal Rao: These Two Appeals By The Assessee Are Directed Against Two Separate Orders Of Cit(A)- Allahabad, Both Dated 21.12.2017 For The A.Ys. 2007-08 & 2013-14 Respectively. 2. For The A.Y.2007-08, The Assessee Has Raised The Following Grounds.- 1. “That In Any View Of The Matter Assessment Made On Income Of Rs. 17,64,000/- By Order Dated On 30.01.2014 Passed U/S 143(3) Is Bad Both On The Facts & In Law. 2. That Is Any View Of The Matter The Proceeding Initiated U/S 148 Is Illegal Proceedings Since The Reasons For Issue Of Notice U/S 148 Was Not Supplied To The Assessee Nor Any Opportunity Was Provided By The Assessing Officer In Making Compliance & Simply Assessing Officer On The Basis Of His Own Presumption Made Addition Which Action Is Highly Unjustified.

For Appellant: Shri Praveen Godbole, C.AFor Respondent: Shri A.K. Singh, CIT ( Sr. DR)
Section 143(3)Section 148Section 44ASection 69Section 69A