Harsh Girish Patel (Final CA Student) 22 May 2012

44 ab - inclusion of reimbursement of expenses

Dear All Members,

A one assessee is a doctor by profession & skin specialist also deals with the patients having HIV AIDS.
he has made an arrangement of pathological reports & medicines etc for his patients
for which he his reimbursed by the patients & his bill also provides the breakup of the same
for reports & medicines he is not charging extra amount over and above the cost for such services to him
so my question is whether for applying section 44AB reimbursement of aforesaid expenses is to be included or not?

Plz provide your opinion on the said matter.

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1 Replies

C. P. CHUGH (Practicing Lawyer) 22 May 2012

In Profession whatever is charged from customers/clients/patients forms part of the gross turnover and as such is to be included for the purposes of section 44AB. Otherwise, whatever the said doctor is paying for outsouricing services such as pathology, xray,ultrasound are also subject to deduction of tax at source under chapter XVIIB of the Act. Now assuing he is deducting and paying tax at source by treating those payments as his expenditure, then why corresponding receipts should not be his income/gross receipts.