Comment on Taxation for Traders - Introduction

chella commented on 04 Sep 2013, 02:29 AM

Dear Sir,
Finance Act 2005 has amended the provision to section 43(5), with effect from Assessment Year 2006-07, to provide that derivatives trading transactions would not be regarded as ‘speculative’ transactions, subject to the fulfillment of certain conditions. (The conditions are such as traded in recognized Stock exchanges etc). Hence trading in futures is not speculative but business. But I have a doubt that in view of the following provisions CA audit is not required.

Clause (d) of section 44AB, provides that in the case of an assessee carrying on a business of the nature specified in sections 44AD, tax audit will be required, if he claims his income to be lower than the presumptive income deemed under the said section and income exceeds the maximum amount not chargeable to income-tax (i.e. basic exemption limit).
Please clarify whether
i) ‘income’ and ‘profit or gains’ mentioned in the above Section. Whether both are one and the same. If a house hold lady trading in futures and no other income but only overall loss during the year, I think is covered under above provision where tax audit is not required. This may be confirmed.
ii) If she wants to carry forward the loss for previous year now can she get her ‘tax audited’ by CA and file return now prior to 30-09-2013 or whether return should have been filed prior to 31-07-2013


View the full comment thread »