Comment on Notice under Section 139(9)? - Possible reason
commented on
11 Jan 2014, 07:34 AM
Hi Nikhil,
IT department considers trading in F&O as a business, in a business you have to file your returns irrespective of whether you make profits or not. Do you need your books audited?
1. If your turnover is over Rs 1crore, every business needs to have their books audited, including the people who trade F&O
2. This weird rule where certain businesses including trading in F&O has been included. So if your profit less than 8% of turnover, even those have to be audited.
The penalty is not 8%, what I meant was that IT department could consider your profit as 8% of your turnover, in your case around Rs 48,000 and then you would have to add this to your income/salary and pay taxes according to that slab.
But if you see, I have used words like “would” “could”, because no one has complete clarity on this, and only a small portion of traders have received notices. In the markets if you are an active trader, it is according to us a good practice to have your books audited from the start, but you can have a word with your CA on this as well.