Speculation

Is share trading by Investment company speculation ?

June 16, 2010 By taxworry Leave a Comment

Archived; click post to view.
Excerpt: Some one asked on this blog on 23/10/06We are an investment company. Our funds are majorly deployed in granting loans and advances(more than 80%). and we are also trading in shares.We have received demand notice from ITO for the A.Y.2002-2003 and A.Y. 2003-2004. The demand has arisen mainly because of non acceptance of our business income and treating the same as speculative income without considering the fact that our business is consisted of shares trading as well as advancing of loans and funds ,investment in loans and advances substantially more than in the business of share trading, which is improper…

Originally posted 2006-10-23 16:44:00. Republished by Blog Post Promoter

Filed Under: A of Your Question, Shares Business, Speculation

Now Derivative Trading in Foreign Exchange Is Business Activity!

May 30, 2009 By taxworry Leave a Comment

Archived; click post to view.
Excerpt: In India , there are two main commodity exchanges –Multi Commodity Exchange of India Ltd (MCX ) and National Commodity & Derivative Exchange Ltd NCDEX in India where one can trade in derivative contract of different items –from pulse to metal. Now there is another exchange MCX Stock Exchange Ltd in which one can trade derivatives of foreign exchange.The transactions in derivative segments are regarded as “Speculative transaction” which has a great bearing on the taxation of one’s income as the loss out of speculation is not allowed to be adjusted with any other income . Speculation loss is allowed…

Filed Under: Business Income, Speculation Tagged With: Business Income

Why Is F & O Transaction Business Activity From 25/1/2006 And Not From 1/4/2005?

December 19, 2008 By taxworry Leave a Comment

Archived; click post to view.
Excerpt: Whether Trading in Nifty Futures, amount to trading in derivates and as a result not a speculative transaction as per the amendment to sec 43(5) by Fiance act 2005. RAMESH V RAICHUR, BelgaumFutures and option trading-whether in individual shares or Nifty futures – was regarded as speculation business as per section 43(5) of the I T Act. Finance Act 2005 brought the amendment by which clause e was insterted in provision to section 43(5) to provide that transaction in F & O shall be business transaction and not regarded as “speculation”. The said amendment was as under(d) an eligible transaction in respect of…

Filed Under: Speculation

What Is The Basis For Determining Turnover In Case Of Speculation?

July 21, 2007 By taxworry Leave a Comment

Archived; click post to view.
Excerpt: If a person is engaged in share trading and turnover of delivery based buying & selling is less than 40 lacs but speculation business in share trading where intra-day sale purchase is effected but delivery is not taken exceeds 40 lacs, is tax audit applicable ? surendra.gandhi@……in This issue was subject to controversial interpretation by assessee and income tax department.The issue had come up in case of Babulal Enterprise vs ACIT before Mumbai bench of ITAT [1999-2000] wherein it was held that where the actual delivery was not taken and difference in price was settled on the basis of…

Filed Under: A of Your Question, Speculation

Hedging Loss is Buisness Loss , not Speculation Loss!

February 27, 2007 By taxworry 1 Comment

Archived; click post to view.
Excerpt: Can a loss from hedging of commodities be set off against normal profit of a related commodity merchant? agrawalneeraj@sify.comYes, there is express provision under the I T Act ,by which loss from hedging of commodities are allowed to be taken not as Speculation Loss and thus on characterized as Business Loss , is allowed to be adjusted with Business Income.Speculation is defined u/s 43(5) of the I T Act . Clause (a) of sub section 5 of section 43 is given as under :” (5) speculative transaction means a transaction in which a contract for the purchase or sale…

Filed Under: A of Your Question, Speculation