26 November 2008
section 43(5) Speculative transactions means a transaction in which contract for the purchase or sale of any commodity, including stocks & shares, is periodically or ulitmately settled otherwise than by the actual delivery or transfer of the commodity or scrips. provided that for the purposes of this clause:- a) a contract in respect of raw materials or merchansied entered into by aperson in the course of his Mfg, or merchanting businees to gruad against loss through future prices fluctations in respect of contracts for actutal delivery of goods Mfg ured by him or sold
15 December 2008
Commodity transactions are done through Commodity Exchanges and not through Stock Exchanges. The treatment of Profit and Loss under the Income Tax may be construed in view of Section 43(5) which is as per under:
Delivery based: Non-speculative Derivative trades: Speculative but for hedging trades it is non-speculative.
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