SECTION 43(5) DERIVATIVE TRANSACTIONS
This query is : Resolved
09 August 2010
AS PER 43(5) F&O INCOME COMES UNDER BUSINESS TRANSACTION BUT THE LOGIC IS NOT CLEAR TO ME. WHY IT SHOULD NOT BE TAKEN AS SPECULATIVE TRANSACTION? AND IF NOT THEN WHY NOT SHORT TERM OR LONG TERM CAPITAL GAIN TRANSACTION? AND WHAT ABOUT TRANSACTIONS IN CASE OF COMMODITY TRADING, WHERE WILL IT BE PLACED AND REASON? PLEASE CLERIFY IN DETAIL...
THANKS
THANKS
09 August 2010
A transaction is called speculative if it is without delivery of underlying asset/item.
Transaction in derivatives are presently cash settled & do not involve delivery of any kind.
The motive behind trading is to earn only from diff in prices & not investment.
Also they expire at specified time.
Hence the profit therefrom is not capital gain but treated as business income. Hwever, earlier they wr considered as speculative business but now are regarded as non speculative.
Transaction in derivatives are presently cash settled & do not involve delivery of any kind.
The motive behind trading is to earn only from diff in prices & not investment.
Also they expire at specified time.
Hence the profit therefrom is not capital gain but treated as business income. Hwever, earlier they wr considered as speculative business but now are regarded as non speculative.
09 August 2010
In addition to above Commodities Trading is still considered as speculative business as it is not carried out on a recognised stock exchange in India for Income Tax purpose.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Is this income indian or foreign income?
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- ITC temporary reversal and reclaim
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- GST on export of services and Input Credit
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- TDS U/S. 194NF
- Applicable TDS rate for sale of property in Nov 2024
- GST ON EXPORT COMMISSION
- Should I report my US salary for January, February, March in Schedule FA?
- LAST YEAR 2022-23 ITC IN NEXT YEAR 2023-24 REPORITNG IN GSTR-9
- MIS MATCH OF INVOICE NUMBER
- IGST Credit-Show cause notice issued-confusion
- Issue of gst e invoice
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- Regarding einvoice taken on nil rated sales
- Strategical investment in Public listed company
Trending Online Classes
CAclubindia
