turnover for audit u/sec-44AB

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dipesh (Querist)
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04 September 2009 I am trading in shares on a regular intra day basis.I record the net payable or receivable from the broker on a daily basis.Is the method correct.I dont record my gross sales as turnover.

eg:-On a single day i have purchased Shares of Rs.1,00,000 and sold it for Rs.1,25,000 then i simply record the net receivable of Rs 25,000 as my turnover.Moreover ,suppose i have purchased shares of Rs.50,000 and sold it for Rs.30,000 then i record net payable of Rs.20,000 as my purchase.Please answer me soon as i have got a notice u/sec-143(2) of scrutiny and i havent got my accounts audited on this basis.

CA CHINTAN AJMERA

CA CHINTAN AJMERA (Expert)
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04 September 2009 No this is not correct method. In intraday if u square off the transaction then net method is ok but in case u take delivery or give delivery of any share then this is recorded as purchase and sale not on net basis.