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Tax audit applicability in f&o trading

Anonymous (Business) (240 Points)

15 July 2018

case (a) Turnover above 1 cr and having loss but income frok other heads less than 2.50 lacs. Opting for ITR 3 to c/f loss.

case (b) Turnover less than 1 cr , having loss but income from other head exceeds income tax exemption limits. Opting for ITR 3 to c/f loss.

case (c)

case (c) same as (a) but turnover less than 1 cr.

Thanks in advance.

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6 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (172809 Points)
Replied 15 July 2018

Tax audit applicable in case (a) & (b)....... but not in (c) ..

2 Like

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Anonymous (Business) (240 Points)
Replied 15 July 2018

Thankyou Dhirajlal ji Rambhia sir.

In case of (c) where no tax audit applicable as you said ,assesee did option trading.

sum of fav plus unfav differrence (should I take gross or net ? ) anyways, is less than 1 cr.

but if I add squared up value then it exceeds 1 cr. No option writing . Only BTST.
Now whether tax audit applicable ? if still not then whether books of A/c need to be maintained and B/sheet to be filed as turnover exceeds 25 lacs.
Assesee is filing ITR 3 loss return.

Other income less than 2.5 lacs.

What is the right business code to select?

Broker also provide turnover report where traded value is above 2 cr. Does this figure has any relevance ? It is actually Total Buy +Total Sales.

Best Regards,

rama krishnan (12234 Points)
Replied 15 July 2018

in all criteria, tax audit is mandatory

Anonymous (Business) (240 Points)
Replied 15 July 2018

hi Rama krishnan ji
why tax audit is mandatory in case of situation (c) ?

rama krishnan (12234 Points)
Replied 15 July 2018

What provisions will apply if a person who is eligible for the presumptive taxation scheme of section 44AD declares his income at a lower rate (i.e. less than 8%/6%)?|whether tax audit is mandatory if i m earning income below 6% of gross reciepts / 8% of of gross reciepts or total turnover?| Is their any mandatory force where my turnover say 60 lac and my NP comes below 8 or 6% as the case me to get audited?
A person can declare income at lower rate (i.e., less than 8%/6%), however, if he does so, and his income exceeds the maximum amount which is not chargeable to tax, then he is required to maintain the books of account as per the provisions of section 44AA and has to get his accounts audited as per section 44AB.

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Anonymous (Business) (240 Points)
Replied 15 July 2018

In situation (C )assessee income from other heads is less than 2 .50 lacs . On the other hand , loss from f&o trading is large amount.
Can he take advantage of this exemption limit of 2.50 lacs and skip tax audit while opting for ITR3.
Regarding turnover sum of favourable plus unfavourable difference is less than 1 cr. but if squared of value is added then its exceed 1 cr.