whether comes under sec 44AB for tax audit (CLARIFY)

This query is : Resolved

mohit arora (Querist)
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27 May 2008 sir, i have 1000 shares of satyam computers @rs 500 means total delivery in my account is rs 5 lacs. if i sold 1000 shares at higher rate say 520 and then recover at 500 then total sales in my account is 520000. if same entry repeated means sold at higher rate and recover at low prices then after repeating 8 times my total sales exceeds 40 lacs but my intial totol investments only 5lacs. i have only repeated the entry . whether i falls under sec 44AB for tax audit or not YES MEANS REPURCHASE. YES TAKING PHYSICAL DELIVERY

CA. Yayati Tyagi

CA. Yayati Tyagi (Expert)
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27 May 2008 if u r investing in personal capacity as an investor, then 44AB will not apply and profit will be chargeable as capital gain.

if engaged in business of buying/selling shares, 44AB will apply irrespective of initial investment as and when total sales crosses 40 lacs.

CA UMESHKUMAR R. ACHARYA

CA UMESHKUMAR R. ACHARYA (Expert)
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28 May 2008 The Nature of repetitive Transctions of Shares indicates intention of earning profit and as Turnover Exceeds Rs.40 lacs you are liable for Tax Audit u/s 44ab.