F&O transactions for Portfolio hedging

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Maheep S (Querist)
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29 April 2020 I’m a long term investor and have portfolio of shares. I don’t maintain books of accounts as my income is from salary, house property and as partner in firm. I want to do few f&o transactions(4-5 in a year) to hedge my portfolio in this volatile situation. My question are:-
1. Does IT deptt allow f&o transactions in my case as STCG/capital gain. For eg I have a LOT of PFC shares in form delivery shares(cash) since two yrs and I want to sell future as I think PFC will fall in near time. Under which head this transaction profit/loss will be considered? Can it be treated as stcg?
2. As I donot prepare books of accounts as I am not trader and my income is below limit. Will I haveto prepare books of accounts? I dont want to maintain as it is not compulsory right now.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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30 April 2020 1 It will not fall under any capital gains. It will be considered as business profit/ loss.
2 Opt for 44AD no need to maintain books of accounts.

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