REGARDING TAXABILITY OF GAIN FROM COMMODITY TRADES

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This discussion clarifies the tax treatment of gains and losses from commodity trades. It explores whether these should be taxed under the Profits and Gains from Business or Profession (PGBP) head or as Capital Gains. The consensus leans towards PGBP, with a distinction made between speculative and non-speculative income. The applicability of Section 44AD for presumptive taxation is also examined, including how to calculate turnover for commodity trades.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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18 July 2022 Whether Gain/loss from commodity trades charge under PGBP or Capital Gains ?
If charge under PGBP then it will be consider as speculative or non - speculative ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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18 July 2022 1. PGBP
2. Non-speculative.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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18 July 2022 Okk then , can we file return by opting 44AD declaring profit at 8% .
Turnover will be business turnover plus gain/loss from commodity trades.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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18 July 2022 1. Yes, minimum 6% over commodity turnover.
2. For commodity turnover aggregate of absolute values of gains & losses are calculated.
3. If any second business? whether eligible for sec. 44AD? Combine turnover should not exceed Rs. 2 Crs.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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18 July 2022 Can we charge commodity trade under the head capital gains ?

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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18 July 2022 Can we charge commodity trade gain/loss under the head capital gains ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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18 July 2022 No. its trading not delivery based investment.

Suresh S. Tejwani

Suresh S. Tejwani (Querist)
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18 July 2022 Gain from Commodity trades is 15000
Loss from Commodity trades is 10000

then aggregate turnover will be 5000 or 25000 ?