Tax audit - Capital gain on shares trading

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This discussion addresses whether an individual earning professional income and trading shares is liable for a tax audit. It clarifies that if the total sales value of shares, including speculation, short-term, and long-term trades, does not exceed Rs 2 crore, a tax audit is generally not applicable. The advice also confirms that even if the short-term trading sales alone exceed Rs 2 crore, a tax audit would still not be mandatory in this specific scenario.

Suraj

Suraj (Querist)
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25 June 2022 Dear Sir / Madam,

During FY 2021-22,Mr A was earning professional income. Besides this, he was also trading in shares.

The sales value of shares trading is as follows:
Speculation - Rs. 18,46,034/-
Short Term - Rs. 1,97,70,738/-
Long Term - Rs. 1,71,863/-
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Total Sales value / Turnover - Rs. 2,17,88,634/-

Will he be liable for Tax audit in this case?

Secondly, what if Sale value of Short term trading alone exceeds Rs. 2 Crore, will the tax audit be applicable then?

Kindly guide.
Thanks & Regards,
Suraj