Tax query

Save Share

Join Us Follow Us Add as Source

This query is : Resolved

Report Query Ask a Query

GITANSHU KHORIWAL

GITANSHU KHORIWAL (Querist)

12 July 2012 What is speculative business.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)

13 July 2012 As per Section 43 speculative transaction means a transaction in which a contract for the purchase or sale of any commodity, including stocks and shares, is periodically or ultimately settled otherwise than by the actual delivery or transfer of the commodity or scrips

Provided that for the purposes of this clause—

(a) a contract in respect of raw materials or merchandise entered into by a person in the course of his manufacturing or merchanting business to guard against loss through future price fluctuations in respect of his contracts for actual delivery of goods manufactured by him or merchandise sold by him; or

(b) a contract in respect of stocks and shares entered into by a dealer or investor therein to guard against loss in his holdings of stocks and shares through price fluctuations; or

(c) a contract entered into by a member of a forward market or a stock exchange in the course of any transaction in the nature of jobbing or arbitrage to guard against loss which may arise in the ordinary course of his business as such member; [or]

(d) an eligible transaction in respect of trading in derivatives referred to in clause 35[(ac)] of section 236 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) carried out in a recognised stock exchange;]

shall not be deemed to be a speculative transaction

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now