Valuation of loss on shares

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sanchit jain (Querist)
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08 January 2014 if an individual say Mr. a holds some shares say 1000 shares in y ltd. a listed company since many years. now during the year he buys 500 more shares of same company later during the year he sells 200. now as per income tax whether it shall deemed to be long term profit/loss or short term. is it actually fifo or LIFO that should b applied in such a case also if total trade value of individual in share markets exceeds one crore does is he liable to get his accounts audited. the account is in the personal name of assrsee himself.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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09 January 2014 first-in-first-out...till the time 1000 shares are sold, it will be LTCG. thereafter it will depend on how long you hold the new 500 shares purchased during th current year.

44AB will apply if the assessee is in the business of share trading...So you need to check whether the assessee is doing share investment or trading...accordingly 44AB will apply...in case of investment it wont..

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