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f&o Income and short term gains

24 June 2017

csn i show income from f&o as per presumptive method and short term equity trades as STCG. if yes, which itr should be filed since there is no option of STCG in itr 4 for 2016-17.

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12 Replies

chetanptl1993@gmail.com (11 Points)
Replied 24 June 2017

You shouldn't filed ITR 4 coz now you're doing f & o there should be fall in speculation business so should be filed compulsory ITR 3 and in case loss of speculation business there should be set off in relevant year.

dipti sharma (117 Points)
Replied 24 June 2017

section 43(5) specifically excluded F&o transactions from being treated as speculative transactions, as such they are to be treated as normal business income, and dealt with accordingly

rama krishnan (12244 Points)
Replied 24 June 2017

attn ms. Dipti, pls explain the meaning of actual delivery in the following provision
[5] "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:

dipti sharma (117 Points)
Replied 25 June 2017

Agreed Sir, about the speculative transaction , but please read the provisos along with it (5] "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 vc 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 [ac] of section 2 of the Securities Contracts [Regulation] Act, 1956 [42 of 1956] carried out in a recognised stock exchange; or

[e] an eligible transaction in respect of trading in commodity derivatives carried out in a recognised association , which is chargeable to commodities transaction tax under Chapter VII of the Finance Act, 2013 [17 of 2013],

shall not be deemed to be a speculative transaction.