f&o Income and short term gains

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.

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

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:

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.

point (d) mentions derivatives (f&o)

i am still not clear. i want to declare f&o as business income under 44AD and short term capital gains under capital gain. how can i do it?

short term capital gain from trading in delivery shares can also be shown under business income, depends on volume and frequency

thank you Dipti.

please note, if there is any intraday trading in equities, then it falls under speculative transaction

yes intraday is speculative but that can also be added in business income. correct?

if profit yes, but loss can only be set off against speculative gains

agreed. than you:)