My Client has a total income of Rs.40Lakhs from sale of Future Options which is purchsed for Rs.32 Lakhs. His principle line of business is trading in Shares. He only had 3 transaction in the whole year.Wish to Know:
1. Is it a Business Income?
2.Will Tax Audit u/s Sec 144 will be applicable to him?
3.What is the meaning of Gross Turnover in case of Future Options?
Dear Dheeraj,
1) It will be Busineess Income (Non Speculative)
2) Tax audit is done u/s 44AB
3) Turnover means = The total of positive and negative differences , plus
· Premium received on sale of options is also to be included in turnover ,plus
· In respect of any reverse trades entered, the difference thereon
But not the total value of contract.
Source -
/forum/future-and-options-trades-20387.asp
Mr.Amir brother is right....
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