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Intra Day Transactions in Shares

Shailesh (Article) (49 Points)

23 June 2010

Effect of Intraday Transaction in Futures and Option will be trated as Speculation Business or Normal Business?

Kindly provide section reference...!

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8 Replies

Amir (Learner) (4016 Points)
Replied 23 June 2010

Dear Sailesh,

Non speculative -clause (d) of Provio to Sec 43(5)

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DT Fundas - Tarun rustagi ( Author) (1150 Points)
Replied 23 June 2010

an eligible transaction in respect of trading in derivatives referred to in clause ⁶⁷[(ac)] of section 2 ⁶⁸ 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.

⁶⁹[Explanation.—For the purposes of this clause, the expressions—

(i) “eligible transaction” means any transaction,—

(A) carried out electronically on screen-based systems through a stock broker or sub-broker or such other intermediary registered under section 12 of the Securities and Exchange Board of India Act, 1992 (15 of 1992) in accordance with the provisions of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) or the Securities and Exchange Board of India Act, 1992 (15 of 1992) or the Depositories Act, 1996 (22 of 1996) and the rules, regulations or bye-laws made or directions issued under those Acts or by banks or mutual funds on a recognised stock exchange; and

(B) which is supported by a time stamped contract note issued by such stock broker or sub-broker or such other intermediary to every client indicating in the contract note the unique client identity number allotted under any Act referred to in sub-clause (A) and permanent account number allotted under this Act

regards

tarun rustagi

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CA Lalit (Consultant) (50 Points)
Replied 23 June 2010

i think it will depend on the nature of the business carried on by the company , if company is the investing company( main business is purchasing and selling of securites) then it will be treated as normal business and if it is a other than investing company then it will be treated as speculative business.

please correct me if am wrong ..

Shalini Nayyar (Student) (365 Points)
Replied 24 June 2010

tarun sir , it would be nice if u plz xplain it..

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Shalini Nayyar (Student) (365 Points)
Replied 24 June 2010

tarun sir , it would be nice if u plz xplain it..

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DT Fundas - Tarun rustagi ( Author) (1150 Points)
Replied 24 June 2010

dear shalini

an intra day transaction in shares is a non speculative business provided the transaction is done electronically( on computer system) and he has a contract note to that effect.( ex.- a note issued by indiabulls to his clients.)

thanks & regards

tarun rustagi

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PRAVEEN GUPTA (CA) (64 Points)
Replied 24 June 2010

intra day trade means the transaction squared off on the same day or before the settlement of the trade. any trade not resulting in delivery of shares is speculative business. however dealing in derivatves has specifically been taken out of speculative business.

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