ITR-3 Section P&L - speculative income - no books case - 61AD vs 64 vs 65

Report the speculative loss in Section 65 (Speculative Activity) of ITR-3, as Section 61AD (presumptive/Section 44AD) does not permit declaring losses or speculative income, and Section 64 is for non-speculative activities.

Thank you verymuch for the prompt reply. Now I can submit the returns without any worry. 

If you have not maintained books of accounts and your income arose out of speculation, then we shall go for Item 65- Speculative Business in ITR-3. The turnover of 10000 will not change the character of your income. Section 61AD is on prescripttive taxation and not on the treatment of speculative business losses. 

Section 64 applies to a non-speculative business/profession without maintenance of books. 

For a fact is that the Income Tax Department has itself made validation rules in ITR-3 where speculative business income/loss is mapped with item no 65; if no books are maintained, then there is no other option available. Hence, Item 65 would be correct for your scenario.

Experts above are correct , USE SECTION 65 for speculative income/loss in ITR-3.

WHY SECTION 65:

• Section 65 is EXCLUSIVELY designed for speculative business income/loss (intraday equity, commodity speculation etc.)
• Section 64 is for non-speculative business where no books are maintained
• Section 61AD (Presumptive 6%) applies ONLY when showing profit , you CANNOT use it for a speculative LOSS

SINCE YOU HAVE A LOSS , key benefits:

• Speculative losses can be CARRIED FORWARD for up to 4 ASSESSMENT YEARS under Section 73
• Can ONLY be set off against speculative profits in future years (not normal business income)
• To carry forward the loss, ITR must be filed BEFORE the due date (July 31 / extended deadline)

DOCUMENTATION EVEN WITHOUT FORMAL BOOKS:

• Your broker's contract notes / trade statements for the year = sufficient evidence
• Net P&L statement from broker downloadable from trading platform

Signal priority: P2 , technical filing question with carry-forward loss stakes