Tax Audit U/s 44AB for Day Trading

Respected Amitji,

U/S - 44AB of Income Tax Act.1961 if any business gross sales, Turnover, receipts are above Rs.40 lacs then this accounts are to be Audited under Income Tax Act. ie Tax Audit.

Thanks

Debashis

Actually I want to know what is included in this Forty Lacs in case of day trading- is it difference of purchase and sale price of shares or is it net sale price of shares?

it includes gross receipts ......

What is gross receipt of share trading business?

sale price of shares ...

Dear Amit,

Here r 2 things - Gross Receipts or sales

Sales means the Shares which u sold to square off the Transaction & Gross Receipts r the total amount u taken as margin or profit, so conflect is here, Law has not so clarified about the term of sales, so far i studied, so it can be taken from case laws or some assumptions may be possiable, as per law the word used is sales or turnover not amount realised, so from my point of view it is ur sales value & not the margin amount u recd.

Debashis

hi amitji ,

here the net  difference between the purchase and sales price of shares wd been taken for calculation of turnover , nd this mit  ur gros receipt also0. 

 Yes Dharmesh is Right !

Sorry I was wrong, Now i am attaching some of my downloading for your reference

For shares trading ( Delivery or F & O or Day Trading ) Tax audit becomes applicable only if the net Income exceed (Difference to Sales /Purchase ) exceeds 40Lkhs. & Not your trading T/O else every person dealing or trading in shares would have been in Audit. 

 Please provide me scrutiny norms for the AY 2009-2010