what is crieteria for tax audit whos dealing in the shares

60 lakhs gross receipts criteria will apply

What means gross receipt here?????

wether it means Gross profit after deduction of all the charges from the Profit ?

Originally posted by : chintan
	What means gross receipt here????? wether it means Gross profit after deduction of all the charges from the Profit ?

i think it means Gross Receipts from sale of Shares.....before deducting any expenses

it will mean only receipts without charging for any expenses.

This is not the position. Turnover from sale of shares shall not be the criteria.

The criteria is the total of the mod values of the profit and the loss figures arising out of the trading transactions. This is applicable for those who want to carry it as business and not as investment.

If the gross receipts of sales is taken audit may become applicable in the very first day

Let us understand this with the helf of illustration.

Case 1:

Profit : 25 Lakhs

Loss: 25 Lakhs

Total of mod values: 50Lakhs

Audit Not Applicable

Case 2:

Profit: 40 Lakhs

Loss: 25 Lakhs

Total of mod values: 65 Lakhs

Audit Applicable

Case 3:

Profit: 10 Lakhs

Loss: 55 Lakhs

Total of mod values: 65 Lakhs

Audit Applicable

I hope you are clear with the concept now.

Thanks Amol Sir