Case Law Details
Association of National Exchanges Members of India Vs SEBI (Bombay High Court)
CBDT has clarified that where a derivative contract is being settled by physical delivery of shares, the transaction would not be any different from transaction in equity share where the contract is settled by actual delivery or transfer of shares. It further states that, the rates of STT as applicable to such deliverybased equity transactions shall also be applicable to such derivative transaction. As such, the position is clarified by CBDT that it does not differentiate between present transactions which are delivery based and derivative transactions. It has been clarified that the rate of both the transactions would be the same.
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
1] Petitioner has approached this Court being aggrieved by the communication dated 17th July, 2018 issued by Respondent No.2 – National Stock Exchange of India Limited.
2] By the said Circular, Respondent No.2 had informed the members of the Petitioner – Association that Respondent No.2 has decided to levy Securities Transaction Tax (hereinafter referred to as “STT”) at the rate of 0.10% (i.e. the rate applicable for taxable securities transaction settled by actual delivery in the CM segment) on the settlement price to be paid by the purchaser of the futures contract which are settled by way of physical delivery. The Circular also provided that, in the event if the CBDT issues any clarification or amendment in this regard in addition to or contrary to the above position, Respondent No.2 had reserved the right to recover such additional STT from the members effective from the date as may be notified by the CBDT.
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