section 43

Taxation of Derivatives

Income Tax - Since, there is no transfer or delivery of the underlying asset in case of futures, the income or loss from it cannot be taxed under the head “capital gains. Therefore, depending upon the fact whether the assessee is a trader or an investor, the head of income — that is, income from business and profession or income from other sources...

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All About Speculative Business and Speculative Transactions

Income Tax - Article explains how Speculative Business is Distinct Business, What is speculative transaction, What shall not deemed to be speculative transactions, What is Eligible Transaction for security derivative, Recognised stock exchange for Section 43(5), Recognised association for Section 43(5), What are the Eligible Transaction for Commodity ...

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Contribution to Provident Fund- Tax ability- Employer’s View

Income Tax - According to section 36(1)(iv) any sum paid by the assessee as an employer by way of contribution towards a recognized provident fund shall be allowed as a deduction in computing the income referred to in section 28 (income under PGBP)....

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Speculative Transactions A Brief Note

Income Tax - Speculative transaction means a transaction in which a contract for the purchase or sales of any commodity including stocks and shares, is periodically or ultimately settled otherwise than by the actual delivery or transfer of the commodity or scrips [section 43(5)]. Here important term is periodically or ultimately settled otherwise than...

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Treatment of Cash Transactions above Rs 2 Lakhs

Income Tax - As we all are aware of Section 269ST which was introduced by finance act, 2017 in Income tax act, 1961 by the central government in order to curb the tax evasion, regulation and circulation of Black money. This article will cover the detailed analysis of the said section alongwith some practical examples. 1. Basic Understanding […]...

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Income arising out of trading of commodities at unrecognized stock exchange amounts to speculation income

DCIT Vs. Ms. Edelweiss Capital Ltd. (ITAT Mumbai) - Ms. Edelweiss Capital Ltd. Vs DCIT (ITAT Mumbai) From the record, we found that assessee was carrying out business of commodity trading on un-recognised exchange and also business of trading in shares. Assessee has claimed set off of loss arising out of trading in shares against the income arising o...

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Explanation to section 73 supersede provision of section 43(5)(d)

ITO Vs. M/s. Arandi Investments Pvt. Ltd. (ITAT Mumbai) - ITO Vs. M/s. Arandi Investments Pvt. Ltd. (ITAT Mumbai) Assessing Officer treated loss in future and options (F&O) transactions as speculation loss and disallowed the same. We find that on this issue, the A.O. has referred to Honorable Delhi High Court decisions on identical issue. The Honorable...

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Derivatives Profit / Loss: Section 43(5)(d) applies from AY 2006-07

M/s. Nilliampathy Tracon (P) Ltd. Vs. A.C.I.T. (ITAT Kolkata) - Kolkata bench of Income Tax Appellate Tribunal (ITAT) has recently held that loss derived from trading in derivatives carried out prior to 25/01/2006 cannot be treated as speculative loss and it should be treated as normal business loss under the provisions of the Income Tax Act, 1961. ...

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Section 43(5)(d) applicable only on derivatives trading (future & options) and not on share trading

ACE India Medical Systems Vs ACIT (ITAT Jaipur) - In the case of ACE India Medical Systems Vs. ACIT Jaipur Bench of ITAT held that from the bare reading of the section 43 (5) (d) it is prima facie clear that Section 43(5)(d) is for trading in derivatives not trading of shares....

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Loss from Forex Derivative trading upto export turnover is business loss & not speculative loss

M/s. Majestic Exports Vs JCIT (ITAT Chennai) - In the case of M/s. Majestic Exports vs. JCIT, ITAT Chennai held that the loss in the transactions of the forex derivatives contracts will be considered to be the business loss and the same can be set off against the business income. ...

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CBDT notifies more modes of e-payments; 6DD limit reduced to ₹ 10000

Notification No. 08/2020-Income-Tax [G.S.R. 56(E)] - (29/01/2020) - Notification No. 8/2020-Income-Tax- CBDT has notified Other electronic modes by inserting New Income TAx Rule 6ABBA. It also amended marginal heading of rule 6DD and in rule 6DD for the words ‘account payee bank draft, exceeds twenty thousand rupees’, the words, figures and letters ̵...

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CBDT notifies Ace Derivatives and Commodity Exchange Ltd.’ for trading of commodity derivative U/s. 43(5)

Notification No. 15/2014-Income Tax - (20/03/2014) - Notification No. 15/2014-Income Tax entral Government hereby notifies the Ace Derivatives and Commodity Exchange Limited, Ahmedabad as a recognised association for the purposes of clause (e) of the proviso to clause (5) of the section 43(5), with effect from the date of publication of this notificat...

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Recent Posts in "section 43"

Taxation of Derivatives

Since, there is no transfer or delivery of the underlying asset in case of futures, the income or loss from it cannot be taxed under the head “capital gains. Therefore, depending upon the fact whether the assessee is a trader or an investor, the head of income — that is, income from business and profession or income from other sources...

Read More
Posted Under: Income Tax |

CBDT notifies more modes of e-payments; 6DD limit reduced to ₹ 10000

Notification No. 08/2020-Income-Tax [G.S.R. 56(E)] (29/01/2020)

Notification No. 8/2020-Income-Tax- CBDT has notified Other electronic modes by inserting New Income TAx Rule 6ABBA. It also amended marginal heading of rule 6DD and in rule 6DD for the words ‘account payee bank draft, exceeds twenty thousand rupees’, the words, figures and letters ‘account payee bank draft or use of ele...

Read More

All About Speculative Business and Speculative Transactions

Article explains how Speculative Business is Distinct Business, What is speculative transaction, What shall not deemed to be speculative transactions, What is Eligible Transaction for security derivative, Recognised stock exchange for Section 43(5), Recognised association for Section 43(5), What are the Eligible Transaction for Commodity ...

Read More
Posted Under: Income Tax |

Contribution to Provident Fund- Tax ability- Employer’s View

According to section 36(1)(iv) any sum paid by the assessee as an employer by way of contribution towards a recognized provident fund shall be allowed as a deduction in computing the income referred to in section 28 (income under PGBP)....

Read More
Posted Under: Income Tax |

Speculative Transactions A Brief Note

Speculative transaction means a transaction in which a contract for the purchase or sales of any commodity including stocks and shares, is periodically or ultimately settled otherwise than by the actual delivery or transfer of the commodity or scrips [section 43(5)]. Here important term is periodically or ultimately settled otherwise than...

Read More
Posted Under: Income Tax |

Treatment of Cash Transactions above Rs 2 Lakhs

As we all are aware of Section 269ST which was introduced by finance act, 2017 in Income tax act, 1961 by the central government in order to curb the tax evasion, regulation and circulation of Black money. This article will cover the detailed analysis of the said section alongwith some practical examples. 1. Basic Understanding […]...

Read More

Derivatives- Income Tax Provisions

According to Securities Contract Act 1956, the derivative is a contract between two or more parties, and its price is directly related to the fluctuations of price of the underlying asset. The most common types of derivatives in India are futures and options. Futures: Future is a contract to buy or sale an underlying asset […]...

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Posted Under: Income Tax |

Income arising out of trading of commodities at unrecognized stock exchange amounts to speculation income

DCIT Vs. Ms. Edelweiss Capital Ltd. (ITAT Mumbai)

Ms. Edelweiss Capital Ltd. Vs DCIT (ITAT Mumbai) From the record, we found that assessee was carrying out business of commodity trading on un-recognised exchange and also business of trading in shares. Assessee has claimed set off of loss arising out of trading in shares against the income arising out of trading in commodities. The [&hell...

Read More

Explanation to section 73 supersede provision of section 43(5)(d)

ITO Vs. M/s. Arandi Investments Pvt. Ltd. (ITAT Mumbai)

ITO Vs. M/s. Arandi Investments Pvt. Ltd. (ITAT Mumbai) Assessing Officer treated loss in future and options (F&O) transactions as speculation loss and disallowed the same. We find that on this issue, the A.O. has referred to Honorable Delhi High Court decisions on identical issue. The Honorable Delhi High Court in the case of CIT [&h...

Read More

Trading in agricultural commodity derivatives – Non-speculative transaction

It is proposed to amend the provisions of clause (5) of section 43 to provide that a transaction in respect of trading of agricultural commodity derivatives, which is not chargeable to CTT, in a registered stock exchange or registered association, will be treated as non-speculative transaction....

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Posted Under: Income Tax |

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