Question ID : 20754

APPLICABILITY OF TAX AUDIT FOR DERIVATIVE TRANSACTIONS(F&O)

Hello members, My client is a salaried person and also borne loss of Rs.7.00lakhs from Derivative transactions on a turnover of Rs.14lakhs (turnover arrived considering sum of positives and negatives in trade). As per section 43(5), this is non-speculative business. But other than business loss his Total Income(salary after deduction) is less than the maximum amount not chargeable to tax (i.e. below Rs.2.50lakhs).

So, My question is: Whether to set off and carry forward the loss of Rs.7lakhs, tax audit is mandatory? or
whether I can file the return simply by showing loss from business and If yes ,then can the same be carry forward?
Can loss from F&O be set off with Capital Gains?

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