Dear Sri....
Tax audit is to be done when one's turnover is above 40 Lacs...For those in other industry it is the basic sale achieved....But in the case of transactions of F&O there is a difference...
For the purpose of F&O transactions the limit of 40 Lacs is the profit or loss in absolute terms...Let me explain with an example....
Suppose you bought one lot of 150 shares of Financial Technology at Rs. 3000...Then you sold it at 3100....Therefore your profit is 100*150=15000...
Now you bought one lot of 1400 shares of HCC at 100 and then sold it for 110...so your profit if 10*1400=15000...
Third, you bought one lot of 8000 shares of IFCI at 60 and then sold it for 50...so you incur a loss of Rs. 10*8000=80000...
therefore for the purpose of determining the total turnover you achieved would be 15000(FTIL profit) + 14000(HCC profit) + 80000(IFCI loss) = 1,19,000....
it would not be the total transaction values but the absolute profit or loss incurred in the transactions...
I hope it is now clear .....
Tax audit is to be done when one's turnover is above 40 Lacs...For those in other industry it is the basic sale achieved....But in the case of transactions of F&O there is a difference...
For the purpose of F&O transactions the limit of 40 Lacs is the profit or loss in absolute terms...Let me explain with an example....
Suppose you bought one lot of 150 shares of Financial Technology at Rs. 3000...Then you sold it at 3100....Therefore your profit is 100*150=15000...
Now you bought one lot of 1400 shares of HCC at 100 and then sold it for 110...so your profit if 10*1400=15000...
Third, you bought one lot of 8000 shares of IFCI at 60 and then sold it for 50...so you incur a loss of Rs. 10*8000=80000...
therefore for the purpose of determining the total turnover you achieved would be 15000(FTIL profit) + 14000(HCC profit) + 80000(IFCI loss) = 1,19,000....
it would not be the total transaction values but the absolute profit or loss incurred in the transactions...
I hope it is now clear .....