Is there any turn over tax for buying and selling of shares through Stock Exchange

Querist : Anonymous (Querist) 14 October 2010 This query is : Resolved
Please clarify, the limit as well if any for turn over

Follow Query

Report Abuse

R.Ramachandran (Expert) 14 October 2010
Dear Mr. Anonymous,
You have put a very very good question.
Yes, the sale of goods Act, 1930 the definition of "goods" includes shares!
But it will form part of the turnover only when you are in the business of share broking business in which case it will attract turnover tax depending upon the law on the subject - but certainly not when you buy and sell the shares as a retail investor.
You should not confuse with the provisions of the Value Added Tax Act (entailing payment of turnover tax on sale and purchase of goods) with the Income Tax Act, where the income derived from trading in the buying and selling of shares (as opposed to investment and sale of shares) has been deemed to be a "business income".

pawan sharma (Expert) 14 October 2010
agree.

Raj Kumar Makkad (Expert) 14 October 2010
I also agree with Ramachandran.

aman kumar (Expert) 20 October 2010
(3) Where under a contract of sale the property in the goods in transferred from the seller to the buyer, the contract is called a sale, but where the transfer of the property in the goods is to take place at a future time or subject to some condition thereafter to be fulfilled, the contract is called an agreement to sell.

(4) An agreement to sell becomes a sale when the time elapses or the conditions are fulfilled subject to which the property in the goods is to be transferred.