STT deduction u/s 88E

[Anup Kumar Grover]

A Pvt.Ltd.Co.earns speculative loss, non speculative business income and capital gain.STT deducted on all speculative loss, non speculative business income and capital gain.The query is whether STT deducted on speculative loss earned is qualified for dedcution for calculation of rebate u/s 88E in respect of calculation of tax liability on non speculative business income. Non speculative business income is also arised from sale/purchase of shares subject to STT.

[DEV KUMAR KOTHARI]

STT rebate u/s 88 E - from A.Y. 2005-06 to 2008-09 Speculative and delivery based share trading or such activity in any business are to be established as one and the same business- the same source of income having interlacing, comon management, common P & l acccount and balance sheet etc. if they are one and the same, then total business transactions on which STT is paid (sp.+non. Sp) will be considered together, average tax on such business income will be worked out and rebate will be eligible for STT paid on all such transactions- in popular words 'global method' ( or combined method) will have to be adopted. However, as usual the revenue is likely to raise dispute to claim that rebate shll be only iro STT on transactions on which profit is earned and not iro ransactions resulting into loss. Be prepared for litigation

[shirish adhav]

I am short term capital market investor/ trader , can i claim the STT rebate u/s 88e for short term capital gain as for individual

AI Summary

STT rebate entitlement: combined treatment of speculative and delivery trades can permit rebate on STT across all transactions. Whether STT on loss making speculative trades qualifies for rebate under section 88E hinges on treating speculative and delivery based share trading as a single business; if they share common management and unified accounts, STT on all transactions can be aggregated and an average tax computed to allow rebate under a combined method, though revenue may dispute entitlement for STT on loss making transactions, risking litigation.