Maximization of PAT - Not avoiding Tax, Income Tax

[DEV KUMAR KOTHARI]

MAXIMIZATION OF PAT SHOUDL NOT BE CONSIDDERED AS AVOIDANCE OF TAX.STT is a convenient way of collection of more revenue.Lower rate of taxorexemption is allwoed when STT is paid. A change in fiscal polciy by government necessiate change in policy of tax payers. Tax payer is free to adopt such policies, which results into lower taxes. In view of levy of STT, if a person changes policy to hold shares as investment instead of stock or vice versa as it may suit to him, then such change in policy or accounting system should not be viewed with suspiciion or doubt.Such decisions or change in policy should be willingly accepted by the revenue authorities as bonafide commercial decision becasue aim of any investor or trader is not to avoid tax but to maximize his PAT.

Posts / Replies

[Rama Krishana]

You may be right is saying that an assessee may be kept free to decide the nature of his investment be it stock in trade or invertment. But, it has to decide at one stage of possession, if he change his stand at his conviniency, it may lead to another probolem, like carry forward / brought forward of losses, adjustment, etc. etc.