What is the Dabba Trading? Is Dabba Trading Profitable?

Dabba Trading:- Dabba trading is a type of proxy trading that occurs outside of the stock exchange. It is a parallel stock market where traders can speculate on the direction of share prices or stock indexes without opening a trading account, demat account, or giving KYC information. 

Dabba trading is banned in India and is equated with gambling. Investors in dabba trading do not open a Demat account with a broker to buy and sell stocks on the stock exchange, but rather trade through a brokerage platform that serves as the counterparty to deals made by the consumer.

Is it Dabba Trading Profitable?

Dabba trading is banned in India and is equated with gambling. Although dangerous, it has the potential to be rewarding for the operator. However, dabba trade is fraught with deception, and there is no certainty of a settlement. It is a risky investment because of the lack of controlling norms and regulations. 

Read More: NSE cautions investors against 'Dabba Trading'

Dabba trading is exempt from income tax, commodity transaction tax (CTT), and securities transaction tax (STT). Dabba trading transactions occur outside of market norms, and there is no regulating entity to control it. As a result, dabba trading is not recommended because it is unlawful and dangerous.

Is it Dabba Trading illigal?

Dabba trading is banned in India and is equated with gambling. Although it can be profitable for the operator, there is a considerable danger of fraud and no certainty of a settlement. It is a risky investment due to the lack of controlling norms and regulations. 

Dabba trading is exempt from income tax, commodity transaction tax (CTT), and securities transaction tax. (STT). Dabba trading transactions occur outside of market norms, and there is no governmental entity to regulate them. 

As a result, dabba trading is not recommended because it is unlawful and dangerous.

What is the penalty for Dabba Trading?

In India, dabba trading is prohibited, and those who engage in it face criminal charges and punishments. The Securities and Exchange Board of India (SEBI) fined Anand Rathi Share and Stock Brokers Ltd Rs 6 lakh for unauthorised trading operations. 

Dabba trading is considered gambling in India and is therefore prohibited. Dabba trading is outlawed under the SEBI Prohibition of Fraudulent and Unfair Trade Practices in Securities Market Regulations, 2003. 

Dabba trading is typically done without the customer's knowledge or agreement and may be considered fraud if the crime is found. As a result, it is not recommended to engage in dabba trading because it is unlawful and carries significant consequences.