Chapter: 1.1.2 Common Definations

Business: As per S. 2 (13) business includes any far trade, Ebb commerce or (c) manufacturer; or (d) any venture or concern in the nature of trade, commerce or manufacture.

The definition of 'business ' in S. 2 (13) is not exclusive. It covers every facet of an occupation carried on by a person with a view to earning profits. The expression 'business' is used in a taxing statute in the sense of an occupation or profession) which occupies time, attention and labour of a person, normally with the object of making profit.

Document: Section 2 (22AA) has been inserted w.e.f. 1.6.2001. As per this new sub section "document" includes an electronic record as defined in S.2 (1) (i) of the Information Technology Act, 2000

Income: The definition of the term 'Income' in S. 2 (24) is inclusive and not exclusive. Therefore, the term 'Income' not only includes those items which are included in S.2 (24) but also includes such items which the term signifies according to its general and natural meaning. The definition of the expression 'Income ' is rather longish and it is not necessary for our purpose to deal with its various aspects in detail. Income for instance includes: Profits & gains, dividend income, voluntary contributions received by a trust created wholly or partly for charitable or religious purpose. Income also includes the value of any perquisite or profit in lieu of salary and also any special allowance or benefit other than perquisite specially granted to a person to meet expenses wholly, necessarily and exclusively for the performance of the duties of an office or employment of profit. Further, income includes any capital gains chargeable u/s 45, any winnings from lotteries crossword puzzles, races including horse races, card games & other games. There are other heads of earning included in the definition of income but only major items of income are given above.

Person S2(31): For the purpose of taxing the income of a person the Income Tax Act defines the entity of the person as under:

The term 'person' includes:
(a)    an individual
(b)    A Hindu undivided family (H.U.F)
(c)    a company
(d)    a firm
(e)    an association of persons (AOP) or a body of individuals (BOI), whether incorporated or not
(f)    a local authority; and
(g)    Every artificial juridical person, not falling within any of the preceding categories.

There are seven categories of person chargeable to tax under the Act. The aforesaid definition is inclusive and exclusive. Therefore, any person not falling in the aforementioned categories, may still fall within the term ' person' and accordingly may be liable to tax under the Act.