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Short of Vocation Not Under This Section: "Trade"

The three sources of income - business, profession, and trade - are all taxed under the same head. While the section uses the word "business", profession is understood to include any occupation. Income from an occupation that does not qualify as a profession would not be taxed under this section. Trade has the widest legal scope and can refer to small shopkeepers as well as large commercial enterprises. The word "business" has an even broader meaning than trade. Judicial decisions have expanded the definitions of both trade and business over time. For an activity to qualify as a business under section 2(9), it must involve a real, substantive and systematic course of activity conducted with a consistent purpose. The word "concern" also

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26 views1 page

Short of Vocation Not Under This Section: "Trade"

The three sources of income - business, profession, and trade - are all taxed under the same head. While the section uses the word "business", profession is understood to include any occupation. Income from an occupation that does not qualify as a profession would not be taxed under this section. Trade has the widest legal scope and can refer to small shopkeepers as well as large commercial enterprises. The word "business" has an even broader meaning than trade. Judicial decisions have expanded the definitions of both trade and business over time. For an activity to qualify as a business under section 2(9), it must involve a real, substantive and systematic course of activity conducted with a consistent purpose. The word "concern" also

Uploaded by

zamurd shah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Of assessment under the Act profit from these three sources are

treated and taxed alike under the same head. The section uses here
only the word “Business”. Since “Profession” includes vocation
throughout the Act ; Income arising from an occupation which falls
short of vocation is taxable not under this section .
“Trade” is, not only in the etymological or dictionary sense but in legal
usage, a term of the widest scope; it may mean the occupation of a
small shopkeeper equally with that of a commercial magnate and may
also mean a skilled craft. The word “Business” has even a wider
content than the word “trade”. The trend of judicial decisions has
been in the direction of enlargement rather than restriction of the
connotation of trade and business.
The words used in the definition of business (section 2 (9)) are wide,
but underlying each of them is the fundamental idea of the continuous
exercise of an activity. In the words of S R Das J, “The word
‘Business’ connotes some real, substantive and systematic or
organized course of activity or conduct with a set purpose” . The word
“concern” is a very wide word, and appears to imply an adequate
degree of business organization for the purpose of carrying on the
undertaking.

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