|Whether “tuition fees” is an income from business, profession or vocation and whether such income is covered u/s. 44ADA?
|The heading of section 44ADA is “Special provision for computing profits and gains of profession on presumptive basis”. Section 2(36) defines “Profession” includes vocation So, ibid, section has defined profession very widely. The word “vocation” has been defined in Corpus Juris secundm, as calling, occupation or trade one’s regular calling or business, a calling or occupation or business in which one engages more or less regularly in the activity upon which a person spends the major portion of his time and out of which he makes his living, that to which one is called by some special fitness or sense of duty. But section 44ADA is applicable only to a person who is engaged in profession referred to in section 44AA.
Section 44AA reads as:
“Every person carrying on legal, medical, engineering or architectural profession or the profession of accounting or technical consultancy or interior decoration or any other profession as is notified by the Board in the Official Gazette shall keep and maintain such books of account and other documents as may enable the Assessing Officer to compute his total income in accordance with the provisions of this Act”.
Vide various notifications additional professions would cover:
I. “Profession specified for the purpose of section 44AA – In exercise of the powers conferred by sub-section (1) of section 44AA of the Income-tax Act, 1961 (43 of 1961) the Central Board of Direct Taxes, hereby notifies for the purposes of the said sub-section the following professions, namely –
(a) Profession of authorised representative; and
(b) The profession of film artist.
Explanation – in this notification –
(a) “Authorised representative” means a person, who represents any other person, on payment of any fee or remuneration, before any Tribunal or authority constituted or appointed by or under any law for the time being in force, but does not include any employee of the person so represented or a person carrying on legal profession or a person carrying on the profession of accountancy:
(b) “film artist” means any person engaged in his professional capacity in the production of a cinematograph film, whether produced by him or by any other person as –
(i) An actor
(ii) A cameraman
(iii) A director, including an assistant director
(iv) A music director, including an assistant art director
(v) An art director, including an assistant art director
(vi) A dance director, including an assistant dance director;
(vii) An editor
(viii) A singer
(ix) A lyricist
(x) A story writer
(xi) A screen play writer
(xii) A dialogue writer; and
(xiii) A dress designer
II, “In exercise of the powers conferred by sub- section (1) of section 44AA of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby notifies the profession of Company Secretaries for the purpose of the said section.
Explanation – In this notification, ‘Company Secretary’ means a person who is a member of the Institute of Company Secretaries of India in practice within the meaning of sub-section (2) of section 2 of the Company Secretaries Act, 1980 (56 of 1980).
III. In exercise of the powers conferred by sub- section (1) of section 44AA of the Income-tax Act 1961, the Central Board of Direct Taxes hereby notifies the profession of information technology for the purposes of the said sub section.”
Thus, though section 2(36) profession covers vocation, the vocation is not covered under section 44ADA and therefore “tuition fee” would not be covered under section 44ADA of the Act.
|CA. H. N. Motiwalla
|Presumptive taxation- Profession -Tuition Fees – Whether covered u/s. 44ADA
Opinion Of Eminent Legal Luminaries On Controversial Issues
Presumptive taxation- Profession -Tuition Fees – Whether covered u/s. 44ADA
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