Casual Income [ Sec. 56] : Income from horse races, winning from lotteries, cranky word puzzles, label gains or gambling or betting, winning from T.V programmes, propitious dips, conducted by commercial operation establishments have been couple of examples of casual incomes. This incomes have been taxable underneath Sec. 56 underneath a conduct Income from alternative sources.

 

Assessee [ Sec. 2(7)] : Any chairman who is probable to compensate taxation or any alternative total of income ( interest, penality, etc..) is an Assessee.

It is tangible underneath territory 2(7), which states which the chairman by whom any tags or any alternative total of income is upon credit underneath this action & includes

·         Any chairman opposite whom the little record underneath this action have been starting on.

·         Any chairman by whom the little volume of tax, seductiveness or penality is payable.

·         Any chairman to whom reinstate is due

·         Any chairman who has suffered waste though filled returns

·         Any chairman who is obliged upon interest of the minor, goofy or the non-resident is the deemed assessee.

·         Any chairman deducts taxation during source though doesn’t deposition it in supervision book is assessee upon default.

Like correct if the chairman doesn’t allege tax, he is additionally an assesee in default..

Exceptions to a Rule which taxation is levied upon a income of Previous Year in Assessment year / Special Provisions of Income Tax Act 1961:

The Various exceptions or supplies of Income Tax Act 1961 are:

·         Persons Leaving India

·         Non-Resident Shipping Companies

·         Income from a Dis-Continued business

·         Persons transferring their resources to equivocate Tax

·         Incomes of bodies shaped for reduced duration

(a).  Perious Year in box of stability business:

It is a monetary year  preceeding a applicable comment year.

(b). Previous Year in box of newly setup business:

The prior year in box of a newly setup commercial operation shall be a preiod in in between derivation of commercial operation as well as 31st Mar subsequent following.

(c). Previous Year in box of deemed Incomes:

·         Unexplained Cash Credits

·         Unexplained Investments

·         Unexplained Cash, Bullion, Jewellery

·         Unexplained Expenditure

·         Payment of Hundi Money in Cash.

Unexplained income credits: In box any volume is found to be credit in a books of assessee as well as he is incompetent to give a acceptable reason about such credit, afterwards such volume will be treated with colour with colour as income of a prior year in which it was found in a books.

Unexplained Investments: In box an assessee has done a little investment in shares, securities, genuine estate, etc a same were not available in a books of comment as well as is incompetent to give acceptable reason with courtesy to a source of supports to accquie these investments afterwards such volume of a prior year in which they have been made.

Unexplained Cash, Bullion, jewellery: when a assessee is found with additional income bullion or alternative profitable articles, which have been not available upon a books as well as is not in a on all sides to give acceptable explanation, how he has acquired these, such unexplained volume is deemed as a income of a prior year in which these were found in his possession.

Unexplained Expenditure: where asessee has incurred sure losses for which no acceptable reason was since per to a source of income, such output shall be treated with colour with colour as a income of a prior year in which a output has incurred.

Payment of Hundi income in Cash: Every remuneration opposite hundi contingency be done by comment payee cheque, differently a volume shall be deemed as a income of a year in which such remuneration is made.

Exceptions:

Generally a income warranted during a prior year is taxed in a comment year. But in a following well-developed cases, a income is taxed ih a year in which it is earned.

·         Persons Leaving India: If a ITO ( Income Tax Officer) has reasons to hold which an particular will be withdrawal India with no goal to lapse during a stream prior year afterwards a sum income of such chairman from a derivation of stream year to a date of his depart shall be assessed in a same prior year.

·         Non – Resident shipping Companies: A Non proprietor shipping companies which has no deputy in India earns income by carrying passengers or products or live batch (cattle etc) from any Indian Port will be charged Income Tax prior to it is authorised to leave a Indian Port.

·         Income Of Dis one after another Business: In box any commercial operation or contention is dis one after another during a prior year, a income of a duration from a derivation of a stream prior year compartment a date of dis delay will be assessed to taxation in a stream prior year itself.

·         Persons Likely to send Assests to equivocate Tax: It Income Tax Officer suspects which any chairman is expected to send his skill or assests to equivocate tax, he might embark record to assessee a income for a duration in in between a derivation of a stream year as well as a date of derivation of such proceedings.

Basic Concepts of Income Tax:

·         Assessee [ Sec. 2(7)]

·         Person [ Sec. 2(31)]

·         Assessement Year [Sec. 2(9)]

·         Previous Year [Sec. 3]

·         Casual Income [Sec. 56]

 

Assessee [ Sec. 2(7)] : Any chairman who is probable to compensate taxation or any alternative sum of income ( interest, penality, etc..) is an Assessee.

It is tangible underneath territory 2(7), that states that a chairman by whom any yaks or any alternative sum of income is upon credit underneath this action & includes

·         Any chairman opposite whom a little record underneath this action have been starting on.

·         Any chairman by whom a little volume of tax, seductiveness or penality is payable.

·         Any chairman to whom reinstate is due

·         Any chairman who has suffered waste though filled returns

·         Any chairman who is obliged upon interest of a minor, goofy or a non-resident is a deemed assessee.

·         Any chairman deducts taxation during source though doesn’t deposition it in supervision book is assessee upon default.

Like correct if a chairman doesn’t allege tax, he is additionally an assesee in default..

 

Person [ Sec. 2(31)] : The word chairman is a far-reaching term. It includes

·         Individual: It refers to a healthy vital tellurian being.

 

·         HUF ( Hindu Undivided Family):  It equates to a family that consists of all persons, linearly descendent from a usual forerunner together with their wives as well as unwed duaghters.

 

·         Company: It is an artifical chairman purebred underneath Indian Companies Act 1956 or any alternative law.

 

·         Firm: It is an artifical entity that comes in to life as a outcome of partnership agreement. The usually condition for a partnership entity to be assessed as organisation is that it contingency submit, a partnership deed.

 

·         AOP ( Association of persons) : A organisation that has not submitted a partnership help or series of partners is some-more than twenty, afterwards it is treated with colour as an AOP.

Example: Cooperative societies, Trustees of a certitude etc.

·         Local Authorities: Muncipalities, Panchayats, Contonment Boards, Port trusts, etc have been internal authorities.

 

·         Artifical Juridicial Person: Statuory Coorporations similar to LIC, Universities etc have been called Arificial juridicial Persons.

 

Assessement Year [Sec. 2(9)] : It is tangible underneath territory 2(9), that states that A.Y is a duration of twelve months commencing upon a initial day of Apr any year as well as finale upon a final day of impetus a subsequent year.

For Example : the stream assessement year 2009-2010 commences from Apr 1, 2009 as well as ends upon impetus 31, 2010. Tax is levied in any comment year, with apply oneself to or upon a sum income warranted by a assesse in a prior year. It is additionally well well known as Tax Year.

 

Previous Year [ Sec. 3 ] : It is tangible underneath territory 3 of Income Tax Act 1961, whivh equates to it is a duration of twelve months prior to a derivation of a comment year. Generally it is a monetary year ( 1st Apr to 31st march) preceding a asessment year as a assessement year regularly rught away follows a prior year. Income warranted in a prior year is taxable in a rught away following comment year during a rates specified by a revelant Finance Act for any such comment year. Hence , a year in that is warranted is a prior year as well as a year in that such income shall be taxed is a comment year. For a stream comment year 2009-2010, The prior year 2008-2009 commences from Apr 1, 2008 as well as ends upon impetus 31st, 2009. It is additionally well well known as Income Year.

 

Casual Income [ Sec. 56] : Income from horse races, winning from lotteries, cranky word puzzles, label gains or gambling or betting, winning from T.V programmes, propitious dips, conducted by commercial operation establishments have been couple of examples of casual incomes. This incomes have been taxable underneath Sec. 56 underneath a conduct Income from alternative sources.

 

 Meaning of Income Tax:

 Income Tax equates to taxation from Income of a person. Income taxation was initial time introduced in India by Sir.James Wilson in a year 1860. At benefaction Income Tax Act 1961 is enforced.

Meaning Of Income [ Sec 2(24)]:

 Income underneath Income Tax Act 1961, Income is tangible under   Section 2(24) does not have any wider clarification though it has a far-reaching meaning. It in all includes Profits, gains, perquisites, dividends, interest, allowances, distinction upon sale of assets, winning from lotteries.

Characteristics of Income Tax:

The assorted characteristics of income taxation have been as follows:

• He/She contingency have a clear or correct source of income
• He/She contingency have a only at certain time of year volume of return.
• The income can be possibly in money or in kind.
• The income can be proxy or permanent one.
• It can be upon taking or increase basis.
• The Income can be authorised or bootleg one.
• The income contingency come from outside.
• It might be a intentional receipt.
• The income doubtful or doubtful income additionally assessable to tax.
• The volume could be in lumpsum or in installments.
• The volume or income might additionally can be a disastrous one…

But excludes a following:

• Re imbursement of assorted expenses
• The income might be a Fictious Income
• It might be in a form ofPersonal Gifts