My client is s*x worker, She want to submit her return of income ,
in which head i have to show the income Under PGBP or OTher source,
Further i would like to know whther service appliliable or not,
Please very urgent,
Thanks in advance
sam (partner) (31 Points)
29 May 2010My client is s*x worker, She want to submit her return of income ,
in which head i have to show the income Under PGBP or OTher source,
Further i would like to know whther service appliliable or not,
Please very urgent,
Thanks in advance
sam
(partner)
(31 Points)
Replied 30 May 2010
This realy a practical problem that my boss is facing.
I need your advice frnds
Bhavik Davda
(Proprietor)
(238 Points)
Replied 02 June 2010
Amir
(Learner)
(4016 Points)
Replied 02 June 2010
With due respect to Bhavik Sir, I would like to draw his attention to the following -
Source need not be legal - There is nothing to indicate that the source must be one which is recognised under the law for if that were so, then the income derived from illegal business could not be liable to tax - CIT v. Smt. Shanti Meattle /Addl. CIT v. Ram Kripal Tripathi
Illegal income - Primary function of Income-tax Act is to bring income of various kinds into tax net and tax authorities are not concerned about manner or means of acquiring income. Income might have been earned illegally or by resorting to unlawful means, but illegality tainted with earning has no bearing on its taxability and income earned by an offender still would be an income liable for assessment. Thus, income earned by assessee from income-tax refunds collected by him illegally by producing bogus TDS certificates would be assessed under Act - CIT v. K. Thangamani [2009] 177 Taxman 499/309 ITR 15 (Mad.).
Further as far as deduction of expenses is concerned - I would like to quote the famous case of Piara Singh, where Honble SC held that confiscation of smuggled article is subject to deduction as business expenditure.
The bottom line is the principles of computation of income are indifferent to the legalilty of any transaction/business. {Expenses incurred in relation to earn illegal income will be allowed to be deducted unless specifically prohibited}
deepak K Gujrati
(CA-practice)
(966 Points)
Replied 16 June 2010
The Income tax act is not concerned with the legality or illegality of business or profession. Hence, income of illegal business or profession is not exempt from tax.
As she is carrying out it as business, it will be taxable Under PGBP.
As this service is not defined under service tax , it will not attract service tax.
CA B Anand
(CHARTERED ACCOUNTANT)
(198 Points)
Replied 30 June 2010
INCOME TAX DEPT, WANTS REVENUE.
THEY DONT EXPECT THE TAX AMOUNT TO BE CHARGED ONLY FROM THE LEGAL BUSINESS,.
IF THE ILLEGAL BUSINESS ARE EXPEMT FROM INCOME TAX / ASSESSMENT, THEN EVERYONE WILL
DO ILLEGAL BUSINESS.
IN SHORT, INCOME TAX IS A TAX ON " INCOME" WHETHER OR NOT IT ARISES FROM A LEGAL SOURCE OR ILLEGAL SOURCE.
SHE IS A PROFESSIONAL BY HER WORK, AND HENCE HER INCOME SHOULD BE TAXED UNDER BUSINESS OR PROFESSION.
WHO KNOWS, SHE MAY BE LIABLE FOR TAX AUDIT TOO....
GSTR 9 and 9C for FY 23-24 as amended by Notification 12/2024 dated 10th July 2024(with recording)
CAclubindia
