Applicability of tax to other than person.

This query is : Resolved

Prasad B Waikar (Querist)
Follow

30 January 2011 The definition of person u/s 2(31)of Income Tax Act 1961 includes (Individuals,HUF Company etc.)but it doesn't include any animal (eg.small dog of vodafone) suppose the
vodafone made payment to such dog for T.V. advertisement,then how the income of such dog
is taxable under Income Tax Act 1961.
please explain briefly.

B. Gopalkrishna Baliga

B. Gopalkrishna Baliga (Expert)
Follow

30 January 2011 Interesting as well as funny query. Would like to answer it.
See Mr. Waikar, the definition of Person includes an individual, a HUF, partnership firm (including LLP), Company, AOP, BOI etc. It does not include any animal. But that does not mean that any income arisen to an animal like dog of vodafone or the elephant in Haathi mere saathi will not be taxed.
Now understand the concept and purpose of Income Tax Act. The purpose of I-Tax Act is to charge tax on income of the person as defined u/S 2(31). Tax is charged only for the defined persons because these are the one who ultimately enjoy the benefits of income i.e. benefits of money.
the dog in vodafone case or any animal in any advertisement, film etc. are not going to enjoy the money; rather they do not need any monitory income to survive. Only human beings need money, I hope you will agree on this point. Thus, the owner of the concerned animal will be charged to tax because though the animal has worked, it is not going to claim the money for his survival. It is its owner who receives the income. Money is not paid to the Dog, it is paid to its owner. Hence the owner will be charged to tax because he/she is using the animal as means of his survival and source of income.

Guest

Guest (Expert)

30 January 2011 Agree with Mr. Baliga. However, can you show that payment was received by the dog ?

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now