Karaate clasess-whether business or profession ?

This query is : Resolved

CA Abhishek Singh (Querist)
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28 February 2013 Hello everyone,

one of my client runs karaate classes. and his gross receipts in fy 11-12 was 40 lacs.

whether income will be treated as business income or professional income?

CA. PIYUSH GOEL

CA. PIYUSH GOEL (Expert)
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28 February 2013 Dear CA Abhishek Singh...

The term professional in sec. 44AB denotes every profession which is specified u/s 44AA.

and Sec. 44AA covers Medical, accountancy, legal, etc. it does not cover any other profession. in your case it will cover under the catagory other services and you can get benifit of the limit of Rs. 1 crore.

however it is a debatable issue because sec. 44AD speaks about only for buisness and profession.
and professional hereby mean only those profession which is specified u/s 44AA. it does not speak about other service providers.

CA Abhishek Singh

CA Abhishek Singh (Querist)
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28 February 2013 definition of term profession u/s. 44AA is only for the purpose of maintenance of books of account and not for tax audit.

for tax audit the same is given under section 2(36) which is very wide and not limited to profession specified u/s. 44AA.