As per Section 2(31) of Income Tax Act, 1961, unless the context otherwise requires, the term “person” includes:
(i) an individual,
(ii) a Hindu undivided family,
(iii) a company,
(iv) a firm,
(v) an association of persons or a body of individuals, whether incorporated or not,
(vi) a local authority, and
(vii) every artificial juridical person, not falling within any of the preceding sub-clauses.
Explanation: For the purposes of this clause, an association of persons or a body of individuals or a local authority or an artificial juridical person shall be deemed to be a person, whether or not such person or body or authority or juridical person was formed or established or incorporated with the object of deriving income, profits or gains.
It may be noted that “assessee” under the Income Tax Act, 1961 is a person by whom any tax/ other dues are payable under that Act, i.e. income-tax is to be paid by a ‘person’.
The term ‘person’ as defined under the Income-tax Act covers in its ambit natural as well as artificial persons.
For the purpose of charging Income-tax, the term ‘person’, under Section 2(31) of Income Tax, includes Individual, Hindu Undivided Families [HUFs], Association of Persons [AOPs], Body of individuals [BOIs], Firms, LLPs, Companies, Local authority and any artificial juridical person.
Thus, from the definition of the term ‘person’ it can be observed that, apart from a natural person, i.e., an individual, any sort of artificial entity will also be liable to pay Income-tax.
What is the meaning of ‘an individual’ and ‘every artificial juridical person, not falling within any of the preceding sub-clauses’? Can you tell me who and all fall in these categories?
Individual is a unit of assessment covered under definition of person as per Income Tax Act and it refers to a natural person, i.e. a human being (male or female). Same way each class of persons has its own scope of coverage under Income Tax Act. Artificial Juridical Person is basically a residuary class and it may cover assessees which are not covered in any of the other specified classes of person. For example, a co-operative society may be treated as an AJP.
So does a jewellers association fall under a AJP?
It includes a deity. Hindus consider deity as a real person and offer presents. When not regulated under a trust, the deity is a PERSON.
Whether person includes a ‘person with unsound mind’?
yes, and unsound mind person is an individual, represented by a guardian who pays income tax on income of the unsound person and that representative assessee is called DEEMED ASSESSEE.
No… it doesn’t include a person of unsound mind…
Of course the term Individual includes all individual human beings – the state of mind or medical fitness is NOT the issue here.
Unsound mind doesn’t be a person because he is person disqualified to be a person in the eyes of law.
whether court is covered under AJP?
Court is not AJP as far as IT is concerned. Govt cannot tax itself. However if court is appointed as receiver, income received by court in connection with the property for which it is receiver is taxable as AJP?
Which assessees are included in person under income tax act 1961?
what about specified person?
Beneficiary Trust come under personal head?
Could someone tell me as to where and all an AOP can invest ?
Is a charitable trust included under this clause? can they be referred to as an Individual?
Where the HUF ‘Karta’ has died… who are the legal heirs to his/ HUF account?