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Definition of direct taxes:

1. Person [section2 (31)]: The Income Tax Act, 191 !e"ies tax on a #erson. $nder%ection 2(31), #erson inc!&des:

i. An indi"id&a!

ii. A 'ind& &ndi"ided fami!iii. A om#an

i". A firm

". An Association of #ersons or *od of indi"id&a!s +hether incor#orated or not"i. A !oca! a&thorit and

"ii. "er artificia! -&ridica! #erson, not fa!!in +ithin an of the #recedin s&* /

c!asses.

2. Assessment [section 2(0)]: Assessment is the #rocess of determinin:

i. The income or the !oss of an assessee

ii. The tax !ia*i!it on the income so determined

iii. The tax #aa*!e * or ref&nd d&e to the assessee.Th&s, there are three staes in an assessment:

a. om#&tation of tota! income*. Determinin the tota! tax !ia*i!it on the tota! income

c. Determination of tax #aa*!e on amo&nt ref&nda*!e.

3. Assessment ear [section 2(9)]: Assessment ear means the #eriod of 12 months

commencin on the 1st da of A#ri! e"er ear. Th&s, assessment ear 21211

commences on 1stA#ri!, 21 and ends on 31st4arch, 211. This definition has to *est&died +ith the definition of 5Pre"io&s ear6 *eca&se income tax is chared for e"er

assessment ear on the tota! income of the #re"io&s ear.

7. Pre"io&s ear [section 2(37) and 3]: The definition can *e c!assified into t+o #arts:

8orma!!, the #re"io&s ear means the financia! ear #recedin the

assessment ear e.. for assessment ear 2111, the #re"io&s ear +i!!*e the financia! ear 291 i.e. the ear *einnin from 1729 and

endin on 31321.

In the case of a ne+! set *&siness the #re"io&s ear +i!! *e the #eriod*einnin from the commencement of that *&siness, ti!! the next fo!!o+in

31st4arch.

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Definition of indirect taxes:

1. &siness [section 2(7)]: &siness inc!&des an ser"ice, an trade, commerce or

man&fact&re, or an ad"ent&re or concern in the nat&re of ser"ice, trade,

commerce or man&fact&re, +hether or not the enaement in s&ch ser"ice, trade,commerce, man&fact&re, ad"ent&re or concern is +ith the moti"e to mae ain or

#rofit and +hether or not an ain or #rofit accr&es from s&ch ser"ice, trade,

commerce, man&fact&re, ad"ent&re or concern.

2. Dea!er [section 2(0)]: Dea!er means an #erson +ho, for the #&r#oses of or

conse;&entia! to his enaement in or, in connection +ith or incidenta! to or in the

co&rse of, his *&siness *&s or se!!s, oods in the state +hether for commission,rem&neration or other+ise and inc!&des:

A factor, *roer, commission aent or an other mercanti!e aent

An a&ctioneer +ho se!!s or a&ctions oods +hether actin as an aent or

other+ise A non resident dea!er

An societ, c!&* or other association of #ersons

3.