Table of Contents
1. How is the residential status of firms/AOP/BOI/Local authorities/artificial juridical person (AJP) decided?
- A Firm/AOP/BOI/Local authorities or AJP is said to be a resident in India if the Control and Management of its affairs are wholly or partly situated within India during the relevant previous year.
2. What is meant by Control and Management?
- Control and management refers to a place where key business & commercial decisions are taken
- Such decisions need not necessarily be taken from the place of business or registered office.
- It is to be noted that the place where such key business & commercial decisions are taken is deemed to be the place where the control and management is situated.
3. Does the term Firm include Limited Liability partnerships?
- As per section 2(23) of the Income Tax Act, 1961, the term firm shall include a limited liability partnership as defined in the Limited Liability Partnership Act, 2008.
4. What is the difference between association of persons and body of individuals?
- Association of Persons (AOP) means a group of persons who come together for achieving a common objective and have the same mindsets. Members of the AOP can be natural or artificial persons. Body of Individuals (BOI) means a group of individuals (natural persons) who join together for earning income
- However, for the purpose of income tax, AOP and BOI are considered one and the same
5. Whether an AOP/BOI/Local authority/AJP can be considered as person if established for not for profit purpose?
- As per the explanation to section 2(31) of the Income tax Act, 1961, an AOP/BOI/Local authority/AJP shall be deemed to be a person whether or not formed or established with the object of deriving income, profits or gains.
6. Are universities considered as persons for the purpose of income tax act, 1961?
- Yes, universities are artificial juridical persons
- Hence, they are considered as person for the purpose of income tax act, 1961.
- Other examples of artificial juridical person are