Sharebroking is business, not profession, for income-tax purposes, so lower surcharge relief for professional firms is unavailable.

Under the Income-tax Act, "profession" is distinct from "business" and the two operate in mutually exclusive fields. A sharebroker or stockbroker mainly arranges transactions in shares and securities, which is commercial dealing and not a profession unless the activity involves specialised intellectual skill and a vocation of that character. On the admitted facts, the registered firm's sharebroking activity did not meet that test, so it could not claim the lower surcharge rate available to firms carrying on a profession. The question was treated as a question of law and was therefore open to reference.

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Issues: Whether the activity of a sharebroker carried on by a registered firm constitutes a "profession" for the purpose of computation of tax liability and entitlement to the lower rate of surcharge.

Analysis: The expression "profession" under the Income-tax Act is distinct from "business", and the two are used in a mutually exclusive sense. A stockbroker or sharebroker primarily arranges sales of shares and securities of others, which is an activity falling within business rather than a profession. The broader meaning of profession still requires an element of specialised intellectual skill and a vocation different from mere commercial dealing. On the admitted facts, the assessee's activity did not answer that description. The issue was treated as a question of law, not a pure question of fact, and was therefore open to reference.

Conclusion: The assessee's sharebroking activity was not a profession, and the Tribunal was wrong in granting the benefit applicable to firms carrying on a profession.

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