Dalali receipts treated as business income, not professional income, denying concessional tax treatment to the firm.

Dalali income was held to be business income, not professional income, because the ordinary meaning of "profession" requires an occupation involving specialised intellectual skill, or manual skill controlled by intellectual skill, acquired through training, study, or practice. The assessee's activity of matching borrowers and lenders was commercial in nature, and there was no material showing that its partners or employees possessed specialised or skilled intellectual knowledge. As a result, the firm could not claim the concessional taxation available to a registered firm deriving income from profession, and the issue was decided against the assessee.

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Issues: Whether dalali income earned by the assessee firm was income derived from a profession so as to qualify for concessional taxation applicable to a registered firm deriving income from profession.

Analysis: The inclusive definitions of "business" and "profession" in section 2 of the Income-tax Act did not resolve the distinction, so the ordinary meaning of "profession" had to be applied. A profession was treated as an occupation requiring specialised intellectual skill, or manual skill controlled by intellectual skill, acquired through training, study, or practice. The assessee carried on matching of borrowers and lenders, but there was no material to show that the partners or employees possessed any specialised or skilled intellectual knowledge. The services rendered were commercial in nature and not professional services.

Conclusion: The dalali receipts were income from business and not from profession, and the concessional rate for firms deriving professional income was not available; the issue was decided against the assessee and in favour of the Revenue.

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