What is Business?

Business [Section 2(4)]
Business includes
i. any service,
ii. any trade, commerce or manufacture or
iii. any adventure or concern in the nature of service, trade, commerce or
manufacture. It is not material whether such service, trade, commerce,
manufacture or adventure or concern may be carried on with a motive to make
gain or profit or without any such motive.
Business also includes transactions that are incidental or ancillary to such trade,
commerce, manufacture, adventure or concern.
Following shall also be considered as business
i. Activities like raising of man made forest or rearing of seedlings or plants
ii. Transactions of buying or selling of capital assets
iii. Any purchase debited or any sale of goods credited to the Profit and Loss A/c
are deemed to have been in the course of business (Eg. Sale of scrap)
iv. Transactions in connection with commencement or closure of business.
The above definition is an ‘inclusive’ definition. Hence, it is applicable in addition to
the normal meaning of the term.
The ‘normal’ meaning of the term business is the purchase or manufacture of goods
with the intention to finally sell it. This intention is the main factor in deciding whether
an activity can be called business or not.
MVAT Act, 2002 taxes all sale of goods in the course of business.