A person includes an individual, Hindu Undivided Family (HUF), Association of Persons (AOP), Body of Individuals (BOI), a firm, a company etc. elaborate

 Under the Income Tax Act, 1961 of India, the term "person" is defined in a broad and inclusive manner to ensure that all entities and individuals earning income can be brought under the tax net. This definition is given in Section 2(31) of the Act.

Definition of Person [Section 2(31) of the Income Tax Act, 1961]

A "person" includes:

  1. An Individual

    • A single human being who may be a resident or non-resident, male or female, minor or major.

    • Example: Mr. Rajesh Sharma filing his personal income tax return.

  2. A Hindu Undivided Family (HUF)

    • A family consisting of all persons lineally descended from a common ancestor, including their wives and unmarried daughters.

    • It is treated as a separate tax entity.

    • Example: The Mehra HUF earning rental and business income is taxed separately from its individual members.

  3. A Company

    • Includes both Indian and foreign companies.

    • A company is a separate legal entity under the Companies Act, and it is taxed as a distinct person.

    • Example: Infosys Ltd., Tata Motors, Microsoft India Pvt. Ltd.

  4. A Firm

    • Refers to partnerships and Limited Liability Partnerships (LLPs) recognized under the Partnership Act or LLP Act.

    • The firm is assessed separately from its partners.

    • Example: M/s Kapoor & Co., a partnership firm of chartered accountants.

  5. An Association of Persons (AOP)

    • Two or more persons voluntarily coming together to carry on a common purpose or venture with an intention to earn income.

    • Example: A group of friends investing in a real estate project and sharing profits.

  6. A Body of Individuals (BOI)

    • A collection of individuals who join together for a common purpose (often not to earn profit).

    • Usually applicable in cases like lottery winners or legal heirs receiving joint property income.

    • Example: Legal heirs receiving rental income from jointly inherited property.

  7. A Local Authority

    • Includes Panchayats, Municipal Corporations, and similar governing bodies.

    • Example: The Municipal Corporation of Delhi (MCD).

  8. Every Artificial Juridical Person

    • Any entity not covered above but recognized by law as a person.

    • Example: Deities of temples, trusts, or universities not falling under any previous category.

Why This Broad Definition?

  • To bring various income-earning entities under the purview of taxation.

  • To ensure comprehensive coverage of the tax base.

  • To assign appropriate tax rates, exemptions, and filing requirements for each category.

Summary Table: Types of "Persons" Under the Income Tax Act

S.No Category Example
1 Individual Salaried employee, businessman
2 Hindu Undivided Family (HUF) Joint Hindu family earning business income
3 Company Infosys Ltd., Google India Pvt. Ltd.
4 Firm M/s Agarwal & Sons (Partnership/LLP)
5 Association of Persons (AOP) Joint investors in a venture
6 Body of Individuals (BOI) Legal heirs earning income jointly
7 Local Authority Municipal Corporation, Gram Panchayat
8 Artificial Juridical Person Registered charitable trust or university


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