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TMI Blog1993 (10) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... ing agent, constitute a profession within the meaning of Sub-paragraph II of Paragraph C of Part I of the First Schedule of the Finance Act, 1976, and the Finance (No. 2) Act of 1977 ? " The assessee is a registered firm. It is engaged in the business of clearing, forwarding and shipping of goods. The income of the assessee for the assessment year 1976-77 (the corresponding previous year being the accounting year ended on December 31, 1975), was Rs. 1,73,985. The income for the next assessment year 1977-78 (the corresponding previous year being the accounting year ended on December 31, 1976), was Rs. 3,70,659. The assessee claimed before the Income-tax Officer that its activities as clearing and forwarding agents amounted to a "profession" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carried on by it, if the income so included was not less than 51 per cent. of the total income of the firm. The rate of income-tax applicable to income of such firms ranged between 4 per cent. and 22 per cent. as against 5 per cent. and 24 per cent. applicable to other firms. Learned counsel for the Revenue submits that "profession" involves the idea of an occupation requiring purely intellectual skill as distinguished from an occupation which is substantially the production or sale or arrangements for the production or sale of commodities. Reference is made in this connection to the decision in IRC v. Maxse [1919] 12 ITC 41 (CA). According to learned counsel, the activity of a clearing, forwarding and shipping agent is nothing but a busi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be said to be engaged in the practice of a profession. The real job of a stockbroker is to make arrangements for sale of the shares or securities of others. Such activity clearly falls within the expression 'business' and not 'Profession'." It was further held (at page 101) : "The activity of a share broker is nothing but business activity Which falls within the expression 'business' as defined in clause (13) of section 2 of the Act, It does not fall within the expression 'profession' even if it is interpreted in the broader sense to include many of the activities which were earlier not included therein. A broker is not held to be engaged in the practice of a profession. . . ." In the above decision, this court also considered th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . I. Corporation, AIR 1993 SC 252 ; [1992] 81 FJR 387 (SC). The appellant in that case was engaged in the business of clearing and forwarding operations. It was also authorised to transact its business at the Cochin Custom House under the terms of section 202 of the Sea Customs Act and the Rules made thereunder. Licence was also issued under the said provision. The question arose whether the establishment of the appellant, who was carrying on the activity of clearing and forwarding operations, was a "shop" for the purpose of application of the Employees' State Insurance Act, 1948. The Supreme Court held as under (at page 258 of AIR 1993 SC) (at page 395 of 81 FJR) : "The appellant is carrying on stevedoring, clearing and forwarding operati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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