1. Fundamentals of Taxation Income from Business or Profession Section 28 & 29
Business is defined by Sec. 2(14) as including “any trade, commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture”. “Profession involves the idea of an occupation requiring either purly intellectual skill, or if any manual skill, as in painting and sculpture, or surgery, skill controlled by the intellectual skill of the operator, as distinguished from an operation which is substantially the production or sale, or arrangements for the production or sale of commodities’ It is not necessary to consider whether a particular activity amounts to business or profession or vocation, since for the purpose of assessment under the Ordinance profits from these three sources are treated and taxed alike under the same head. The section uses here only the words business” or “profession” since “profession” includes vocation under the Ordinance. Sec.2(49)

2. Fundamentals of Taxation Income from Business or Profession Section 28 & 29 Definition Sec.28(1).
The following income of an assessee shall be clasified and
computed under the head”Income from business or
profession” namely
(a). Profits and gains of any business or profession carried on, or deemed to be carried on, by the assessee at ant time during the income year;
(b). Income derived from any trade or professional association or other association of like nature on account of specific services performed for its members;
( c). Value of any benefit or perquisite, whether convertible into money or not, arising from business or the exercise of a profession;

3. Fundamentals of Taxation Income from Business or Profession Section 28 & 29 Definition Sec.28(1).
(d). Receipt back of loss, bad debtor expenditure and unpaid trading liability as referred to in Sec.19(15)
(e). Income from sale of depreciated asset as referred to in sec19(16).
(f). Income of receipt of insurance, salvage or compensation moneys as referred to in Sec.19(18).
(g). Income from sale of asset of capital nature as referred to in Sec. 19(20).
(h). Income from transfer of export quota as rerred to in Sec. 19(23)

4. Fundamentals of Taxation Income from Business or Profession Allowable Deductions Sec. 29
As per the provisions of the ordinance, tax is lavied on the net profit earned out of any business or profession. The expenditures , deductable for determining the amount of net profit are not defined elaborately. A few heads of expenditures have been specified under Sec. 29(1)(i) to Sec. 29(1)(xxxi). In practice many other can be claimed as admissible expenditures under clause 29(1)(xxvii)which is generally known as “omni-bus” clause. Clause 29(1)(xxvii) “ Any expenditure, not being in the nature of capital expenditure or personal expenses of the assessee laid out or expended wholly and exclusively for the purpose of the busine or profession of the assessee”

5. Fundamentals of Taxation Income from Business or Profession Allowable Deductions Sec. 29
Clause (i) to (xxxvii) of Sec.29(1) of the Ordince expressly provide for certain deductions. These provisions for deductions should not be liberally construed(New Shorrock Sp. & mfg. co. ltd. V. C.I.T.[1956]30 I.T.R Before dealing with the express allowances, it will be convenient to note certain general principles regarding allowances and deductions permissible in computing business profit. The Supreme Court of India in the case of C.I.t. v. Malayalan Plantations Ltd.[1964]53 I.T.R. 140 held that the expression “for the purpose of business “ is wider in scope than the expression “for purpose of earning profits”. It was held that the expression “for the purpose of business” may take in not only the day to day running of the business , but also the rationalisation of its administration and mordinasation of its machinery. It may include measures for the preservation of and for the protection of Its assets. It was further held that the expenditure shall be for the purpose of the business, that is to say, the expenditure incurred shall be for the carrying on of the business and the assessee shall incur it in his capacity as a person carrying on the business case