Main element constitute a business
S J Tubrazy
In order to constitute a business, there must be a continuous exercise of activity for the purpose of gain. This element of continuity is essential to constitute a business of investment. The reason for this condition is that in modern society people no longer hold their savings in gold or cash but are encouraged to invest their savings in property and securities, yet a man who invests his savings in buying a property would not be said to be carrying on a business if he lets out the property on rent, nor would a person who has purchased shares out of his savings be said to carry on business merely because he derives income from his investments. If, however, he regularly bays and sells property or shares, so as to make profit out of the fluctuations in the prices of property or shares, then it would be said that he was carrying on the business of investment, there is thus a fundamental distinction between the business of investment; and the purchase and sale of investments by a person. Even occasional speculation in shares does not amount to carrying on a business, therefore, a person, who buys property or shares and retains them for a long period of time, would not be considered to be carrying on the business of investment.