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Both the phrases “association of persons & body of individuals” are considered identical in the ordinary living. However both the terms have there own different compositions and meaning which needs to be understood for its distinction.

  • Association of persons:

The Income Tax Act does not define the meaning and definition of AOP. In the absence of any definition under the Income Tax Act, the words must be read in their plain ordinary meaning. “AOP means two or more personas who join for a common purpose with a view to earn an income. It need not be on the basis of a contract. Therefore, if two or more persons come together to carry on a business but do not constitute a partnership, they may be assessed as an Association of persons.


  • Body of Individuals:

It means a conglomeration of individuals who carry on some activity with the objective of earning some income. It would consist only of individuals. Entities like companies or firms cannot be members of a body of individuals.


To summarize:


  Association of persons

Body of Individuals

1. It may consist of non individuals   ( firm, company, HUF etc.)


For Eg: If ABC Ltd. and XYZ Ltd.(a firm) join together for a particular  venture they may be referred as an AOP

 It has to be of individuals only.



For Eg: If P,Q and R join  together for a particular venture but do not constitute a firm then they may be referred as a BOI.

2. An AOP implies a voluntary getting together for a common purpose.

BOI may or may not have such common purpose. For instance, if a group of people are travelling in a train, or waiting for a bus at the bus stop, they might be a group of people or in the literal sense a “body of individuals”. However, they’re not an AOP (association of persons) in a legal sense.

-Maitri  Badani

 ( Artical Assistant )


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