The definition of "business" given u/s 2(17) of the Proposed GST Act, 2016 runs as under:-
2(17). "business" includes-

(a)

any trade, commerce, manufacture, profession, vocation, adventure, wager or any other similar activity, whether or not it is for a pecuniary benefit;

(b)

any activity or transaction in connection with or incidental or ancillary to (a) above;

(c)

any activity or transaction in the nature of (a) above, whether or not there is volume, frequency, continuity or regularity of such transaction;

(d)

Supply or acquisition of goods including capital assets and services in connection with commencement or closure of business;

(e)

Provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members, as the case may be;

(f)

admission, for a consideration, of persons to any premises; and

(g)

Services supplied by a persons as the holder of an office which has been accepted by him in the course or furtherance of his trade, profession or vocation;

(h)

Services provided by a race club by way of totalisator or a license to book maker in such club.

I. ANALYSIS OF THE DEFINITION-

A Critical analysis of the definition of "business" reveals the following:-
The definition is enumerative and not exhaustive as it used word "includes". When a particular definition "includes" certain things it is bring in other matters that would not properly come within the ordinary connotation of the word or expression or phrase in question. In the definition of business the word "includes" has been held as equivalent to mean. [AIR 1968 Raj 70 at Page 71 Chhuran Lal v/s State.]

The word "includes" in a statutory provision is designed to expend its scope [AIR 1994 Guj 130 Competent Authority v/s State.] In the statutory definitions it is generally used to enlarge the meaning of the preceding words and it is by way of extention and not with restriction. [AIR 1992 SC 129 at Page 131 Regional Director v/s High Land Coffee Works.]

The Hon'ble Calcutta High Court considered that the definition of a effect clause, beginning with the word "include" is not to single out for specific mention some of the things comprised within the natural import of the terms defined but effect is to enlarge that import by the addition of certain things, which would not otherwise be regarded as included. It is undoubtedly true that a definition clause, so expressed, is ordinarily not exhaustive, it can be so in certain context. [AIR 1957 Cal Page 270 Tarak Chandra v/s Ratan Lal.]

II. BUSUNSESS - MEANINGOF-

In ordinary meaning of business means, a person's regular occupation, profession, or trade, an activity that some one is engaged in. In a mercantile meaning, a business is an organizational entity involved in the provision of goods and services to consumers.

The levy of the tax directly pertains to business. The definition of "business" is therefore fundamental to the liability clause. The word "business" is as has often been said one of wide import and in fiscal statutes, it must be construed in a broad rather than a restricted sense. [AIR 1958 SC 861 Mazagaon Dock Ltd. v/s Commissioner-SC.]
It connotes some real substantial and systematic or organised course of activity or conduct with a set purpose. [AIR 1955 SC 176 at Page 181 Narain Swadeshi Weaving Mills v/s Commissioner of Excise].

The word "includes" makes the definition susceptiable to other construction as become imperative for the purpose of adding to the natural significance of the word "business".

The Hon'ble Supreme Court held that "business" is very wide term and would include anything which occupies the time, attention and labour of a man. [AIR 1989 SC 1988 Sedan Singh v/s New Delhi Municipal Committee]. It is also held that "business" is much wider than trade. [AIR 1978 Mad 46 at Page 48 B.C. Murirathinam v/s Meena Financieries].

III. SCOPE for IMPORT OF THE BUSINESS-

The scope and import of the expression "business" is explained fully by the Hon'ble Supreme Court in the case of State of Gujarat u/s Raipur Manufacturing Co. Ltd. 1967 SC 19 STC I at Page 6 (S.C.) which is as follows:-
"The expression "business" through extensively used is taxing statutes is a word of indefinite import. In taxing statutes it is used in the sense of an occupation or profession which occupies the time, attention and labour of a person normally with the object of making profit. To regard an activity as business there must be a course of dealings. Either actually continued or contemplated to be continued."

The word "Commerce" has also not been defined under proposed GST Law, 2016, so one has to depend upon dictionary meaning and on rulings/Verdicts given by different courts of the country. "Commerce" involves the transfer of the ownership of goods or services, from one person or entity to another, in exchange for money, goods or services.

A Commercial venture means investment of capital or any work and a risk of profit or loss runs with it. Word "Commerce" not only includes transactions or purchase, Sale and exchange of articles but also includes instrumentalities and agencies by which it is promoted and the means and equipments by which it is carried on and the transaction of person as well as goods both by land and sea (please see Black's Dictionary Page 336).
According to chambers, Twentieth Century Dictionary, "Commerce" means interchange of merchandise on a large scale, between nations or individuals, extends trade or traffic, inter course.

The word "Commerce" has different shades of meaning [1969 23 STC 468 G R Kulkarani v/s CST (MP)]. In Conventional Sense whatever capital is to be laid out on any work, and a risk run of profit or loss, it is commercial venture [1848-6 Moore PC 413. Key v/s Ruthor Ford].

In other sense "Commerce" means exchange of merchandise especially on a large scale between different countries or districts, [Reader's Digest Dictionary, Vol I Page 186] but in this sense, commerce includes not only the purchase, sale and exchange of commodities, but also the instrumentalities and agencies by which it is promoted and the means and appliances by which it is carried on and the transportations of persons as well as goods both by land and sea.
   The Hon'ble Supreme Court held that in industrial legislation an activity is commercial when it is systematically and habitually under taken for production or distribution of goods or for rendering services to the community or any part of community with the help of employees in the manner of a trade or business [AIR 1969 SC 63 Dr. D.M. Surati v/s State of Gujarat (SC)].
In common parlance, trade and commerce carry with them the idea of purchase and sale with a view to make profit. If a person buys goods to sell them for profit, it is an ordinary case of trade. If the same activity is on a large scale, it is called commerce. However no body can define the volume of business, which would convert a trade into commerce [1954 5 STC 216 at Page 244 Gannon Dunkerlay & Co. v/s State of Madras (Mad. H.C.)]

Although the word "manufacture" is not defined under proposed GST Act, 2016, but u/s 2(63) "manufacturer" is defined as under:-

2(63). "manufacturer" shall have the meaning assigned to it by the Central Excise Act, 1944 (1 of 1944).
The above definition is borrowed from the Central Excise Act, 1944. Here it is pertinent to mention the definition given u/s 2(f) of the Central Excise Act, 1944 (CEA) which runs as under:-
(f) "Manufacture" includes any process,-

(i)

Incidental or ancillary to the completion of a manufactured product;

(ii)

Which is specified in relation to any goods in the section or chapter notes of the first schedule to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to manufacture; or

(iii)

Which, in relation to the goods specified in the third schedule, involves packing or repacking of such goods in a unit container or labeling or re-labeling of containers including the declarations or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer, and the word. "Manufacturer" shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his account.

The term "Manufacture" must be examined in the light of the definition given in the relevant statute.
The Hon'ble Jharkhand High Court, Ranchi also held that meaning of manufacture to be based on definition of term in respective statute [(2005) 138 STC 121 Steel India v/s State of Jharkhand].
As per section 2(f) of the Central Excise Act, 1944 "manufacture" includes any process -

(i)

incidental or ancillary to the completion of a manufactured product And

(ii)

which is specified in relation to any goods in the section or chapter notes of the Ist schedule to the Central Excise Tariff Act, 1985 (CETA), as amounting to manufacture (deemed manufacture) oR

(iii)

Which in relation to goods specified in 3rd schedule of CETA involves packing or repacking of such goods in a unit container or labling or re-labling of containers including declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer (deemed manufacture)

A raw material supplier is not a manufacturer since he does not carry out any manufacturing activities. Where a company outsources a job to a third party (job-worker) for converting a raw material into an excisable product, the third party, and not the company, is considered as the manufacturer.
Here it is noticiable that the Central Excise Duty can be levied in the hands of a manufacturer irrespective of ownership of materials. Thus, the job-worker is liable to pay excise duty although he is not the owner of the finished product.
For example, Mr 'K' is the owner of raw material. He supplied the raw materials to the household ladies, who are manufacturing the dhoop, agarbatties etc. in their houses. There was no control/supervision over their work and payment to them was on the basis of number of pieces manufactured. It was held by Supreme Court that the household ladies (Not Mr K) were the manufacturers. [See CCE v/s M M Khambhatwala (1996) Supreme Court].
If goods are manufactured outside the Indian territorial waters but within 150 nautical miles from the shore line, then Central Excise Duty is attracted.