9911796707
|
Home
Issues involved: Determination of taxability of amount received under caption 'contribution to common amenities' u/s principles of mutuality.
The appellate tribunal, ITAT Mumbai, in the case of an appeal by the assessee society, addressed the limited issue of the nature of the amount received under the caption 'contribution to common amenities.' The assessee contended that it is not taxable u/s principles of mutuality, while the Assessing Officer and CIT(A) argued otherwise, limiting mutuality to transfer and maintenance fees only. During the hearing, the assessee's counsel referred to a recent decision of the Tribunal in the case of M/s. Abhilasha CHS Ltd., where it was held that the impugned receipts should be considered akin to transfer fees, and since the amount is used exclusively for the society members' benefit, principles of mutuality apply, rendering it non-taxable under the Income Tax Act. The learned DR, however, failed to present any contradictory decision to challenge the applicability of mutuality to the amount received as contribution to common amenities funds. After careful consideration, the tribunal accepted the assessee's argument that the amount received as contribution to common amenities fund is utilized for the common members' benefit, thus attracting the principles of mutuality. Therefore, the tribunal held that the impugned amount is exempt from tax, allowing the appeal filed by the assessee. The judgment was pronounced in the open court on the date of the hearing, i.e., on 10.1.2011.
|
