9911796707
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Issues: Tax liability under section 10(6) for income received by an association from its members.
Analysis: The judgment pertains to a reference challenging a Tribunal order that held the income earned by an association liable to tax under section 10(6). In a prior judgment, it was established that the income of the association was taxable under section 12. The critical issue in this case is whether the association rendered specific services to its members and received remuneration for those services, as required by section 10(6) for tax liability. The Tribunal claimed that services were provided during rationing days, but the judgment highlights the lack of evidence supporting this assertion. The Tribunal failed to establish that remuneration was paid for services rendered by the association, rendering the tax liability under section 10(6) unsustainable. The judgment emphasizes the principle that if an entity is not liable to tax under one provision, but liable under another, the liability must be based on clear facts. In this case, the association was previously found liable under section 12, and the judgment questions the possibility of altering this stance. The re-formulated question in the judgment seeks to determine whether the receipts in question were properly taxed, to which the answer was affirmative. The judgment concludes by holding that the Department should bear the costs of the reference, considering the justification of the assessee in challenging the tax assessment under section 10(6. In summary, the judgment clarifies the requirements for tax liability under section 10(6) and emphasizes the necessity of establishing specific services rendered by an entity and remuneration received for those services. It also underscores the importance of factual clarity in determining tax liability under different provisions of the law.
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