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TMI Blog2012 (6) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... f quality tyres, automobile spares, etc., to the members. Admittedly, the respondent is not engaged in any trade other than purchase and distribution of tyres, automobile spares, etc., to its own members. In other words, the contributors of the respondent are the beneficiaries or participants of the benefits derived by the association. Even though the respondent claimed exemption from payment of income-tax on the profit derived by it, by claiming the principle of mutuality, the Assess- ing Officer held that the assessee-association is not entitled to exemption because the surplus derived by it amounts to business income falling under section 28(iii) of the Income-tax Act. Assessments involved in these cases are for the years 2001-02, 2002-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rinciple of mutuality applies is whether the contributors to the club or the organisation are the participants in the benefit derived from it. Admittedly, the beneficiaries of the little profit derived by the respondent-association as in the case of the clubs are the members. In other words, the purchases made by the members lead to profit to the association which in turn goes to the members or for their own benefit. In our view, the principle of mutu- ality squarely applies to the case of the respondent-association for the transactions carried on by them. So much so, we do not find any ground to deviate from the view taken by the Tribunal following consistent decisions of the Supreme Court in several cases relied on by the Tribunal, partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifically extended to a particular member or members against specific charges received. In our view, the Department has no case that besides the purchase and distribu- tion of automobile tyres, spares, etc., by the association to its members, the respondent-association is not involved in rendering any specific service to any particular member or members and they have also not charged any amount for any specific service from any member or members. So much so, in our view, the above provision does not apply to the facts of this case. The only other exception for assessment of mutual benefit concerns is only the income falling under section 2(24)(vii) which provides for assessment of profits and gains of any business of insurance carried on by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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