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TMI Blog2016 (3) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of any income at all. The society by itself does not have its own income. The expenditures are met by the contribution made by the members or member. Even if the member wants to have some extra facilities and the demand is supported by the remaining members the additional facilities can be erected only through the medium of co-operative society. A member of a housing society cannot incur any expenditure directly even though the expenditure was incurred for this personal benefit. The work has to be carried out through the office of the society. The society alone can undertake such work. Therefore, in fact even in a case where a personal benefit is given to amber by doing some work. The same work is done by the society for and on behalf o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Renovation in the balance sheet of the assessee. The assessee filed its return of income on 26.08.2006 at nil income and the same was processed under section 143(1) of the Act. Thereafter a notice u/s 148 of the Act was issued on 30.03.2012 and properly served on the assessee society and the assessment u/s 143(3) r.w.s. 147 of the Act was framed vide order dated 28.03.2013 at ₹ 70,06,000/- by adding ₹ 70,00,000/- received as voluntary donation besides making some other additions. The ld. AO added the same to the income of the assessee on the ground that society could not prove the intention of concept of mutuality and therefore, the donation received from Shri Kirit R. Jasani a member of the assessee society for repairs is non ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the appeal of the department be dismissed and the order of the CIT(A) which was rightly passed by following the decision in the above ITA deserved to be upheld. 5. We have heard the rival submissions and perused the material on record. We find that the issue involved in the appeal is covered directly by its own case in earlier year in ITA No. 467/Mum/2008 assessment year 2004-05 and relevant paras 9 to 14 are re-produced as under:- 9. We considered the matter in detail. As rightly pointed out by the learned counsel appearing for the Assessee a similar case was considered by the ITAT Mumbai A Bench in the case of Shree Parleshwar Co-operative Housing Society Ltd. Vs. ITO[8 SOT668(Mum.)]. In that case, the assessee-society had av ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctly observed. The application of funds is the crucial test. Here the fund of ₹ 1,75,00,000 was contributed by one of the members. How the funds were expended? The funds were expended in renovating and repairing the existing building facilities of which the benefits are available to all the members. Therefore there is no doubt that the expenditure incurred by the assessee-society is for the benefit of the entire members, and therefore, fully covered by the rule of mutuality. 11. Now regarding the source of funds utilized for the renovation work of the building one has to see that the contribution has come from a member. No outsider is involved. Whether the contribution has come from all the members from some of the members or on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imself to contribute ₹ 1,75,00,000 to undertake the repair work was in fact reimbursing the society of the expenditure incurred by the society. The society has incurred expenditure in expanding the facilities and in carrying out eh repair works. There was shortage of funds that shortage was made good by the member. So that is only a question of reimbursement or compensating the expenditure. Therefore as far as the assessee society is concerned. It has not earned anything. So there is no question of any income at all. The society by itself does not have its own income. The expenditures are met by the contribution made by the members or member. Even if the member wants to have some extra facilities and the demand is supported by the rem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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