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TMI Blog2017 (5) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, we are of the considered view that the decision of the CIT (A) is fair and reasonable and it does not call for any interference. - Decided against revenue - I.T.A. No.5413/M/2014 - - - Dated:- 5-5-2017 - SHRI R.C. SHARMA, AM, AND SHRI RAVISH SOOD, JM For The Appellant : Shri Saurabh Kumar, Sr AR For The Respondent : Shri Gopal Bohra ORDER PER R.C. SHARMA, AM: This appeal is filed by the Revenue against the order of the CIT (A) for the AY 2010-2011, in the matter of order passed u/s 143(3) of the Act, wherein the Revenue has taken the following grounds:- 1. On the facts and in the circumstances of the case and in aw, the Ld CIT (A) erred in deleting the addition of ₹ 40,50,000/- being income from other sources‟ without appreciating the fact that any amount charged in excess of ₹ 25,000/- for each transfer is in contravention of the Notification of Government of Maharashtra, 2001 and the excess amount will be liable to tax and will not be covered under the concept of Mutuality. 2. On the facts and circumstances of the case ld CIT (A) erred in holding that the receipt of ₹ 40,50,000/- in nature of repair and mainten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epairs Maintenance Fund, and (iii) M/s Thakkars Investment Pvt. Ltd. of ₹ 10,00,0001- Total Rs.40,50,000/- 4. According to AO, the aggregate sum of ₹ 40,50,0001- as outlined above represented Transfer Fees in excess of limit prescribed by the Notification of Govt. of Maharashtra i.e. ₹ 25,0001- per flat. The AO stated that in the case of Sind Co-op. Housing Society the Hon'ble High Court of Mumbai held that any amount exceeding the prescribed limit of ₹ 25,0001- per flat is eligible to tax. According to AO, what the Hon'ble High Court considered in the said decision was that the transfer fees collected is not taxable as per notification of 1989, however the Hon'ble High Court had not considered the notification of 2001. From the above, the AO concluded that the findings of Hon'ble High Court proves beyond doubt that any amount exceeding ₹ 25,0001- is taxable, as there is profiteering involved in such amounts received. In the circumstances, the decisions based on the notification of 1989 in Shyam Co-op. Hsg. Society Ltd. Suprabhat Co- op. Hsg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Certificate. ii) The contention of appellant regarding contribution being covered under the concept of mutuality was acceptable, since there had been regular withdrawals from the fund to which contributions were made in same/ subsequent years, on account of amounts spent on painting, scalffolding, plumbing, and also professional fees paid to professional engineer for making major repairs. Therefore, the society was using the amounts contributed by members for common benefit of the society. iii) The issue of receiving voluntary contributions from outgoing/ incoming members was discussed in the General Body and was ratified by the members wherein it was decided that minimum contribution of ₹ 30,000/- for two bed room flat and ₹ 50,000/- for three bed room flat would be taken from outgoing/ incoming members, and there was no maximum limit imposed. Thus, the contributions had been received by the society in view of the authority given by the General Body and were according to Bye-laws of the society. iv) The contribution had not been received from incoming member on the condition of providing membership. i) In the case of Sind Co-op. Housing Socie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts of the case are identical to that in A. Y. 2009-10, I find no reason to deviate from the decision of my predecessor in said appeal, for the year under consideration. 16. While deciding a similar issue in the case of Mittal Court Premises Co-operative Society Ltd., it was clearly held by Hon'ble High Court of Bombay that Apart from that, even assuming that the Government notifications were applicable, if the society could not have charged excess amount, it would have to be refunded to the members. A member is not prohibited from gifting any amount to the society for the objects of the society. The principle of mutuality would not cease on account of those aspects. At the highest, authorities under the Co-operative Societies Act and Rules, if any action is taken, may direct an additional amount to be refunded. Therefore, in respect of contribution by way of non-occupancy charges, principle of mutuality would apply. Applying the same ratio to the Transfer Fees, the appellant society has not received any excess transfer fee, which it is liable to refund to the members. Instead, the voluntary contribution towards Repairs Maintenance Fund Members Lift Fund is for the o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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