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TMI Blog2019 (4) TMI 1433X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee in accordance with principles of natural justice in accordance with law. - ITA Nos.1037 And 1038/Mum/2018 - - - Dated:- 22-4-2019 - Shri Pawan Singh, Judicial Member And Shri Ramit Kochar, Accountant Member For the Appellant : Shri Shekhar A. Desai(CEO) And Shri G.G. Sathe, A.Rs For the Respondent : Shri V. Justin, D.R ORDER PER RAMIT KOCHAR,ACCOUNTANT MEMBER These two appeals filed by the assessee are directed against two separate appellate order(s) passed by learned Commissioner of Income-tax(Appeals)-2, Nasik (Camp Office Thane), Mahrashtra ( hereinafter called the CIT(A) ) dated 27.12.2017 and 07.11.2017 for assessment year(s)(AY) 2012-13 and 2013-14 respectively, which in turn arises from two separate assessment order(s) passed by learned Assessing Officer ( hereinafter called the A.O. ) both under Sec.143(3) of the Income tax Act, 1961 (for short I.T Act‟), dated 05.01.2015 and 14.03.2016 for AY 2012-13 and 2013-14 respectively. We shall first take up the appeal filed by the assessee for A.Y. 2012-13. Since, similar issues are involved in these two appeals filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case are that the assessee is co-operative society, engaged in the business of banking. The assessee is registered under The Maharashtra Cooperative Societies Act, 1960. The functions and operations of the assessee are regulated by the Reserve Bank of India vide its banking license u/s 22 of the Banking Regulation Act. During the course of assessment proceedings conducted by the AO u/s 143(3) read with Section 143(2) of the 1961 Act, it was observed by the A.O from the tax audit report filed by the assessee as per column No.13(d) which relates to amounts not credited to the Profit and Loss account i.e. Entrance Fee of ₹ 74,850/- was not credited to P L Account . The AO asked assessee as to why the said amount should not be treated as income of the assessee considering the same to be revenue in nature . The assessee in reply submitted as under: 10) Membership Fees of ₹ 74,850/- Entrance Fees of ₹ 23,960/- Particulars Ordinary Members Nominal Members No. of members as on 01.04.2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arose in AY 2007-08 and AY 2008-09 which went upto ITAT,Mumbai at behest of the assessee and tribunal was pleased to set aside and restore the matter back to the file of the A.O for de novo determination of the issue . The finding of learned CIT(A) while deciding appeal for the impugned assessment year AY 2012-13 vide appellate order dated 27.12.2017, is as under: 6.2. I have gone through the facts of the case. Similar issue was decided by my predecessor in the case of the assessee for AY 2009-10 and 2010-11, vide order dated 25.07.2014 which is reproduced as under. I have carefully considered the facts on record and submission of the appellant. I find that the Membership and Entrance fees has been collected @ ₹ 50/- from new ordinary members and ₹ 20/- from new nominal members. This collection of fees is in addition to the amount collected for allotment of the shares. In fact, the Membership fees and Entrance fees are in the nature of charge for application forms and processing of application, etc. which are received in the normal course of business of the appellant. The fees so collected is not required to be refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers were inducted and there are various rights got vested in person on becoming member of the assessee. The learned counsel for the assessee drew our attention to clause 9 of bye laws which dealt with members and it was explained that on becoming member of the assessee, several valuable rights such as right to attend AGM, right to vote etc get vested in member and hence these receipt are capital receipts not exigible to tax. It was explained by learned counsel for the assessee that similar issue arose for AY 2007-08 and 2008-09 wherein Mumbai ITAT was pleased in ITA No. 7114/Mum/2010 and 7006 /Mum/2011 for AY. 2007-08 and 2008-09 respectively vide common dated 11.07.2012 to restore the matter to the file of the A.O for fresh adjudication . On being asked by the Bench, the learned counsel for the assessee stated that the AO has not yet framed denovo assessment for AY 2007-08 and 2008-09 as of date although details were submitted by the assessee on 3rd August 2012 and followed up with further communication lastly on 14th October 2016 . It is also explained that the assessee is consistently following with the AO orally but as of date no denovo assessment has been framed by the AO. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the details were not furnished before the AO about the nature of membership granted and whether the shares were allotted or not, the issue cannot be decided only on the nomenclature of the amounts in books. We also notice that any member at the time of admission should subscribe to 40 shares of ₹ 25/- each which means the amount of membership fees per member should be ₹ 1000/- whereas the entrance fees per member was only ₹ 50/- ( ie. 1000:50). When this question was placed before the Ld Counsel, why there is a membership fees of ₹ 65,340/- and ₹ 54,680/- only when entrance fees was at ₹ 1,78,780/- and ₹ 1,51,650/-, which does not tally with the ratios prescribed in the bye-law, he could not explain. Assessee has no objection if this aspect also was examined by the AO. Since the very nature of the amounts received could not be reconciled before us, we were unable to give any finding whether the membership fees or entrance fees accounted as such in the books of account was capital receipt or revenue receipt. Therefore, in the interest of justice, we restore the issue to the file of the AO to examine the nature of receipt of these amounts and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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