9911796707
TMI Blog1987 (3) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... categories: (i) other co-operative societies of teachers, and (ii) individual teachers. The assessee gets text books from the Government at concessional rates and sells them to any person who buys them as also to the members of the society at a discount. During the assessment proceedings, the stand of the assessee was that the profits earned by sales to the members of the society was not taxable as it was not the income of the society. The surplus from trading with members had been arrived at by taking proportionate profit on sales to the members. The surplus worked out, as mentioned above, in the three years is under consideration. The claim of the assessee was rejected at all stages. Hence, the present references under section 256(1) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rious categories of persons. It sells to members and to the whole world. Every sale involves some profit. The assessee is obviously, therefore, a trading society aiming at increasing its profit. In this case also, therefore, there is no identity between the contributors and the participators. The participators in the profits are only members but the contributors are every individual who may buy from the assessee. Obviously, therefore, this case stands on the same footing as the case of Jamshedpur Co-operative Stores Ltd. [1986] 157 ITR 127 (Pat). Learned counsel for the assessee contended that so far as the trading activities between the society and non-members are concerned, there was certainly no mutuality and to that extent the profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith members. With respect, I have some difficulty in accepting this proposition as correct. The parameter of mutuality was laid down by the Supreme Court in the cases of CIT v. Royal Western India Turf Club Ltd. [1953] 24 ITR 551 (SC) and CIT v. Kumbakonam Mutual Benefit Fund Ltd. [1964] 53 ITR 241 (SC). In none of those cases, the Supreme Court laid down the principle of dissection of income derived from trading with members and non-members. In that view of the matter, we are unable to accede to the submission made on behalf of the assessee that the income derived from trading with members cannot form part of the taxable income of the assessee. In our view, therefore, the Tribunal was justified in holding that the sums of Rs. 5,800, Rs. 2, ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
