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TMI Blog1984 (11) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... from business' and not under the head 'Income from house property'. The relevant facts are that the assessee-association has purchased a flat and let it our to Secretary General and claimed before the ITO that the income of Rs. 19,415 as estimated by the ITO is not the income assessable under the head 'Property income', but that is a business income. The assessee claimed that it is incidental to the business. Therefore, it should not be assessed under the head 'Income from property'. The ITO did not agree with the claim of the assessee. He estimated the income, form the property and estimated it at Rs. 19,415 in the asst. yr. 1976-77 and Rs. 4,250 in the asst. yr. 1978-79. Being aggrieved, the assessee carried the matter before the CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bject behind the purchase of the flat was not to earn income from this property and when there is no contrary decision cited by the Departmental Representative against the decision in CIT vs. Delhi Cloth & General Mills (1966) 59 ITR 152 (Punj) and Hoshiarpur Electric Supply Co. vs. CIT (1961) 41 ITR 608 (SC). Following the ratio in the decisions of their Lordships, we confirm the view taken by the CIT(A). 5. The next issue for our consideration in these appeals is whether the CIT(A) has erred in deleting the addition of Rs. 2,37,100 (asst. yr. 1976-77) and Rs. 7,40,500 (asst. yr. 1978-79) in respect of contribution received towards the building fund treating the same as capital receipts. The relevant facts are that the assessee-associati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee and the Tribunal reversed the view taken by the CIT(A) and sent the matter back to the CIT(A) that the principle of mutuality is not applicable in the sent that matter back to the CIT(A) that the principle of mutuality is not applicable in the case of this assessee. However, it is to be seen that contributions received towards purchase of flat and for the office would be of capital nature or not. As the CIT(A) has not gone into this question, the matter was considered in the light, whether the contributions received towards purchase of flat and purchase of office building for the association, the CIT(A) has considered the decisions on CIT vs. Poona Electric Supply Co. Ltd. (1946) 14 ITR 622 (Bom), E.D. Sassoon & Co. Ltd. & Ors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 78-79. Therefore, the principles of those case are not applicable. 7. We have heard the rival submissions and considered the material on record. It is true that the facts are not identical as in the cases of Hoshiarpur Electric Co. and Pune City Electric Co., as the contribution there was under the statute. But the basic thing to be seen is, at the time of receipt, what was the exact nature of receipt, contribution of the subscription was made under the resolution passed by the Association to purchase the flat and the office premises. The flat and office premises are the capital assets and contribution received towards that should be taken as capital receipt. Therefore, on the date of receipt, contribution received towards the capital ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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