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2014 (4) TMI 304 - AT - Income TaxNature of income – Principle of Mutuality - Exemption to income from house property - Whether exemption to income from house property is to be allowed on the principle of mutuality or to be taxed under that head – Held that:- As decided in assessee’s own case for the earlier assessment years, it has been held that, The main reason for rejecting the claim of the assessee was that the assessee has not fulfilled the condition regarding distribution of surplus assets only amongst the members of the association on its dissolution - In the absence of clear cut provisions for distribution of surplus, claim of the assessee on both the grounds of appeal was rejected - The assessee has however, modified the bye-laws by adding clause 9 (A) referred to above which was accorded sanction by Director of Sugar, Gandhinagar and accordingly it was put in form No.4 also – the papers were not before the AO for consideration –The issue of mutuality is primarily restored to the file of AO for Asst. Years 2003-04 to 2005-06 - then following the same the issues arising in Asst. Year 2006-07 are required to be remitted back to the AO for fresh adjudication after considering the amendment in the constitution, whether it is a retrospective and accordingly it would be applicable to earlier years – Decided in favour of assessee.
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