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2016 (4) TMI 743 - BOMBAY HIGH COURTAddition on contribution from the members - taxability of excess of income over expenditure - application of doctrine of mutuality - Held that:- The contributions made by the members to the respondent-assessee cannot be a subject matter of tax merely because the part of its excess of income over expenditure is invested in mutual funds. It is also not the case of the Revenue that the dividend received from mutual funds have not been offered to tax by the respondent-assessee. The concept of Mutual concerns not being subject to tax is based on the principle of no man can profit out of itself. In this case it is not disputed that the income earned on account of investments made in Mutual Funds has been offered to tax. The respondent has in effect followed the decision of the Apex Court in Bangalore Club, however as held in Bangalore Club (2013 (1) TMI 343 - SUPREME COURT ), it cannot result in the respondent being charged to tax on the contribution received from its members. In fact the decision of this Court in Common Effluent (2010 (6) TMI 52 - BOMBAY HIGH COURT ) concludes the issue in favour of the respondent assessee.
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