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1971 (9) TMI 59 - ANDHRA PRADESH HIGH COURT
Surplus of income over expenditure of a recreation club providing amenities to members on payments - " Whether, on the facts and circumstances of the case, the assessee-club is entitled to exemption from income-tax in respect of its income for the assessment year 1961-62 ? " - Since the club has not been formed for the purpose of making profits by trading, it is not a trade association. The surplus of receipts over expenditure derived by the assessee-club does not go to any person in the capacity other than as contributor or consumer. Therefore, the assessee club is not a trade association nor is the excess a profit taxable as income from other sources - Surplus received by the assessee-club is not income. It is therefore, not taxable either under section 10 as business income or under section 12 as income from other sources.