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2017 (5) TMI 68 - AT - Income TaxInterest earned on Fixed Deposits with bank - taxability - interest received from non-members - principle of mutuality - Held that:- There is no dispute that assessee is allowed the benefit of mutuality to the extent of incomes earned amongst the members. The issue is with reference to the interest earned from the bank which is not a member of the Society. As in assessee’s case, the bank is not even a member of the society. The nature of the transaction between the assessee and the bank would disqualify application of the principle of mutuality. Therefore, the transactions with the bank who is not even a member of the society cannot be considered as a transaction for which principles of mutuality will apply. Not only on the principles laid down in the subject but also on the fact that the interest was received from a non-member, the principles of mutuality do not apply. The orders of the AO and CIT(A) are accordingly upheld both on facts as well as on principles of law. Find no merit in assessee’s grounds and accordingly, the same are dismissed.
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