TMI Blog2013 (1) TMI 829X X X X Extracts X X X X X X X X Extracts X X X X ..... s return of income on 28-11-2007 declaring total income at Nil. During the course of assessment proceedings, it was noticed by the AO that the assessee society has received transfer premium on sale of flats aggregating to ₹ 19,75,000/- for the year under consideration. According to him, the said amount received by the assessee society on account of transfer premium was in violation of the relevant provisions of the Maharashtra Cooperative Societies Act which provides that transfer charges cannot be recovered beyond the limit of ₹ 25,000/- in case of each transfer and there was thus a profit motive behind the recovery of transfer charges made by the assessee society. He was also of the opinion that the contributors and the partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 414 wherein it was held that the amounts received by the cooperative housing society on account of non-occupancy charges are exempt from tax under the principle of mutuality. Aggrieved by the order of the learned CIT(Appeals), the Revenue has preferred this appeal before the Tribunal on the following grounds : 1. The Ld. CIT(A) erred in deleting the addition on account of transfer fees of ₹ 19,75,000/- following the decision of Hon ble High Court of Bombay in the case of M/s Suprabhat CHS and M/s. Shyam CHS wherein it has been held that all amounts received by the CHS on the grounds of transfer charges are exempt under the principle of mutuality. The decision has not been accepted by the Department and the issue is sub-judice. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the amount it would be in the nature of profit making that specific amount exigible to tax. Under the bye-laws, charging of transfer fees had no element of trading or commerciality. Since there was no taint of commerciality the question of earning profits would not arise when the assessee from the funds received applied the moneys received towards the maintenance of the society and providing the members with usual privileges, advantages and conveniences. Thus, the principle of mutuality was applicable to the assessee which had as its predominant activity, the maintenance of the property of the society which included its building(s) and as long as there was no taint of commerciality, trade or business, the receipt of transfer fees was not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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