TMI Blog1967 (6) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... 3-6-1967 - Judge(s) : P. JAGANMOHAN REDDY., SAMBASIVA RAO. JUDGMENT The judgment of the court was delivered by JAGANMOHAN REDDY C.J.-The Income-tax Tribunal has referred the following question for the opinion of this court, viz. : " Whether the income of the assessee-company is exempt from tax ? " This question arose in the following circumstances : The assesse, which is a public li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se stated that this claim was based on the rule of mutuality on the ground that the surplus accruing to a mutual concern could not be regarded as income, profits or gains, for purposes of the Income-tax Act. The Income-tax Officer rejected the claim of the assessee on the grounds : firstly, that as the assessee was a public limited company, it was a separate and distinct juristic entity independen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anent Fund Ltd. a Full Bench of the Madras High Court expressed disagreement with the earlier case, Secretary, Board of Revenue, Madras v. Mylapore Hindu Permanent Fund Ltd. By the time of the Tribunal's order an appeal was pending in the Supreme Court against the decision of the Madras High Court in Kumbakonam Mutual Benefit Fund Ltd. v. Commissioner of Income-tax. Their Lordships of the Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... return of what one has contributed to a common fund, and if profits are distributed to shareholders, the principle of mutuality is not satisfied. The principle of this decision applies with equal force to the facts and circumstances of this case, where, as observed by the Income-tax Officer, the members who contributed to the profits and the participants in the distribution of profits are not i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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