TMI Blog1983 (12) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... 2-1973 as a company limited by guarantee. The object of the club is to promote sports activities and to function as a social club. It also carries on business as proprietors of the club, viz., in regard to amusement, catering, etc. It follows calendar year as its previous year. The income and expenditure account of the club showed an excess of expenditure over income at Rs. 2,99,973. The said acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f of deficit against income from bank interest excluded miscellaneous receipts from the total income as determined by the ITO. 3. Not being satisfied with the decision of the Commissioner (Appeals) the assessee is in appeal before us contending that the total income from all activities should have been determined first and as there was an overall deficit in the income and expenditure account not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ignored and it could not be set off against any other income as the said deficit was not in the nature of loss as is ordinarily understood. The exclusion of loss, therefore, was on the principle of mutuality as aforesaid and, therefore, it could not be said to be income resulting in loss in which case the set off as claimed by the assessee was not permissible. 4. We have considered the rival sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of commercial loss but a deficit arising in course of carrying on mutual activity. Therefore, the loss as claimed by the assessee cannot be allowed against income from bank interest. The income from bank interest is not covered by the mutuality principle and is taxable as income derived by the assessee-club. It is true that the expression 'income' includes loss but in order to allow the claim of l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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