Assessee Wins: Life Membership Club Fee Not Taxable Income – Madras HC

Chennai Corporate Club (P) Ltd Vs ACIT (Madras High Court)

In a significant ruling for private clubs, the Madras High Court has declared that non-refundable life membership fees received by such entities constitute a capital receipt and are therefore not subject to income tax. The decision, delivered across five appeals pertaining to assessment years 2001-2002 to 2005-2006, favored Chennai Corporate Club (P) Ltd., overturning previous rulings by the Assessing Officer, Commissioner of Income Tax (Appeals), and the Income Tax Appellate Tribunal.

The core issue before the court

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