Case Law Details
RELEVANT PARAGRAPH
7. We have the rival submissions and perused the records. During the year under consideration the assessee society had claimed as exempt a sum or Rs. 10.00 Lakhs received on account of damages for wrongful proceedings against the society taken up before the Deputy Registrar of Co-operative Housing Society. Mr. Manojkumar Goswami & Mrs. Shashi Goswami were allottees of plot Nos. 47 & 48 in the society.
The two lesses along with M/s. Oberoi Construction Ltd. tried to amalgamate the flat and redevelop the same. However, the same being outside the Rules of the society, the objections were filed before the Deputy Registrar of Co-operative Housing Society which in-turn decided the matter in favour of the assessee society. The complaint filed by Mr. Manojkumar Goswami was withdrawn and in-turn the assessee society also withdrew its proposed action to cancel the lease deed executed in favour of Mr. & Mrs. Goswami subject to payment of damages. The damages were fixed at Rs. 31-8-2001. The said damages were stated to be paid on behalf of Mr. & Mrs. Goswami who in-turn were Members of the assessee society and hence the principle of mutuality being applicable, the said receipts were claimed as exempt. Admittedly the payment has been made by M/s. Oberoi Construction Ltd., who was a party to the complaint filed before the Deputy Registrar of Co-operative Housing Society. Undoubtedly, Mr. and Mrs. Goswami are the members of the society, however the payment is made by M/s Oberoi Construction Ltd. into the fact that the said payment has been made by him on behalf of Mr. & Mrs. Goswami despite the point raised by the Assessing Officer and the Commissioner (Appeals). The assessee has only referred to a letter filed by Mr. Goswami before the Assessing Officer concerned of the assessee society wherein he claims that the payment has been made on his behalf, which is a self serving evidence.
8. The Special Bench of Mumbai Tribunal in Walkeshwar Triveni Co-operative Housing Society Ltd. v. ITO (88 ITD 159) (SB)(Mum.) had held as under:
“No one can make a profit out of himself. In short this is the principle of mutuality. The cardinal requirement for mutuality is that a contributor to the common fund must be entitled to participate in the surplus and that all the participators in the surplus must be contributors to the common fund. For this doctrine to apply, it is since qua non that there should be complete identity between the contributors and participators. This means identity as a class, so that at any given moment of time the persons who are contributing are identical with the persons entitled to participate. “
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