Timeshare membership fee is taxable only over the term of contract

ACIT Vs. Mahindra Holidays & Resorts (ITAT Chennai Special Bench)

The assessee, a time-share company having resorts at tourist places granted membership for a period of 33/25 years on payment of certain amount. During the currency of the membership, the member had the right to holiday for one week in a year at the place of his choice from amongst the resorts of the assessee. The membership fee was received either in lump sum or in instalments to the prospective member.

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