Doctrine of mutuality bars tax on club supplies to members, even after the 46th Constitutional Amendment.

An incorporated members' club supplying food and drinks to its own members was held not to make a taxable sale under the U.P. Trade Tax Act, 1948 because the doctrine of mutuality prevents a transfer between distinct persons. The statutory definition of sale in Section 2(h) was read in light of the continuing authority of Young Men's Indian Association and Calcutta Club Limited, both of which confirm that mutuality applies to incorporated and unincorporated members' clubs after the 46th Constitutional Amendment. Article 366(29-A)(f) was held not to apply to members' clubs, so the assessment based on treating the supply as a sale could not stand.

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Issues: Whether supply of food and drinks by an incorporated members' club to its members is liable to tax as a sale under the U.P. Trade Tax Act, 1948 after the 46th Constitutional Amendment.

Analysis: The statutory definition of sale under Section 2(h) of the U.P. Trade Tax Act, 1948 was considered in the light of the doctrine of mutuality. The controlling legal position remained that a club supplying food and drinks to its own members does not effect a sale because the element of transfer from one distinct person to another is absent. The Constitution Bench decision in Young Men's Indian Association continued to govern the field, and the later ruling in Calcutta Club Limited reaffirmed that the doctrine of mutuality applies even to incorporated and unincorporated members' clubs after the 46th Amendment. It was also held that Article 366(29-A)(f) does not apply to members' clubs.

Conclusion: The supply of food and drinks by the revisionist club to its members was not taxable as sale under the Act of 1948, and the assessment based on that premise could not stand.

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