TaxTMI 
TaxTMI 
TaxTMI 
2005 (1) TMI 607
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....Representative ('DR' in short) were heard. 3. The assessee has taken as many as six grounds of appeal. At the time of hearing, the learned AR did not press any ground except ground No. 2. All the grounds not pressed by the learned AR, except ground No. 2, are, therefore, dismissed as not pressed. Ground No. 2 which has been pressed by the assessee reads as under : "2.1 The learned CIT(A), erred in facts and in law in holding that the betterment charges (transfer charges) received by your appellant are in the nature of income and are not capital receipt not chargeable to tax. "2.2 The learned CIT(A) erred in facts and in law by concluding that the principles of mutualy were not applicable to the betterment charges (transfer charges) recei....
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....g their premises/shares transferred in favour of the transferees in terms of Bye-law No. D.3.5 of the Bye-laws of the Society. His thrust of the argument was that the transfer fee was charged by the assessee as per its bye-laws and not in excess of the limits laid down by law and hence the decision of the Special Bench of the Tribunal in Walkeshwar Triveni Co-op. Hsg. Society Ltd. v. ITO [2004] 267 ITR 86 (Mum.) (AT) would not apply. He also laid considerable emphasis on the fact that the assessee-society is a premises co-operative society and not a residential co-operative society and hence the limits of transfer fee laid down by the Government of Maharashtra in respect of residential flats would not apply. 7. The learned Departmental Rep....
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....paid for effectuating the transfer came from the transferees a part of which was passed on by the member-transferor to the assessee-society to facilitate transfer of his flat/share in the society in favour of the transferee. Thus, the amount paid to the assessee-society for having the transferor effected was, in substance, contributed and paid by the transferees which the transferred members simply passed on to the assessee-society ostensibly as their own contribution. The amounts, whether called the 'transfer fee' or 'contribution to the common amenity fund' or by any other name, were ultimately realized from the transferees without paying which the transferees would not have been admitted as members. In all the material respects, the impu....
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....of transferring the flat/ tenement should be fixed in the general meeting of the society subject to the ceiling laid down in the said Notification. In other words, the societies are authorized to charge premium at the time of transferring the flat but the premium so charged should, in no case, exceed Rs. 25,000 in the areas falling under the Municipal Corporation and the Authority. The aforesaid notification is dated 9th August, 2001 whereas we are concerned with the assessment year 1993-94 in the appeal before us. Perusal of the said Notification shows that there was a similar Notification issued by the Co-operation Commissioner and Registrar, Co-operative Societies Maharashtra State, Pune, bearing No. Housing/Tenement Transfer/Fee/89, dat....
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.... object for main such charges to effect the transfer. This amounts to mal-practice. Such unlawful or illegal means should not be encouraged. 86. Bacon said, "laws are like cobwebs; where the small flies are caught, and the great breakthrough". To maintain the Majesty of law, it is imperative that innocent should not suffer and recalcitrant should not go scot free. If a Co-operative Housing Society indulged in mal-practices and adopted unlawful or illegal means to achieve the objective, it should face the consequences. But if there is no evidence apropos any malpractice, it woun't be fair to view the Society with suspicion. If the premium is charged within the limits prescribed under law, no profit motive can be attributed to the Society. I....
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....he Government of Maharashtra makes it amply clear that the Notification is applicable to the flats as well as tenements. There is nothing in the said Notifications to indicate that they are applicable only to the societies having residential units alone. The assessee wants that we should construe the term 'housing' to mean only residential housing and not commercial housing. 'House' undoubtedly includes residential apartments but its meaning is not restricted to them alone. The term 'house' or 'housing' is a term of wide import and includes all permanent structures whether used for residential purposes or commercial purposes. In Tata Engineering & Locomotive Co. Ltd. v. Gram Panchayat, Pimpri Waghere AIR 1976 SC 2463, 2467, it has been held....