TaxTMI 
TaxTMI 
2015 (11) TMI 1512
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.... and are being disposed of by this consolidated order for the sake of convenience. 2. First, we take up the Revenue's appeal in ITA No.2337/Ahd/2011 for AY 2008-09. The only effective ground raised by the Revenue reads as under:- 1. The Ld.CIT(A) has erred in law and on facts in deleting the addition of Rs. 1,75,15,680/- on account of membership fee income without appreciating fact that the so called security deposit was inextricably linked to grant of membership. 2. On the facts and in the circumstances of the case, the ld.CIT(A) ought to have upheld the order of the Assessing Officer. 3. It is, therefore, prayed that the order of the Ld.CIT(A) may be set aside and that of the Assessing Officer may be restored....
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....ent of Hon'ble Patna High Court rendered in the case of CIT vs. United Club Equivalent citations: (1986) 161 IR 853(Patna). In support of the contention that the security deposits were required to be taxed. 4.1. On the contrary, ld.Sr.counsel for the assessee submitted that the approach of the ld.CIT(A) is not justified. He placed reliance on the judgement of Hon'ble Supreme Court rendered in the case of Siddheshwar Sahakari Sakhar Karkhana Ltd. vs. CIT reported at [2004] 270 ITR 1 = 139 Taxman 434 (SC). He submitted that the deposits would not partake the character of income as the same requires to be refunded. He narrated certain instances where the security deposits were refunded. He submitted that the judgement which is relied upon b....
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....onal High Court in the case of Unique Mercantile Services Pvt.Ltd. in Tax Appeal Nos.1471 to 1478 of 2005, wherein the Hon'ble High Court has confirmed the view of the Tribunal holding that the assessee would entitle for spreading over the non-refundable fee on accrual basis, undisputedly the one time security deposit is refundable. The Hon'ble Supreme Court in the case of Siddheshwar Sahakari Sakhar Karkhana Ltd. (supra) has held that these deposits are akin to transaction of loan. They are clearly liable to be excluded from taxable income. Therefore, respectfully following the judgement of the Hon'ble Apex Court in the case of Siddheshwar Sahakari Sakhar Karkhana Ltd., we are of the considered view that the security deposits as received b....
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....ountancy and provisions of law that ought to be quashed. 3. The ld.CIT(A) erred in law and on facts in dismissing the alternate plea of the appellant as infructuous though agreeing with the contention raised that if security deposits were treated as income than estimated cost of development/maintenance expenditure be allowed as revenue expenditure against such income. Ld.CIT(A) also accepted the contention that all fees charged from the members for utilization of the facilities of the club for the entire tenure be allowed as exempt. 4. The ld.CIT(A) erred in law and on facts in confirming disallowance of Rs. 2,60,570/- made by AO applying provisions of section 14A of the Act. Both the lower authorities have failed to consi....
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....would partake the income of the assesseeclub. We are of the considered view that every receipt cannot be termed as income unless it is satisfies the requirement of law. In the present case, the assessee-club had received refundable non-interest bearing security deposit would remain liability for the assessee-club. Member by giving security deposit entitles himself for the concessional rate services provided by the assessee-club. Therefore, looking to the totality of the facts of the case and in view of the judgement of the Hon'ble Supreme Court in the case of Siddheshwar Sahakari Sakhar Karkhana Ltd. reported at 270 ITR 1 (SC) and also the judgement of Hon'ble Jurisdictional High Court in the case of Unique Mercantile Services Pvt.Ltd. in T....