COMMISSIONER OF INCOME TAX Vs. BANKIPUR CLUB LIMITED

JUDGEMENT

(1.) ALL these tax cases arise out of references made by the Income-tax Appellate Tribunal under Section 256(1) of the Income-tax Act, 1961 (hereinafter to be referred to as " the Act ").

(2.) SINCE the basic question of law in all these reference applications is common, these have been heard together and are being disposed of by this common judgment.

(3.) THE club has a bar where drinks are supplied to the members and their guests. THE club also serves refreshments and meals to its members. It has also a set of rooms which are let out to its members. It has got a hall which is let out with furniture to the Rotary Club, Lions Club, etc., on payment. Apart from permanent members, the club, under its articles of association, has also temporary members, lady members, honorary members and patrons. THE guests of the members cannot eat or drink of their own accord meaning thereby that nothing can be sold to them even if they pay. Members can only order for services to be rendered to their guests for which the members alone pay or sign the bills. THE set of rooms are also let out only to the members and if guests stay, the rooms are booked in the names of the members alone who alone have to pay the charges. In these tax cases, the dispute resales only with regard to certain payments which have been made by the members.