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IN THE INCOME TAX APPELLATE TRIBUNAL

MUMBAI BENCH “H(SMC)”, MUMBAI

BEFORE SHRI OM PRAKASH KANT, ACCOUNTANT MEMBER AND

SHRI ANIKESH BANERJEE, JUDICIAL MEMBER

ITA No.307/Mum/2026 (Assessment year: 2018-19)

ITA No.308/Mum/2026 (Assessment year: 2020-21)

Vashi Infotech Park Primises vs ITO, Ward 28(3)(1), Mumbai

Co OP Society Ltd. 3^rd Floor, Vashi Income Tax Office-

Plot No.16, Sector 30A, Behind 400703

Raghuleela Mall Vashi Navi

Mumbai-400703

PAN:AABAV0843J

APPELLANT RESPONDENT

Assessee by : Shri R.K. Jadeja

Revenue by : Shri Pravin Salunkhe (Sr. DR)

Date of hearing : 22/04/2026

Date of pronouncement : 28/04/2026

O R D E R

Per: Anikesh Banerjee (JM):

The instant appeal pertains to the assessee filed against the order of the

NFAC, Delhi [for brevity the “Ld. CIT(A)”], order passed under section 250 of the

Income Tax Act 1961 (for brevity ‘the Act’) for Assessment Year 2018-19 and

2020-21, date of both orders 19.11.2025. The impugned orders emanated from

the order of the National e-Assessment Centre, Delhi (for brevity the ‘Ld. AO’)

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ITA No.307 & 308/Mum/2026

Vashi infotech Park Premises Co Op Society ltd.

order passed under section 143(3) r.w.s. 144B of the Act date of order 05.03.2021

and 07.09.2022 for A.Y. 2018-19 and A.Y. 2020-21 respectively.

2. Both the appeals pertain to the same assessee and arising out from the

common fact. For convenience both the appeals have taken together and heard

together and disposed of by a common order. ITA 308/Mum/2026, AY 2020-21 is

taken as lead case and the decision rendered therein should be applicable mutatis

mutandis to the other appeals.

3. The brief facts of the case is that the assessee is a cooperative Housing

Society and filed its return by declaring income nil. After the due deduction u/sec.

80P amount to Rs.44,70,687/-. Subsequently the case was selected for scrutiny

through CASS under complete category. After due verification the Ld. CIT(A) has

rejected the claim of deduction under Chapter VI-A, u/sec. 80P of the Act and

added back with the total income. The aggrieved assessee filed an appeal before

the Ld. CIT(A). The Ld. CIT(A) uphold the impugned assessment order. Being

aggrieved assessee filed an appeal before us.

4. The Ld. AR contended that it is a well-settled proposition of law that any

surplus arising from mutual dealings between a society and its members is not

taxable, by virtue of the doctrine of mutuality. Although such surplus, including

members’ subscriptions, may partake the character of income or profits, the same

is not exigible to tax owing to the mutual nature of the transactions. Even interest

charged by the society on outstanding dues of its members constitutes a

contribution from members and satisfies the test of mutuality, since the

contributors and the participators are identical. The essence of the principle of

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Vashi infotech Park Premises Co Op Society ltd.

mutuality lies in the complete identity between the contributors to the common

fund and the participants in the surplus, who are also its beneficiaries. In simple

terms, a person cannot make a profit out of himself; therefore, any amount

received from oneself cannot be regarded as income liable to tax. Consequently,

income falling within the ambit of the doctrine of mutuality is not chargeable to

tax. In the present case, the surplus has arisen solely out of mutual dealings

between the society and its members. The doctrine of mutuality squarely applies,

as all contributors to the common fund are entitled to participate in the surplus,

and all participators are contributors thereto. There exists a complete identity

between contributors and participators, thereby attracting the principle of

mutuality. Accordingly, the surplus of Rs.44,70,687/- cannot be treated as taxable

income in the hands of the society. Respectful reliance is also placed on the

judgments of the Hon’ble Supreme Court in ITO v. Venkatesh Premises Co-

operative Society Ltd. reported in [2018] 91 taxmann.com 137 (SC) Non-

occupancy charges rec