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21. Shri Patil heavily relied on the decision of the Hon'ble Calcutta High Court rendered in the case of CIT v. Apsara Co-operative Housing Society Ltd. (1993) 204 ITR 662 (Cal). In this case the issue was in regard to the taxability of transfer fee realised by the society for transfer of flats. It was noted that the persons have to first become members of the society before they can be entitled to get flats transferred in their names or become liable to pay transfer fees. Court found that the transfer fee so realised is for the benefit of the members of the society. As such, it was held to be a mutual concern and the transfer-fee was not liable to tax.

It was stated by Shri Korde that the members may come, they may go, but they take the position of the member at a particular point of time. The case of a housing society cannot be equated with a club.

40. Adverting our attention to the transfer from and the receipt issued by the society with reference to the resolution passed, it stated that first approval of transfer payment follows that payment is made after the member has gone out. The transferor assigned all rights to the transferee in essence. The transferor cannot be construed to be a member. There was no identity between the contributor and the participator as the payment is made not as a member but as a transferor subsequent upon the surrender of his rights. In essence it cannot be said to be a voluntary payment. It is a conditional payment. It does not satisfy the test of mutuality. The procedure of transfer was explained with reference to Clause 24 of the bye-laws.

56. Shri Dave discussed the procedure for transfer of flat. Various clauses of the bye-laws were read out to explain the procedure. Shri Dave stated that ownership cannot remain in vacuum. The flat was owned by someone at a particular point of time. It cannot be said that when transfer was in the offing the ownership vested in the transferee. Two persons simultaneously cannot hold same share. As such the principle of mutuality cannot be invoked. He also made distinction between legal possession and possession by consent. He discussed the right of equitable owner. Our attention was invited on the various steps and procedural formalities which are necessary for effecting the transfer. It was contended that it hits the basic root of mutuality. Therefore, it is to be taxed.

78. In the case of Adarsh Co-operative Housing Society Ltd (supra), it was held that the income of a mutual concern is not exigible to tax. The co-operative housing society was found to be a mutual concern. The income was exempted on the principle that no one can make a profit by transacting with oneself. In this case the Revenue authorities found that the amounts contributed by the outgoing members were utilised by the society for extending common amenities to the members. The corpus fund of the assessee was not divisible. The Hon'ble High Court has held that, the right of members to deal with the surplus was not destroyed but only restricted to the extent that instead of dividing the corpus pro rata, it has confined to utilization of the surplus for the objectives as per their own decision. This did not detract from the concept of return of surplus to members which they had "contributed. On this factual backdrop the assessee was treated as a mutual concern. As such, its income was not liable to tax. Similar view was taken in the case of Apsara Co-operative Housing Society Ltd. (supra). The element of mutuality was found in respect of the transfer fee. As such, it was held that the receipt was not subject to tax. We have noted the difference in the provision of MCS Act and Gujarat CS Act in this regard.