Lawstreet Journal

SC Reverses Verdict Of Karnataka HC, Holds Bangalore Club Not Liable To Pay Wealth Tax [READ JUDGMENT]

Lawstreet Journal 10 Sep 2020 8:26pm

Image courtesy: Lawstreet Journal Judiciary SC Reverses Verdict Of Karnataka HC, Holds Bangalore Club Not Liable To Pay Wealth Tax [READ JUDGMENT]

The Supreme Court has held that “Bangalore Club” being one of the oldest clubs of Bangalore is not responsible to pay Wealth-tax under the Wealth Tax Act, 1957. The Bench comprised of three judges namely- Justice RF Nariman, Justice Indira Banerjee, and Justice Navin Sinha set aside the judgment of Karnataka High Court which had held otherwise and levied wealth tax on the club. 

The Bench stated in its order that “the Bangalore club is an association of persons and not the creation, by a person who is otherwise assessable of one among a large number of associations of persons without defining the shares of members so as to escape tax liability. As per the abovementioned reasons it is clear that Section 21AA of the Wealth Tax Act doesn’t get attracted in the present case.”

The case was heard before the Income Tax Appellate Tribunal which set aside the order of revenue authority mentioning the same as the Apex Court that section 21AA of the Wealth Tax doesn’t apply on the Bangalore Club. But the order was reversed by the Karnataka High Court which counted the Bangalore Club within the frame of Section 21AA of the Act. 

The Court considered the appeal of the Club and Justice RF Nariman has noted some history of the Club as follows:

In the year of 1868, a group of British officers banded together to start a Bangalore Club. Then in the year 1899, one Lt. WLS Churchill was put up on the defaulters' list of the club… Continue Reading...

Tagged: Karnataka high court   Supreme Court of India  
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