COMMISSIONER OF INCOME-TAX, BIER vs M/S. BANKIPUR CLUB LTD.

The Supreme Court addressed the taxation status of Members' Clubs, registered under Section 25 of the Companies Act, 1956, which claimed exemption from income tax on surplus receipts. The Court held that the surplus receipts of these clubs, derived from providing services to members, do not constitute taxable income under the Income-tax Act. The judgment clarified that such clubs, being mutual undertakings, do not engage in trade or business for profit, thus affirming their non-taxable status.