M/S. Bangalore Club vs Commissioner Of Income Tax & Anr

The Supreme Court addressed the applicability of the doctrine of mutuality in the context of income tax exemptions under the Income Tax Act, 1961. The Court held that interest earned by an unincorporated association from fixed deposits with its corporate members does not qualify for exemption as it constitutes taxable income, affirming the High Court's ruling that the relationship between the club and the banks is that of a banker and customer, thus rejecting the claim of mutuality. The Court's decision effectively upheld the assessment officer's original order, reversing the Tribunal's findings in favor of the assessee.