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Tax Events

Conference Call on ‘Doctrine of Mutuality – Upheld!’

11 October 2019


Date : 17th Oct 2019
Timing : 4:00 PM – 5:00 PM

Every once in a rare while, field of law throws up an issue around which reams and reams worth pages of literature - judicial pronouncements as also commentary of learned authors - is available, but a decision that will fit your case perfectly eludes you’. – Hon’ble Justice Mr. Akil Khureshi.
 
The intention of this conference call is to take every listener through one such interesting judgement in the case of Calcutta Club Ltd., wherein a three-judge bench of the Supreme Court was met with the opportunity to consider the ‘Doctrine of Mutuality’.
 
The common law principle of mutuality is premised on the idea that no man can profit from oneself. The principle is applied to those class of persons who carry out an activity and are also the ones who are entitled to take benefits from the activity carried on. This doctrine gained special significance in the eyes of the law when considered in the context of supplies made by the club to its members.

Thus, when the club provides food/drinks to its member in a restaurant, is there a supply of goods or services by the club to its members or is it nothing but a service/sale to oneself? It was this very question which was considered by the three-judge bench in the judgement of Calcutta Club Ltd., specifically in light of the fiction created by Article 366(29A) of the Constitution of India. 

The Court held that no sales tax or service tax is leviable with respect to supplies made by incorporated clubs to its members. The judgement, without a doubt, is a milestone achieved in the long-drawn litigation surrounding the doctrine of mutuality.
 
Under this backdrop, Lakshmikumaran & Sridharan is organizing a conference call, where Mr. Raghavan Ramabadran, Partner, L&S will analyze and discuss the nuances of the judgement in detail with an intention to assist trade and industry in understanding the significance of the case.