“Entrance fees” received by a club from “new members” is a “Capital receipt”:

Assessee is running the business of gymkhana and club. AO made an addition in respect of “Entrance fees” received from “new members”. Hon’ble ITAT observed that such entrance fees was charged by the assessee as one-time fee and was non-refundable in nature. It was held that such entrance fee is a capital receipt and was rightly deleted by CIT(A). Hon’ble ITAT had followed the ratio laid down in the case of ACIT vs. Karnavati Club Ltd. (ITA No.2963/Ahd/2009 and CO 269/Ahd/2009).

[DCIT vs. Gala Gymkhana Pvt. Ltd.” – ITA No.960/Ahd/2010]