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2012 (6) TMI 514 - AT - Income TaxKeyman Insurance Policy - taxability of difference between the premium paid by employer and surrender value paid by employee to employer at time of assignment of same to employee - Held that:- Hight court in case of CIT Vs Rajan Nanda(2011 (12) TMI 392 (HC)), held that it was only the surrender value of the policy at the time of assignment or the sum received by an individual at the time of retirement, which is taxable. Insofar as assignment is concerned, at that time surrender value was paid by the employee and therefore, nothing could be taxed. Therefore, the difference between premium paid and surrender value is not taxable in the hands of assignee - Decided in favor of assessee. It is noteworthy that Keyman insurance policies becomes ordinary insurance policies at the time of assignment, hence, amount received on maturity of keyman insurance policy is to be treated as exempt u/s 10(10D).
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