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2016 (12) TMI 1741 - AT - Income TaxAssessment of income - Assessee carrying on two independent activities, - one of insurance business which was reflected in Policyholders’ Account by the assessee and the other, being an independent activity depicted in Shareholders’ Account, as per the detailed findings given in the assessment order - Held that:- Assessee has time and again brought to the notice of the AO that assessee is engaged only in the business of life insurance. It has been brought to the notice of the AO that no other business has been carried out. The investments were made in line with the requirement of applicable regulations. It is further noted that nothing has been brought out by the AO in the assessment order to show if any other business has been done by the assessee. Shareholders’ Account and Policyholders’ Account have been separately maintained for the purpose of meeting the requirement of law as mentioned above also. There was no justification to artificially disintegrate the business by separately assessing the amount transferred from one account to the other by the assessee for the purpose of maintenance of accounts as per requirement of law. As relying on Tribunal order wherein it has been held that assessee was engaged in only one business, i.e. business of life insurance - recomputation of income made by the AO was rightly rejected by the Ld. CIT(A). As a result, Grounds 1(i) & 1(ii) raised by the Revenue are hereby dismissed. Disallowance of stamp duty charges - treating expenses as capital expenditure as against revenue expenditure claimed by the assessee - Held that:- This issue stands decided by the AO in favour of the assessee on the basis of legal principle by relying upon the orders of the Tribunal in the case of HDFC Standard Life Insurance Co Ltd [2013 (10) TMI 1072 - ITAT MUMBAI]. In this year also, there would be no point in sending the issue back for futile exercise as the decision has already been taken, which can be applied here also. We have considered the request of the Ld. Counsel. No objection or any contrary argument was made by the Ld. CIT-DR in this regard. - Decided against revenue Addition on account of Negative Reserve - Held that:- AO has himself took a decision that the Negative Reserves cannot be added back while computing the income of life insurance assessee company u/s 44 read with rules 1 & 2 of First Schedule of the Income-tax Act, 1961. Under these circumstances, we find that no dispute is left on this issue. Therefore, we find that addition has been rightly deleted by the Ld. CIT(A) on the basis of his well reasoned findings. - decided against revenue Grant of benefit of exemption u/s 10(32) on dividend income received - Held that:- We have gone through the order passed by Ld. CIT(A) also and find that the benefit of exemption was granted by the Ld. CIT(A) relying upon the judgement in the case of Life Insurance Corporation of India vs CIT (1977 (11) TMI 25 - BOMBAY HIGH COURT) as well as ICICI Prudential Insurance Co Ltd vs ACIT (2012 (11) TMI 13 - ITAT MUMBAI). AO in Order Giving Effect has also granted relief to the assessee by relying upon these judgements. Under these circumstances, we do not find it necessary to interfere in the finding of Ld. CIT(A) and, therefore, the order of the Ld.CIT(A) is upheld. These Grounds raised by the Revenue are dismissed. Addition u/s 14A on the basis of Rule 8D - Held that:- In view of the special provisions applicable to the insurance companies, we are of the opinion that the provisions of section 14A r.w.r. 8D were held not applicable to the insurance companies i.e., lCICI Prudential Insurance, HDFC Standard Life Insurance Company. Therefore, the SSI Life Insurance Company Limited (assessee in the present case should not be any exception. Exemption u/s 10(23AAB) in regard to income of pension fund to be allowed as relying on ICICI Prudential Insurance Co Ltd vs ACIT (2012 (11) TMI 13 - ITAT MUMBAI).
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