TMI Blog2014 (10) TMI 968X X X X Extracts X X X X X X X X Extracts X X X X ..... omitted by the Finance Act 1988, w.e.f. 1.4.1989. The only effect of section 44 is that the operation of provisions referred to therein are excluded in the case of an assessee who carries on insurance business and in whose case the provisions of Rule-2 of the First Schedule are attracted. Section 44 is a special provision enshrined in the Act for ascertaining the profit and gains of an assessee carrying on the business of insurance. Thus it can be said that special provision overrides the general provision. In view of this legal position the amount of profit, as disclosed by the P&L Account are to be drawn as per the insurance Act. The Hon'ble Apex Court in Britannia industries Ltd.(2005 (10) TMI 30 - SUPREME Court) reiterated the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . On the other hand, Shri Farrokh V. Irani, ld. Counsel for the assessee, supported the conclusion drawn in the impugned order by further submitting that the issue in hand is covered by the decision from Hon'ble Jurisdictional High Court in the case of General Insurance Corpn. of India vs. DCIT (2012) 342 ITR 27 (Bom.). 3. We have considered the rival submissions and perused the material available on record. The facts in brief are that the assessee is in the business of general insurance, filed its return declaring loss of ₹ 407,27,37,834/- on 29/11/2006. The ld. AO determined the income at ₹ 800,62,59,120/- while completing the assessment u/s. 143(3) of the income tax Act, 1961 (hereinafter the Act) on 31.12.2007. Subseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wider power of the AO w.e.f. 1/5/1989 after considering circulars and held that re-assessment proceedings are not valid merely on the basis of change of opinion. Part A of the first Schedule containing Rules 1 to 4 deals with profit of Life Insurance business while part-B consisting of Rule-5 deals with computation of profits and gains of other insurance business. Rule-5 provides as follows:- 5. The profits and gains of any business of insurance other than life insurance shall be taken to be the balance of the profits disclosed by the annual accounts, copies of which are required under the Insurance Act, 1938 (4 of 1938), to be furnished to the controller of Insurance, subject to the following adjustments:- a) Subject to the other p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... certaining the profit and gains of an assessee carrying on the business of insurance. Thus it can be said that special provision overrides the general provision. In view of this legal position the amount of profit, as disclosed by the P L Account are to be drawn as per the insurance Act. Our view further finds support from the decision from Hon'ble Jurisdictional High Court in the case of General Insurance Corpn. of India vs. DCIT (2012) 342 ITR 27 (Bom.). The Hon'ble Apex Court in GIC vs. CIT (240 ITR 139) observed as under :- The figures in the accounts of the assessee drawn up in accordance with the provisions of the First Schedule to the Income Tax Act and satisfying the requirements of the Insurance Act are binding on the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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