TMI Blog2018 (10) TMI 1096X X X X Extracts X X X X X X X X Extracts X X X X ..... n 2(9)(c) of Insurance Act, 1938. The entire re-insurance arrangement of the assessee- company is in violation and contrary to the provisions of Section 2(9) of Insurance Act, 1938. Therefore, the entire re-insurance premium has to be disallowed under Section 37 of the Act. In this case, the Assessing Officer disallowed the reinsurance premium for non-deduction of tax. Section 2C read with Section 2(9)(c) of Insurance Act, 1938 prohibits any person from doing insurance or re-insurance business in India otherwise permitted under Insurance Act, 1938. Therefore, there is a clear prohibition for payment of re-insurance premium to the non-resident re-insurance companies. Hence, the disallowance has to be made under Explanation 1 to Section 37 of the Act also. Tribunal is of the considered opinion that the Assessing Officer has rightly disallowed the reinsurance premium under Section 40(a)(i) of the Act. Therefore, the CIT(Appeals) is not justified in restricting the claim of the assessee to 15% without any reason. - Decided in favour of revenue. Disallowance of provision created towards claim incurred but not reported and claim incurred but not enough reported - Held that:- Thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irmity in the order of the CIT(Appeals). Accordingly, the same is confirmed. TDS U/S 194D - assessee has paid commissions while accepting re-insurance premium from various other insurance companies in India without deduction of tds - Held that:- The responsibility of paying commission is not on the assessee. The commission was deducted by the respective insurance companies who are paying re-insurance premium to the assessee at the time of making payment. Therefore, this Tribunal is of the considered opinion that the assessee cannot be found fault for non-deducting the tax. The situation may stand otherwise in case the assessee, after receiving entire re-insurance premium, makes payment of commission. In this case, the respective insurance companies themselves act as agents and deduct the commission by themselves. Hence, the CIT(Appeals) has rightly allowed the claim of the assessee. Provision towards Employees Short Term Benefits in the computation of book profit - Held that:- the provisions made for Employees Short Term Benefit cannot be allowed as deduction. Rule 5(a) of First Schedule to the Act clearly says that the expenditure or any provision which is not admissible und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g reliance on the order of this Tribunal dated 18.08.2005 confirmed the disallowance made by the Assessing Officer. Right from the assessment year 1989-90 to 2004-05, similar claim of the assessee was disallowed. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. Profit on sale / redemption of investment to be allowed by placing reliance on the order of his predecessor for assessment years 1996-97, 1997-98, 1998-99, 2001-02 and 2002-03, decided the issue in favour of the assessee. Contribution to Pension Fund - Held that:- This Tribunal is of the considered opinion that Superannuation Fund is nothing but a fund created by the respective employer to compensate the employees who are retiring from service on superannuation. Therefore, the nomenclature of fund is immaterial. The benefit given to an employee by the employer on superannuation has to be construed as Superannuation Fund. Therefore, this Tribunal is unable to uphold the contention of the assessee that the Pension Fund is different from Superannuation Fund. Hence, this Tribunal do not find any reason to interfere with the order of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne the delay and admit the appeal. 3. The first common issue arises for consideration in both the assessee and Revenue s appeals is disallowance of re-insurance premium paid by the assessee to the non-resident re-insurance companies. 4. Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee, submitted that there are five categories of re-insurance premiums paid by the assessee to the non-resident. (1) Directly to non-resident re-insurance companies who are residents of countries with whom India has Double Taxation Avoidance Agreement. (2) Directly to non-resident re-insurance companies through non-resident brokers who are residents of countries with whom India has Double Taxation Avoidance Agreement. (3) Directly to non-resident re-insurance companies through resident brokers where there is Double Taxation Avoidance Agreement between India and the residence of re-insurance companies. (4) Directly to non-resident re-insurance companies where there is no Double Taxation Avoidance Agreement. (5) Directly to non-resident companies through brokers where there is no Double Taxation Avoidance Agreement. According to the Ld. Sr. counsel, the assessee is eng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Insurance Corporation of India as specified by the Insurance Regulatory And Development Authority of India. The Ld. Sr. counsel further submitted that in fact, the assessee complied with the mandatory requirement of reinsurance as specified by Insurance Regulatory And Development Authority of India and there is no dispute about this. In other words, there is no dispute with regard to statutory ceding or obligatory ceding of reinsurance as required under Section 101A(1) of the Insurance Act, 1938. 6. Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee, further submitted that Section 101A(7) of the Insurance Act, 1938 further clarifies that the assessee over and above the percentage of re-insurance sum fixed by the Insurance Regulatory And Development Authority of India may also at its option, reinsure the risk with any Indian re-insurer or other re-insurer the entire sum assured on the policy or portion thereof in excess of percentage specified by Insurance Regulatory And Development Authority of India. Therefore, according to the Ld. Sr. counsel, in order to reinsure the risk over and above specified by the Insurance Regulatory And Development Authority of India, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er directly or through independent brokers situated either in India or outside India. The brokers who operate in India need to get registered themselves with the Insurance Regulatory And Development Authority of India. According to the Ld. Sr. counsel, the brokers represented multiple insurance companies and reinsurance companies. Therefore, they are independent agents / brokers and they are not attached to any particular insurance company or re-insurance company. According to the Ld. Sr. counsel, the independent brokers act only as a facilitator between the assessee-insurance company and non-resident re-insurance company. The brokers have no role in negotiating the re-insurance contract on behalf of either the Indian insurer or non-resident re-insurer. According to the Ld. Sr. counsel, the brokers function in their ordinary course of business representing no re-insurance or insurance companies. Non-resident brokers can also represent multiple non-resident re-insurance companies. The brokers are not dependent of any insurance companies, therefore, the brokers cannot be construed as dependent agent having a permanent establishment in India. According to the Ld. Sr. counsel, even ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unsel, normally, there was no negotiation in the terms and conditions. The reinsurance premium would be paid in proportionate to the risk taken over by the non-resident company. The Ld. Sr. counsel further clarified that if the non-resident re-insurance company takes over the risk of 10% of risk assumed by the assessee-company, the 10% of premium collected by the assessee-company would be paid to the non-resident re-insurance company. According to the Ld. Sr. counsel, the negotiation with non-resident re-insurance company would only be with respect to percentage of risk that would be taken over by them. The percentage of risk would normally offered by the assessee-company, and then there would be counter offers from the re-insurance company. According to the Ld. Sr. counsel, if there is a broker, he acts only as a communication channel in the transaction and the broker would not play any role for negotiation or finalization of percentage of the re-insurance. Once the percentage of re-insurance is accepted by the assessee and non-resident re14 insurance company, the proportionate share as per the agreed percentage would be paid to non-resident re-insurance company as per the terms a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of appointing independent surveyor by the re-insurer has happened sofar. 13. The Ld. Sr. counsel further submitted that the re-insurance is nothing but an insurance taken by the insurance companies to protect itself against the loss and to safeguard its interest. According to the Ld. Sr. counsel, the assessee being an insurer transfers their part of risk to another re-insurer or insurer in order to reduce its own liability in the event of any claim of damages. On a query from the Bench, the Ld. Sr. counsel submitted that normally the re-insurer accepts the claim made by the assessee-company wherever there was a loss to the property which is subject matter of insurance. However, to meet the extraordinary event, in case of disputes, according to the Ld. Sr. counsel, the treaty slip provides for appointing of arbitrator. The place of sitting of arbitrator is in India. The Ld. Sr. counsel further submitted that since the nonresident re-insurance company operates outside the country, the profit is not chargeable to tax in India. Referring to the order of the CIT(Appeals), the Ld. Sr. counsel submitted that the CIT(Appeals) placed reliance on the judgment of Bombay High Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2) of Section 101A of the Insurance Act, 1938. According to the Ld. Sr. Standing Counsel, the Indian re-insurer is defined in sub-section (8)(ii) of Section 101A. As per this definition, Indian re-insurer means an insurance company which has been granted registration certificate under sub-section (2a) of Section 3 by Insurance Regulatory And Development Authority of India to carry on exclusively the reinsurance business in India. As on date, the authority granted registration exclusively for carrying on re-insurance business only to the General Insurance Corporation of India. Therefore, according to the Ld. Sr. Standing Counsel, the General Insurance Corporation of India is the only Indian re-insurance company. Sub-section (7) of Section 101A of Insurance Act, 1938 also enables the assessee to have re-insurance with other insurer. Therefore, according to the Ld. Sr. Standing Counsel, the real question arises for consideration is who are the other insurers other than Indian re-insurer, namely, General Insurance Corporation of India? 16. Referring to Section 2(9) of the Insurance Act, 1938, the Ld. Sr. Standing Counsel for the Revenue submitted that the term insurer is defin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40(a)(i) of the Act. Even otherwise, the re-insurance premium was paid contrary to the statutory provision, namely, Section 2(9) of the Insurance Act, 1938, therefore, the CIT(Appeals) is not justified in restricting the disallowance to 15%. According to the Ld. Sr. Standing Counsel, the Revenue filed appeal against the order of the CIT(Appeals) where he restricted disallowance to 15%. According to the Ld. Sr. Standing Counsel, the entire re-insurance premium paid by the assessee-company has to be disallowed under Section 37 of the Act since it was paid in violation of Section 2(9) of the Insurance Act, 1938 as it stood at the relevant point of time. 18. By way of rejoinder, Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee, submitted that re-insurance programme of the assessee-company was made after extensive discussion with General Insurance Corporation of India, the lead-reinsurer. The Ld. Sr. counsel further submitted that Section 2(9) of the Insurance Act, 1938 is not at all applicable to the assessee. By virtue of the rule framed by the Insurance Regulatory And Development Authority of India, in exercise of its statutory power under Section 114A of the Ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so specify the proportions in which the said percentage shall be allocated among the Indian re-insurers. (3) Notwithstanding anything contained in sub-section (1), an insurer carrying on fire-insurance business in India may, in lieu of re-insuring the percentage specified under sub-section (2) of the sum assured on each policy in respect of such business, re-insure with Indian re-insurers such amount out of the first surplus in respect of that business as he thinks fit, so however that the aggregate amount of the premiums payable by him on such re-insurance in any year is not less than the said percentage of the premium income (without taking into account premiums on re-insurance ceded or accepted) in respect of such business during that year Explanation- For the purposes of this-section, the year 1961 shall be deemed to mean the period from the 1st April to the 31st December of that year. (4) A notification under subsection (2) may also specify the terms and conditions in respect of any business of re-insurance required to be transacted under this section and such terms and conditions shall be binding on Indian re-insurers and other insurers. (5) No notification under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the rules made thereunder, to carry out the purposes of the Insurance Act. The term re-insurance is also defined in Section 2(16B) of the Insurance Act, 1938 which reads as follows:- re-insurance means the insurance part of one insurer s risk by another insurer who accepts the risk for a mutually acceptable premium. 21. Therefore, the entire business of insurance / re-insurance is codified and regulated by Insurance Act, 1938. All the insurance companies which are carrying on insurance business in India have to necessarily comply with the provisions of Insurance Act, 1938 as amended and the rules made thereunder. For the purpose of regularizing the insurance business in a better manner, the Insurance Regulatory And Development Authority of India was established and the said authority was also empowered to frame regulations in consistent with the provisions of Insurance Act, 1938 and rules made thereunder. Therefore, it is obvious that Insurance Regulatory And Development Authority of India has to frame regulations in consistent with the provisions of Insurance Act and rules made thereunder. In other words, Insurance Regulatory And Development Authority of India cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incorporated under a law of any country outside India and includes Lloyd s established under the Lloyd s Act, 1871 (United Kingdom) or any of the Members;] 23. The term Indian insurance company is also defined in Section 2(7A) of Insurance Act, 1938, which reads as follows:- (7A) Indian insurance company means any insurer being a company- (a) which is formed and registered under the Companies Act, 1956 (1 of 1956); (b) in which the aggregate holdings of equity shares by a foreign company, either by itself or through its subsidiary companies or its nominees, do not exceed twenty-six per cent. paid-up equity capital of such Indian insurance company; (c) whose sole purpose is to carry on life insurance business or general insurance business or re-insurance business. Explanation.- For the purposes of this clause, the expression foreign company shall have the meaning assigned to it under clause (23A) of section 2 of the Income-tax Act, 1961 (43 of 1961);] Section 2(7A) was amended by Insurance Laws (Amendment) Act, 2015 with retrospective effect from 26.12.2014, which reads as follows:- (7A) Indian insurance company means any insurer, being a company whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nies including the assessee may engage itself in reinsurance business since they were granted certificate of registration. By keeping the above provisions in mind, if we examine the transaction of the assessee in paying re-insurance premium to non-resident company, it is obvious that the assessee has violated the provisions of Indian Insurance Act, 1938. Provisions of Section 101A makes it mandatory to every insurer to re-insure with Indian re-insurers such percentage of sum assured on each policy as may be specified by the authority, namely, Insurance Regulatory And Development Authority of India. An option was given to the insurer under sub-clause (7) of Section 101A of Insurance Act, 1938 that an insurer may re-insure over and above the percentage prescribed by Insurance Regulatory And Development Authority of India with other insurer. By taking advantage of this provisions of sub-caluse (7) of Section 101A, the assessee now claims before this Tribunal that there was no prohibition in Insurance Act, 1938 or rules made thereunder or any regulation framed by Insurance Regulatory And Development Authority of India from re-insuring over and above the percentage prescribed by Insu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h reads as follows:- 2C. (1) Save as hereinafter provided, no person shall, after the commencement of the Insurance (Amendment) Act, 1950 (47 of 1950), begin to carry on any class of insurance business in India and no insurer carrying on any class of insurance business in India shall after the expiry of one year from such commencement, continue to carry on any such business unless he is- (a) a public company, or (b) a society registered under the Co-operative Societies Act, 1912 (2 of 1912), or under any other law for the time being in force in any State relating to co-operative societies, or (c) a body corporate incorporated under the law of any country outside India not being of the nature of a private company: Provided that the Central Government may, by notification in the official Gazette, exempt from the operation of this section to such extent for such period and subject to such conditions as it may specify, any person or insurer for the purpose of carrying on the business of granting superannuation allowances and annuities of the nature specified in subclause (c) of clause (11) of Section 2 or for the purpose of carrying on any general insurance business: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of Section 2(9) of the Insurance Act, 1938 is applicable as it stood at relevant point of time even for earlier assessment years, i.e. even before 26.12.2004. The word other insurer provided in Section 101A(7) of the Insurance Act, 1938 enables the Indian insurers for re-insuring over and above the percentage fixed by the Insurance Regulatory And Development Authority of India. The re-insurance may be either with Indian reinsurer or other insurer as defined in Section 2(9). By taking advantage of the term other insurer , now the assessee claims that they can re-insure with non-resident re-insurance company ignoring the provisions of Section 2(9) of the Indian Insurance Act, 1938. This Tribunal is of the considered opinion that there is no merit in the contention of the Ld. Sr. counsel for the assessee. The term other insurer as provided in Section 101A(7) of the Insurance Act, 1938 refers only the insurer as defined in Section 2(9) of the Insurance Act, 1938. There cannot be any extended meaning which can be given to the term other insurer . The definition given in Section 2(9) of Insurance Act, 1938 is not inclusive one. It is an exhaustive one. Therefore, an Indian ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provisions of Insurance Act, 1938. Section 2(9) of the Insurance Act, 1938 was amended by Insurance Laws (Amendment) Act, 2015. Therefore, the contention of the Ld. Sr. counsel for the assessee that the provisions of Section 2(9) of Insurance Act, 1938, as it stood before 2014, is not applicable to the assessee-company has no merit at all. This Tribunal is of the considered opinion that the provisions of Section 2(9)(c) of Insurance Act, 1938 is very much applicable to the re-insurance business, therefore, the profit of non-resident re41 insurance company or the person in India who has standing contract with underwriters, who are members of the Lloyds, is taxable in India. Hence, the assessee has to necessarily deduct tax on the premium paid to non-resident re-insurance company for reinsurance. Even otherwise, if the assessee claims that there was no person in India, who has standing contract with underwriters who are members of the Lloyds and premium was paid directly to nonresident re-insurance company, then the transaction of the assessee is clearly in violation of provisions of Section 2(9)(c) of Insurance Act, 1938. In other words, the entire re-insurance arrangement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeals) are set aside and that of the Assessing Officer are restored. 37. The next issue arises for consideration is amortization of premium on securities. This issue arises for consideration in the assessee s appeals for assessment years 2004-05 to 2013-14. 38. Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee, submitted that the CIT(Appeals) decided the issue against the assessee by following his own order for assessment year 2003-04. On appeal by the assessee against the order of the CIT(Appeals) for assessment year 2003-04, according to the Ld. Sr. counsel, this Tribunal confirmed an identical order of CIT(Appeals). 39. We heard Shri M. Swaminathan, the Ld. Sr. Standing Counsel also. This Tribunal for the assessment year 2003-04, confirmed a similar disallowance towards amortization of premium on securities. For the reason stated by this Tribunal for assessment year 2003-04 in I.T.A. No.801/Mds/2007, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. 40. The next issue arises for consideration is disallowance of provision created towards claim incurred but not reported and clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re not ascertained. What was reported to the assessee is damage / loss caused to the insured persons. According to the Ld. Sr. Standing Counsel, the assessee is yet to assess the loss and determine the amount to be compensated, therefore, it is unascertainable liability. What is to be allowed under the Income-tax Act is ascertainable liability and not the unascertainable liability. In this case, according to the Ld. Sr. Standing Counsel, at the best, the assessee may claim that there is a liability for compensation. But, the amount of compensation is not quantified on the last day of the financial year. Therefore, according to the Ld. Sr. Standing Counsel, it has to be allowed in the year in which the liability was quantified. Referring to the order of the CIT(Appeals), the Ld. Sr. Standing Counsel it is not known how much amount was actually paid by the assessee towards compensation. No details were available even after long time. Therefore, according to the Ld. Sr. Standing Counsel, it has to be ascertained when the actual compensation or loss was quantified by the insurance company. The year in which the actual loss or compensation was quantified is the year in which the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g Counsel for the Revenue and Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee. The CIT(Appeals) by placing reliance on his own order for the assessment year 1998-99 to 2001-02 in the assessee's own case, directed the Assessing Officer to recompute the interest on accrual basis. Since the CIT(Appeals) directed the Assessing Officer to recompute the interest on accrual basis, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. 46. The next issue arises for consideration is profit on sale of investments. This issue arises for consideration in the Revenue s appeals for assessment years 2003-04, 2004-05, 2005-06, 2007-08 to 2013-14. This issue also arises for consideration in the assessee s appeals for assessment year 2011-12. 47. We heard Shri M. Swaminathan, the Ld. Sr. Standing Counsel for the Revenue and Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee. It was brought to the notice of this Tribunal that an identical issue was decided for assessment years 1985-86 to 1987-88, 1989-90 and 1997-98 in favour of the assessee. Since the co-ordinate Bench of this Tribunal has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, orders of both the authorities below are set aside and the issue of disallowance made by the Assessing Officer under Section 36(1)(viia)(c) of the Act is remitted back to the file of the Assessing Officer. The Assessing Officer shall reexamine the matter in the light of the material that may be filed by the assessee and thereafter decide the issue afresh in accordance with law, after giving a reasonable opportunity to the assessee. 51. The next issue arises for consideration is payment of survey fees to non-residents and reimbursement of expenditure. This issue arises for consideration in the Revenue s appeals for assessment year 2003-04, 2008-09, 2011-12, 2012-13 and 2013-14. 52. Shri M. Swaminathan, the Ld. Sr. Standing Counsel for the Revenue, submitted that the assessee has paid survey fees to the non-resident without deducting tax. Since tax was not deducted, according to the Ld. Sr. Standing Counsel, the Assessing Officer disallowed the claim of the assessee. However, the CIT(Appeals) allowed the claim of the assessee on the ground that the payment made to surveyors outside the country was not taxable in India and the surveyors did not make available any technical k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nathan, the Ld. Sr. Standing Counsel for the Revenue and Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee. Since Section 115JB is not applicable to the insurance companies, this Tribunal do not find any infirmity in the order of the CIT(Appeals). Accordingly, the same is confirmed. 57. The next issue arises for consideration is failure of the assessee to deduct tax in respect of commission payments. This issue arises for consideration in the Revenue s appeals for assessment years 2007-08 to 2013-14. 58. Shri M. Swaminathan, Sr. Standing Counsel for the Revenue, submitted that the assessee has paid commissions while accepting re-insurance premium from various other insurance companies in India. However, no tax was deducted while making the payment of commissions to the insurance companies. According to the Ld. Sr. Standing Counsel, it is the obligatory of the assessee to deduct tax while making commission payment in respect of re-insurance premium. Since tax was not deducted, according to the Ld. Sr. Standing Counsel, the Assessing Officer disallowed the commission paid to insurance companies in India under Section 194D of the Act. 59. On the contrary, Shr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ium, makes payment of commission. In this case, the respective insurance companies themselves act as agents and deduct the commission by themselves. Hence, the CIT(Appeals) has rightly allowed the claim of the assessee. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. 61. The next issue arises for consideration is provision towards Employees Short Term Benefits in the computation of book profit. This issue arises for consideration in the Revenue s appeals for assessment years 2008-09, 2009-10 and 2010-11. 62. Shri M. Swaminathan, the Ld. Sr. Standing Counsel for the Revenue, submitted that the assessee has made provision of _8 Crores towards Employees Short Term Benefits . According to the Ld. Sr. Standing Counsel, the assessee claimed before the Assessing Officer and the CIT(Appeals) that as per the Accounting Standard 15 issued by the Institute of Chartered Accountants of India, the assessee has made the provision. According to the Ld. Sr. Standing Counsel, the Accounting Standard issued by the Institute of Chartered Accountants of India has no statutory force. The assessee is exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... next issue arises for consideration is computation of MAT under Section 115JB of the Act. This issue arises for consideration in the Revenue s appeal for assessment year 2008-09. 66. Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee, submitted that the provisions of Section 115JB of the Act, which enables the Department to compute the income, is not applicable to insurance companies, therefore, there cannot be any addition to the book profit. According to the Ld. Sr. counsel, the insurance companies prepare Profit Loss account as per the guidelines issued by Insurance Regulatory And Development Authority of India and not as per Part II and III of Schedule VI of Companies Act. According to the Ld. Sr. counsel, the applicability of Schedule VI of the Companies Act was specifically excluded in respect of insurance companies. 67. We heard Shri M. Swaminathan, the Ld. Sr. Standing Counsel for the Revenue also. It is not in dispute that the applicability of provisions of Schedule VI of the Companies Act was excluded in respect of insurance companies. Therefore, the provisions of 115JB of the Act, which enables the companies to compute the book profit, may not be app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to have made the payment. The assessee has filed copies of invoice, confirmation letters from service providers and details of premium collected by the motor vehicle dealers from the customers. There is no doubt about the genuineness of service rendered by the car dealers. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. 72. The next issue arises for consideration is depreciation on investments. This issue arises for consideration in the assessee s appeal for assessment year 2005-06. 73. We heard Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee and Shri M. Swaminathan, the Ld. Sr. Standing Counsel for the Revenue. The CIT(Appeals) by placing reliance on the order of this Tribunal dated 18.08.2005 confirmed the disallowance made by the Assessing Officer. Right from the assessment year 1989-90 to 2004-05, similar claim of the assessee was disallowed. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. 74. The next issue arises for consideration is profit on sale / redemption of invest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is to the Pension Fund and not Superannuation Fund. The CIT(Appeals) found that the funds payable after the superannuation of an employee whether as one time settlement or monthly as a pension can be taken as superannuation funds. This Tribunal is of the considered opinion that Superannuation Fund is nothing but a fund created by the respective employer to compensate the employees who are retiring from service on superannuation. Therefore, the nomenclature of fund is immaterial. The benefit given to an employee by the employer on superannuation has to be construed as Superannuation Fund. Therefore, this Tribunal is unable to uphold the contention of the assessee that the Pension Fund is different from Superannuation Fund. Hence, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed. 80. The assessee has also taken one more ground with regard to failure of the Assessing Officer to give credit on the TDS amount. This issue arises for consideration for assessment year 2007-08. 81. We heard Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee and Shri M. Swaminathan, the Ld. Sr. Standin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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