TMI Blog2021 (2) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... ned in the provisions of the Income-tax Act relating to the computation of income chargeable under different heads. For computing the profits and gains of the business of insurance company, the AO had to resort to section 44 and the prescribed rules, and could not have applied section 28 to 43B, since the same were excluded from the purview of section 44. This necessarily includes the exception provision enshrined under section 14A of the Act. Therefore, in our view, the AO could not have travelled beyond section 44 in the first schedule of the Act. Disallowance u/s. 14A of the Act in the proceedings u/s. 154 - HELD THAT:- In AY 2012-13 the AO himself dealt with this issue in the proceedings u/s. 154 of the Act dated 23.03.2016 and spe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 (23AAB) be excluded while determining surplus as per actuarial valuation surplus u/s 44 - Decided in favour of assessee. - IT (TP) A No. 1296 & 1297/Bang/2016, ITA Nos. 838 & 840/Bang/2019 - - - Dated:- 3-2-2021 - SHRI CHANDRA POOJARI , ACCOUNTANT MEMBER AND SMT. BEENA PILLAI , JUDICIAL MEMBER Appellant by : Smt. Tanmayee Rajkumar , Advocate Respondent by : Shri Muzaffar Hussain , CIT(DR) (ITAT), Bengaluru ORDER Per Chandra Poojari , Accountant Member IT(TP)A Nos.1296 1297/Bang/2016 are cross appeals by the assessee and revenue against the order dated 27.04.2016 of the CIT(Appeals)-14, LTU, Bangalore for the AY 2011-12. ITA Nos. 838 840/Bang/2019 are appeals by the assessee against the separate orders, bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urance Co. Ltd. in ITA No.172/2020. The Hon ble High Court vide judgment dated 4.3.2020 in para 9 held as under:- 9. We have heard learned counsels and are of the view that no substantial question of law arises for our consideration. The Tribunal has interpreted section 44 read with the first schedule and concluded that applicability of section 14A is excluded in relation to computation of income of an insurance company. We have examined the relevant provisions. Section 44 begins with a non-obstante clause and overrides the other provisions of the Act as mentioned therein including section 14A. We are not convinced with the submission of Mr. Ajit Sharma that section 14A would be applicable in respect of the Respondent. Section 14A does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al has prevailed in respect of the earlier assessment years i.e. 2000-01, 2001-02 and 2005-06. 10. We also do not find merit in the submission of Mr. Sharma that the Tribunal should have remanded back the matter to the Assessing Officer for computation of income of the Respondentassessee in terms of first schedule of the Act, since that was not even a ground urged by the Revenue before the Tribunal. At this stage, it is too late in the day for the Revenue to argue that notwithstanding the grounds urged to challenge the order of the CIT (A), the Tribunal should have ventured into examining the merits of the computation of income of the Respondent assessee in terms of section 44 read with the first schedule of the Act. No doubt, the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding in the first ground of appeal with regard to disallowance u/s. 14A of the Act and accordingly the same is dismissed as infructuous. 8. Thus, all the assessee s appeals are allowed. 9. In the revenue s appeal, the issue in ground No.2 is with regard to allowing relief in respect of provisions of section 10(23AAB) of the Act. The AO did not allow the loss of ₹ 95,42,99,278 incurred from pension fund which is exempt u/s. 10(23AAB) of the Act to be excluded while determining the actuarial valuation surplus u/s. 44 of the Act. The CIT(Appeals) allowed the appeal of the assessee on this issue by placing reliance on earlier order of the CIT(Appeals), LTU in assessee s own case for AY 2009-10 and also the judgment of Hon ble Bombay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surance. Therefore, we are of the view that stand taken by the DRP cannot be accepted. We, therefore, direct that loss from pension fund which is exempt u/s10 (23AAB) be excluded while determining surplus as per actuarial valuation surplus u/s 44 of the Act. Ground II raised by the assessee is allowed. 11. Taking a consistent view, we are inclined to decided the issue in favour of the assessee and against the department. Hence this ground of revenue is dismissed. 12. Ground No.3 relates to disallowance u/s. 14A of the Act, which we have considered in assessee s appeal in ITA No.1296/Bang/2016 wherein it has been held that in case of an assessee being an insurance company, there is no application of the present section 14A r.w. Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X
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