The Tax Publishers2020 TaxPub(DT) 4887 (Mum-Trib)

INCOME TAX ACT, 1961

Section 10(34)

Taxing dividend income in the hands of insurance company would be unjustified and would run contrary to provisions of the Act, therefore, exemption under section 10(34) could not be denied to assessee.

Exemption under section 10(34) - Allowability - Dividend income earned by insurance company -

Assessee engaged in the business of iife insurance, earned dividend income of Rs. 17 lakhs and claimed the same to be exempt under section 10(34). AO took the view that since income in case of insurance business was to be computed in terms of provisions of section 44, which starts with non-obstante clause, therefore, dividend income as offered under the head income from other sources could not be taken as separate from profit and gains of insurance business and therefore, exemption under section 10(34) being in contradiction with non-obstante provisions of section 44 same would not be allowable to assessee.Held: Taxing dividend income would be unjustified and would run contrary to provisions of the Act, therefore, exemption under section 10(34) could not be denied to assessee.

Followed:Pr. CIT v. ICICI Prudential Life Insurance Co. Ltd. for assessment years 2010-11 & 2011-12 (ITA Nos.1305 & 1306 of 2015 dated 03-7-2018).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2012-13


INCOME TAX ACT, 1961

Section 14A

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