https://www.taxtmi.com/caselaws?id=187208 A deduction for amounts reserved for policy-holders under rule 3(a) is available only when an insurer voluntarily applies a disposable surplus for their benefit. Where the amount must be credited to the life insurance fund under a statutory obligation to meet existing and contingent liabilities, it is not a voluntary reservation out of free surplus and does not qualify. The Bombay HC held that the sum required to make good an actuarial deficit was not an amount reserved for policy-holders, so no deduction was allowable and the Revenue's view on deductibility was upheld. en-us Wed, 01 Aug 1956 00:00:00 +0530 Thu, 13 Oct 2016 16:55:20 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=187208 A deduction for amounts reserved for policy-holders under rule 3(a) is available only when an insurer voluntarily applies a disposable surplus for their benefit. Where the amount must be credited to the life insurance fund under a statutory obligation to meet existing and contingent liabilities, it is not a voluntary reservation out of free surplus and does not qualify. The Bombay HC held that the sum required to make good an actuarial deficit was not an amount reserved for policy-holders, so no deduction was allowable and the Revenue's view on deductibility was upheld. Case-Laws Income Tax Wed, 01 Aug 1956 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=187208