TaxTMI 
TaxTMI 
2022 (11) TMI 118
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.... alia that: Assessee's appeal ITA No.1671/M/2022 "Based on the facts and circumstances of the case and in law, Life Insurance Corporation of India ('the Appellant'), respectfully craves leave to prefer an appeal against the order dated 30 April 2022passed by National Faceless Appeal Centre ('NFAC'), Delhi under section 250 of the Income-tax Act, 1961 ('Act') on the following grounds which are separate and without prejudice to each other: On the facts and in the circumstances of the case, the learned Assessing Officer ('AO')/NFAC has:- General ground 1. erred in confirming the action of the AO in making addition / disallowance to the extent of Rs.1008,53,93,000 while determining the total income of the appellant; Validity of reopening proceedings:- 2. erred in re-opening the assessment proceedings for the captioned Assessment Year ('AY') under section 147 of the Act without appreciating that the reopening proceedings are invalid and bad in law; 3. erred in re-opening the assessment proceedings beyond a period of four years from the end of the assessment year, without appreciating t....
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....n in the current year would lead to double taxation; 11. erred in adding interim bonus paid amounting to Rs. 1003,53,93,000 as disclosed in Form AR-A without appreciating the fact that difference in figure of surplus disclosed in Form AR-A was purely due to presentation requirements as per Insurance Regulatory and Development Authority ('IRDA') Regulations and therefore addition made by the learned AO is not warranted; 12. ought to have appreciated that the appellant has offered to tax the actuarial surplus as reported in Form - I for the income-tax purpose since its inception and the same has been accepted all along by all authorities and therefore deviating from the stand of earlier years would lead to violation of principle of consistency; Disallowance of claim of deduction under section 80G to tune of Rs. 5.00,00,000 13.erred in denying the claim of deduction under section 80G of the Act amounting to Rs. 5,00,00,000 (being 50% of Rs. 10,00,00,000, which is the amount actually paid); 14. ought to have appreciated that the appellant had fulfilled all the necessary conditions for claiming deduction under section 80G and had ther....
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....iness. Assessee corporation is required to pay corporation tax on valuation surplus declared by the actuary and computed the total chargeable income at Rs.1,70,29,59,48,781/-. 4. Originally assessment in this case was framed under section 143(3) of the Income Tax Act, 1961 (for short 'the Act') vide order dated 11.02.2013 by recording reasons and by way of issuance of notice under section 148 of the Act. Assessee was duly represented who was called upon to furnish working of disallowance under section 14A read with rule 8D as to why the disallowance under section 14A should not be disallowed. Declining the contentions raised by the assessee the Assessing Officer (AO) proceeded to make disallowance to the tune of Rs.3686.59 crore as against Rs.669.59 crore offered by the assessee under section 14A of the Act. AO also made addition of Rs.10,03,53,93,000/- qua the interim bonus paid to the total income of the assessee. AO also made disallowance of the claim or deduction claimed by the assessee under section 80G of the Act to the tune of Rs.5,00,00,000/- and thereby framed the assessment at the total income of Rs.18736,95,55,984/-. 5. Assessee carried the matter before the Ld. CI....
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....ention was invited to section 28 of the LIC Act and para 7.3 (page-18 of the impugned order). The Ld. CIT-DR defended the addition made by the Assessing Officer. 5.2. We have considered the rival submissions and perused the material available on record. Before adverting further, we are reproducing here under section 28 of the Life Insurance Corporation Act, 1956 for ready reference:- "28. Surplus from life insurance business how to be utilized.-- If as a result of any investigation undertaken by the Corporation under section 26 any surplus emerges, ninety-five per cent of such surplus or such higher percentage thereof as the Central Government may approve shall be allocated to or reserved for the life insurance policy-holders of the Corporation and after meeting the liabilities of the Corporation, if any, which may arise under section 9, the remainder shall be paid to the Central Government or, if that Government so directs, be utilised for such purposes and in such manner as that Government may determine.] [28A. Profits from any business (other than life insurance business) how to be utilized.-- If for any financial year profits accrue from any ....
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....ng following findings: "17. The next ground of appeal by the assessee is with respect to disallowance of claim of deduction under section 80G of the Act. The ld.Authorized Representative of the assessee submitted that the assessee had made donations to the tune of Rs.5.00 cores to LIC Golder Jubilee Foundation. The donation to said Foundation are eligible for deduction under section 80G. The assessee claimed deduction under section 80G to the extent of 50% of the amount contributed towards the Foundation. The ld. Authorized Representative of the assessee submitted that for the purpose of computation of income of insurance companies provisions of section 44 of the Act would apply. Section 44 starts with obstinate clause. Hence, the provisions of section 44 of the Act overrides the other provisions of the Act including provisions of sub-section(5A) of section 80G of the Act . The ld.Authorized Representative of the assessee referring to the provisions of section 44 of the Act submits that the non-obstinate clause is only to the extent of computation of income chargeable to tax under the heads mentioned in the section. The benefit of provisions of section 80G is claimed after....
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....g the fact that the assessing being in insurance business is covered by special provisions contained in Section 44 of the Act and hence, for Income Tax purpose compute income in accordance with rules contained in the First Schedule. 20. The Assessing Officer and the CIT(A) have denied the benefit of deduction under section 80G claimed by the assessee for the reason that the assessee has claimed double benefit of donation amount, first in computation of income and secondly in the form of deduction under section 80G after computation. The assessee has not refuted above contentions of the Revenue. It is a trait law that the Assessing Officer has no power to go behind accounts drawn in First Schedule applicable to insurance companies, however, the Assessing Officer can always examine correctness of the claim of the assessee with regard to deduction claimed after computation of income. The intent of Legislature while framing special provision for insurance companies can by no means be to allow the benefit of double deduction of the same amount. The CIT(A) in para 3.4.9 of the impugned order has illustrated the impact of assessess'e claim of donation as expenditure in P&L accoun....
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....t take the stand that no expenditure is disallowable u/s.14A r.w.r.8D. The Assessing Officer made disallowance of Rs.11636.73 crores u/s. 14A r.w.r. 8D on protective basis. In the first appellate proceedings the CIT(A) deleted the disallowance by following the decision of Tribunal rendered in the case of Birla Sunlife Insurance Co. Ltd. in ITA No.602/Mum/2009 for assessment year 2004-05 decided on 09/09/2010. The ld.Departmental Representative pointed that during the period relevant to the assessment year under appeal the assessee is earning income not only from insurance business, hence, the entire disallowance cannot be deleted. To substantiate his points the ld.Departmental Representative referred to the observations made by CIT(A) in page 48 and 50 of the impugned order. The ld. DR asserted that the decision rendered in the case of Birla Sunlife Insurance Co. Ltd.(supra) is in respect of income from Insurance business only, therefore the said decision would not apply to the facts of present case. 9. Submissions made by ld.Departmental Representative heard. We find that in para 48 and 50 of the order of CIT(A) referred to by the ld. Departmental Representative is the re....