TaxTMI 
TaxTMI 
2023 (8) TMI 276
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.... limitation and has challenged the grounds of addition of Rs. 25,73,185/- made on accretion in value of the policy received on surrender and on the disallowance of long term capital gain amounting to Rs. 15,15,268/- by not treating the unit linked market plus policy of LIC as 'capital asset' within the meaning of section 2(14) of the Act. 3. As there was no representation on behalf of the assessee, we hereby proceed to hear this appeal by hearing the learned Departmental Representative (ld. DR for short) for the Revenue and on perusal of the materials available on record. 4. The brief facts of the case are that the assessee is an individual and has filed his return of income on 27.09.2014, declaring total income of Rs. 5,52,030/- and the ....
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....f Rs. 50 lacs and opted for 'BOND' option of the said policy. The assessee was allotted 470262.703 units at its NAV. The assessee is said to have surrendered the policy during the impugned year and had received Rs. 75,73,185/- as maturity proceeds for all the units which are redeemed at its NAV as on the date of the surrender. The assessee in its return of income has shown this under the head 'income from capital gains' by treating ULIP as 'capital asset' as per the provision of section 2(14) of the Act. During the assessment proceeding, the A.O. has treated the same as 'income from other sources' and had made the impugned addition of Rs. 25,73,185/- being accretion in the value of the policy. The A.O. treated the policy as unit linked diff....
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....in' treating the said policy as a capital asset u/s. 2(14) of the Act and the same is reflected in the balance sheet of the assessee from A.Y. 2007-08 to A.Y. 2014-15. The assessee further contended that the same cannot be taxed u/s. 80CCC(2) of the Act as the amount of premium paid by the assessee was not claimed as 'deduction' u/s. 80CCC(1) of the Act. It is also pertinent to point out from the assessee's submission that ULIP is treated as 'capital asset' as per the Finance Act, 2021 which further substantiates the claim of the assessee. It is relevant to consider clause (c) of section 2(14) of the Act which has defined capital asset and has included any unit linked insurance policy to which exemption under clause 10D of section 10 does n....