9911796707
TMI Blog2025 (3) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... ,000/- in the computation of income under normal provisions of the Act; b. Rs. 13,45,79,000/- being amortization of premium paid on purchase of securities. 2. The CIT(A) erred in upholding the disallowance of the provision made by the Appellant for claims made towards IBNR and IBNER as an contingent/unascertained liability and therefore not allowable u/s 37(1) of the Act even though the provisions were made based on scientific evaluations by a registered and approved actuary and in accordance with the directions of the Appellant regulator viz., the IRDAI. 3. The CIT(A) failed to appreciate that the amortization of premium paid on purchase of securities is neither an expense nor an allowance that can be disallowed under Rule 5 of First Schedule of Act and that the AO as per the provisions of Section 44 of the Act has the power to disallow only the expenses which are not admissible under the provisions of section 30 to 438 of the Act. 4. The CIT(A) failed to appreciate that in respect of investments for which amortization of premium has been claimed: (a) related interest is offered to income; (b) the amortization of premium is directly linked to the interest; and (c) gains on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee carries on General Insurance business in accordance with the law as laid down by the legislature and the Insurance Regulatory and Development Authority of India ('IRDAI'). Its shares are fully owned by the Government of India (Ministry of Finance) and are under the administrative control of the Insurance Division of Department of Financial Services (Ministry of Finance), Government of India. The assessee, being an insurance company is assessable to income tax as per section 44 of the Income Tax Act, 1961 ("the Act") which is a complete code by itself. The assessment was completed and order u/s 143(3) of the Act was passed on 26th September 2022, wherein the following additions / disallowances, were made by the Assessing Officer. No. Particulars Amount (Rs.) Under the normal provisions of the Act (i) Default in TDS payment u/s 200A of the Act 4,13,03,271 (ii) Reinsurance Premium paid to reinsurers situated overseas u/s 40(a)(i) of the Act 1322,83,76,744 (iii) Provision made towards IBNR/IBNER Claims 1582,52,00,000 (iv) Amortization of premium paid on securities 13,45,79,000 (v) Commission paid to non-residents u/s 40(a)(ia) of the Act 6,24,13,2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal is pending before High Court. Para 8-9 (Page Nos. 9-11 of the Order) (iv) Disallowance 40(a)(i) in respect of commission paid to non-resident agents Allowed in favor of the assessee by the ITAT and upheld by the High Court. Para 20 (Page 36-38 of the Order) (v) Survey fees paid Allowed in favor of the assessee by the ITAT and upheld by the High Court. Para 21 (Page 39-40 of the Order) However, the ld. Counsel for the assessee pointed out that on the issue of disallowance of provision towards IBNR/IBNER claims, the order of the Co- ordinate bench of the Tribunal in 1085/Chny/2017 dated 19.07.2024 & ITA No.1585/Chny/2019 dated 19.07.2024 passed in the cases of the assessee has been diluted by the Co-ordinate bench in the case of DCIT Vs M/s Royal Sundaram General Insurance Company Limited [ITA Nos.493, 494, 495 & 496/Chny/2018 for AYs 2011-12, 2012-13, 2013-14 & 2014-15 vide order dated 08.01.2025 following the judgments of the Hon'ble Delhi High Court, Hon'ble Bombay High Court and other benches of Tribunal viz; Delhi, Kolkata and Mumbai. 6. Per contra, the ld. Senior Standing Counsel Ms. Pushpa, Advocate for revenue vehemently argued that the order of the Co-ordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to assess loss and determine amount to be compensated. Therefore, it is unascertained liability and same cannot be allowed as deduction. The Sr. Standing Counsel further submitted that this issue is covered by the decision of the ITAT., Chennai in assessee's own case for earlier assessment years, where the Tribunal has held that provision made for IBNR and IBNER is not deductible, because merely incident happened during the year which is basis for making claim, that cannot be a reason for allowing compensation payable by the assessee in the subsequent financial years. 13. After hearing both the parties and going through the material on records, we find that an identical issue has been considered by the Tribunal in assessee's own case in ITA Nos. 2107/Chny/2008 &Ors. vide order dated 28.08.2018 for relevant assessment years and after considering relevant facts held that provision for IBNR & IBNER is not deductible u/s. 37(1) of the Income Tax Act, 1961, because such provision is only on unascertained liability, which is not accrued to the assessee for the relevant assessment year. The relevant findings of the Tribunal are as under:- "43. We have considered the rival submissions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. The assessee submitted that the additional amount of Rs. 1582.58 crores being the amount not debited to the profit & loss account be deleted. We are in conformity with the views of the assessee that amount of monies, as provisions, not debited to the profit & loss account cannot be a part of the disallowance. Accordingly, the AO is directed to recalculate the disallowance with respect to provisions for IBNR and IBNER claims and restrict it to the extent of the amounts debited to profit & loss account as per law during the assessment year 2017-18. Accordingly, the grounds of appeal raised by the assessee on this issue for AYs 2014-15 to 2016-17 and 2018-19 & 2019-20 are dismissed and that of the AY 2017-18 is treated as allowed for statistical purposes''. However, we also find that order of the Co-ordinate bench of the Tribunal in ITA No.1585/Chny/2019 dated 19.07.2024 in the case of the assessee has recently been diluted by the Co-ordinate bench in the case of DCIT Vs M/s Royal Sundaram General Insurance Company Limited [ITA Nos.493, 494, 495 & 496/Chny/2018 for AYs 2011-12, 2012-13, 2013-14 & 2014-15 vide order dated 08.01.2025 following the judgments of the Hon'ble Delhi H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue heavily relied upon the decision of the Hon'ble Co-ordiante Bench of this tribunal in the case of United India insurance company limited vide ITA No.1085/Chny/ 2017 dated 19.07.2024 and invited our reference to the following parts of the decision and accordingly requested for restoring the order of the Ld. Assessing Officer:- "......10. The next common issue that came up for our consideration in the appeals of the assessee for the assessment years 2014-15, 2015-16, 2016-17, 2017-18, 2018-19 & 2019-20 is disallowance of provision for IBNR and IBNER. 11. The learned counsel for the assessee submitted that during the relevant assessment years, the assessee has made provision for claims incurred, but were not reported (IBNR) and claims incurred, which were not enough reported (IBENR) and such provision has been made for all unsettled claims on the basis of claim lodged by insured persons. According to the learned counsel, date of damage/loss was considered for recognizing the claim in a particular year. In certain circumstances, damages / loss were not reported in the balance sheet of the insurance company and such claims are known as claims incurred, but not reported. Sometimes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loss was reported to the assessee but the actual loss or compensation was not determined during the assessment year 2009- 10. Therefore, as rightly submitted by the according to the Ld. Sr. Standing Counsel for the Revenue, the liability to make the payment accrues to the assessee only in the year in which the loss or damage was ascertained and compensation payable to insured person is determined. Admittedly, the compensation payable to insured person was not determined during the assessment year 2009-10. Therefore, this Tribunal is of the considered opinion that merely because the incident happened during the year which is the basis for making claim, that cannot be a reason for allowing the compensation payable by the assessee for the assessment year 2009-10. In other words, the compensation payable by the assessee has to be allowed in the year in which the amount of compensation was determined. Since the amount was not determined during the year under consideration, this Tribunal is of the considered opinion that the same cannot be allowed for assessment year 2009-10. Hence, the CIT(Appeals) is not correct in allowing the claim of the assessee. Accordingly, the order of the CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Hon'ble Apex Court in the case of Vegetable Products. 13.3 Hon'ble Coordinate Bench of ITAT, Mumbai in the case of M/s.TATA AIG general insurance company limited ITA no.14 / mum/ 2021 dated 08.03.2022 has ruled as under:- ".....06. The learned Departmental Representative vehemently supported the order of the learned Assessing Officer and merely referred to the order of the learned Assessing Officer and learned CIT (A) stating relevant paragraph of the issues involved. It was submitted that the issues are decided in favour of the assessee by the co-ordinate Bench in assessee's own case; however, the above disallowance should not have been deleted by the learned Commissioner of Income-Tax (Appeals) for the reason given in assessment order y the ld AO. He extensively referred assessment order on all these [3] issues. 07. 08. 09. The Authorised Representative submitted that the appeal of the Revenue deserves to be dismissed in view of the issues already decided in favour of the assessee by the co-ordinate Bench in assessee's own case for earlier years as well as in case of other insurance companies involving similar issues. He placed on record the decision of ITAT in assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the liability incurred by the assessee company is allowable. He further held that the methodology to determine the liability is also certified by actuary in accordance with guidelines and norms issued by the Institute of actuaries of India and insurance regulatory and development authority of India. He further held that such provisioning relates to present obligation and involves outflow of resources. He further considered the provisioning made by the assessee in different years and actual utilization of such provision with respect to those financial years and then he found that the provision was made less than the actual amount incurred in settling those claims. He further held that the coordinate bench in case of DCIT vs. National Insurance co. Ltd. (2016) 72 taxmann.com 116 (Kolkata p Trib.) which has been affirmed by Hon'ble Calcutta High Court in ITA No.76 of 2019. Therefore he held that such provisioning is allowable u/s 37 (1) of the act and the addition made by the learned AO was deleted. 012. We have carefully considered the rival contentions and perused the orders of the lower authorities. The facts show that during the year the assessee has made a provision of Rs.14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e identical claims. The learned CIT(A) while deciding the issue has relied upon the decision co-ordinate Bench in DCIT vs. National Insurance Company Limited (supra) has held that the provisions made available the above claim are based on scientific calculation with a proper and rational and therefore, it could only be termed as ascertain liability. Though the above decision was rendered with respect to the computation of book profit under section 115JB of the Act, however, the learned CIT (A) applied it and allowed the claim of assessee for deduction under section 37(1) of the Act for the reason that the claim of the assessee is ascertained claim, supported by Actuarial valuation and also made on a scientific basis. To reach at this calculation, the learned CIT (A) obtained information for 6 different assessment years and found that the actual claim settled is always higher than the provisions made by the assessee. This it shows that the provisions made are not excessive. Further, it was stated before us that this claim is allowed to the assessee from year to year. In view of this, we find that assessee has incurred an expenditure, which is incurred during the year with respect to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treating the same was unascertained liability whi1e computing the book profits u/s115JB of the Act. The revenue was not able to controvert the findings given by the Ld CITA before us. Hence, we find no infirmity in the order of the Ld. CITA in this regard and accordingly dismiss the Ground No. l raised by the revenue." Thus, as said provision has been created by it to meet ascertained liabilities, the Company is entitled to claim a deduction of the same IT APPEAL NOS. 674, 982 & 983 (KOL.) OF 2012 while computing its income under the head 'profits & gains from business and profession'. Therefore, respectfully following the decision of the Hon'ble ITAT in the case of National Insurance above, I do not find any merit in the addition made by the AO in this case. Hence, this ground of appeal is allowed." 14. We have heard both the parties and perused the records. In the light of the assessee's submissions herein above, we find that ld. CIT (A) has taken correct decision, which does not need any interference on our part. The case law from Kolkata Bench of ITAT duly holds that these are ascertained liabilities. Hence, we uphold the order of ld. CIT (A). " 7. The compu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eserve (a) The incurred but not reported (IBNR) claims reserve shall be determined using actuarial principles and methods detailed in clause 4 below (b) The IBNR shall be estimated using appropriate actuarial principles and shall be certified by the Appointed Actuary. (c) The Appointed Actuary shall estimate IBNR on both net of reinsurance and gross of reinsurance basis. (d) The Appointed Actuary shall estimate the provision for IBNR for each year of occurrence and the figures shall be aggregated to arrive at the total amount to be provided. (e) If estimate of IBNR provision for any year of occurrence is negative, the Appointed Actuary shall reexamine the underlying assumptions. Even after re-examination, if the mathematics produces negative value, the Appointed Actuary shall ignore the IBNR provision for that year of occurrence. (f) The estimation process shall not discount the estimated future development of paid claims to the current date." 9. While dealing with IBNR claims reserve, Clause 3(3) of Schedule II provides that IBNR would be estimated by usage of appropriate actuarial principles. IBNR itself is to be estimated on the basis of a study undertaken by an app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, the Supreme Court was concerned with whether a standard warranty which had been provided by the assessee in respect of claims likely to arise could be construed to be a contingent liability and thus not allowable as a deduction under Section 37. 12. While expounding upon the concept of a provision being made in the books of account, the Supreme Court pertinently observed as follows:- "22. What is a provision? This is the question which needs to be answered. A provision is a liability which can be measured only by using a substantial degree of estimation. A provision is recognised when: (a) an enterprise has a present obligation as a result of a past event; (b) it is probable that an outflow of resources will be required to settle the obligation; and (c) a reliable estimate can be made of the amount of the obligation. If these conditions are not met, no provision can be recognised. 23. Liability is defined as a present obligation arising from past events, the settlement of which is expected to result in an outflow (2009) 13 SCC 283 from the enterprise of resources embodying economic benefits. A past event that leads to a present obligation is called as an obligating event. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied in this case. " 13. As is evident from the principles enunciated above, the Supreme Court explained the concept of provisioning for liabilities as being based upon a present obligation which may come to be owed by an enterprise as a result of a past event and the probability of an outflow of resources that may be required to settle that obligation. One of the crucial aspects which was highlighted in this regard was of the enterprise being entitled to make a reliable estimate and whether such an estimation could be made of the amount that may be ultimately owed on account of the obligation. Apart from obligations flowing from past events, the Supreme Court also recognized the concept of historical trends and those justifying the making of an appropriate provision. Historical trend was acknowledged to be a study of defects detected over a period of time and the data collated in respect thereof. The concept of historical trends was explained as under:- "35. In the present case, the High Court has principally gone by the judgment of the Supreme Court in Shree Sajjan Mills [(1985) 4 SCC 590 : 1986 SCC (Tax) 82 : (1985) 156 ITR 585]. That was the case of gratuity. For Assessment Y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Tax) 82 : (1985) 156 ITR 585]. The position got altered only after 1-4-1973. Before that date, provision made in the profit and loss account for the estimated present value of the contingent liability properly ascertained and discounted on an accrued basis could be deducted either under Section 28 or Section 37 of the 1961 Act. This has been explained in Shree Sajjan Mills [(1985) 4 SCC 590 : 1986 SCC (Tax) 82 : (1985) 156 ITR 585] at p. 599. 39. Section 40-A(7) deals only with the case of gratuity. Even in the case of gratuity but for insertion of Section 40-A(7), provision made in the profit and loss account on the basis of present value of the contingent liability properly ascertained and discounted on an accrued basis was entitled to deduction either under Section 28 or under Section 37 of the said Act. This aspect, therefore, indicates that the present value of the contingent liability like the warranty expense, if properly ascertained and discounted on accrued basis, could be an item of deduction under Section 37 of the said Act. This aspect is not noticed in the impugned judgment. 40. We may add a caveat. As stated above, the principle of estimation of the contingent l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 585] up to 1-4-1973. " 14. What follows from the above is the right of an enterprise to make provisions for a liability which could be measured by and as the Supreme Court described a "substantial degree of estimation". It was thus held that as long as a liability is properly ascertainable on the basis of empirical data or a known methodology, the same cannot possibly be held to be a contingent liability. 15. The Supreme Court ultimately in Rotork Controls held as follows:- "47. At this stage, we once again reiterate that a liability is a present obligation arising from past events, the settlement of which is expected to result in an outflow of resources and in respect of which a reliable estimate is possible of the amount of obligation. As stated above, Indian Molasses Co. [AIR 1959 SC 1049 : (1959) 37 ITR 66] is different from the present case. As stated above, in the present case we are concerned with an army of items of sophisticated (specialised) goods manufactured and sold by the assessee whereas Indian Molasses Co. [AIR 1959 SC 1049 : (1959) 37 ITR 66] was restricted to an individual retiree. On the other hand, Metal Box Co. of India [AIR 1969 SC 612 : (1969) 73 ITR 53] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . A lucid explanation of the concept of contingent liabilities is then found in The Commissioner of Income Tax vs. Whirpool of India Ltd. 10 In the facts of that case, this Court found that the assessee there had been consistently making provisions on the basis of actuarial valuation in respect of machines sold and warranty claims lodged. Both the AO as well as the CIT(A) in that case had taken the view that claims pertaining to unexpired periods of warranty could be considered only when actual claims may arise and that the assessee would not be justified in estimating a warranty liability. 17. While dealing with this aspect, the Court observed:- "14. We may take note of a decision of this Court in CIT Vs. Vinitec Corporation (P) Ltd. 278 ITR 337 which is referred by the Tribunal also. In that case the assessee had claimed deduction under Section 37 of the Act, inter alia, on the provision made by it in the year against future claims by customers under the warranty clause which was part of the sale. The AO disallowed the claim on the ground that it was a contingent liability. The Tribunal, however, accepted the assessee's claim holding that the liability was definite and certain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the entitlement earned by employees of the company, inclusive of the officers and the staff, subject to the ceiling on accumulation as applicable on the relevant date, is entitled to deduction out of the gross receipts for the accounting year during which the provision is made for the liability. The liability is not a contingent liability. The High Court was not right in taking the view to the contrary. The appeal is allowed. The judgment under appeal is set aside. The question referred by the Tribunal to the High Court is answered in the affirmative, i.e. in favor of the assessed and against the Revenue." It will be useful for us to make a reference to the judgment of the Privy Council in the case of Commissioner of Inland Revenue (supra) where the Privy Council dealing with a taxpayer who was selling new motor vehicles to the dealers to indemnify them against warranty claims which, in turn, resulted in providing of warranty clause for 12 months from the date of delivery to the purchaser by the dealer, held as under :- "Held, dismissing the appeal, that, although the taxpayer's liability under the warranty for each vehicle sold was contingent on a defect appearing an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses incurred subsequently. (b) A detailed assessment of the warranty provisioning policy is required particularly if the experience suggests that warranty provisions are generally reversed if they remained unutilized based on past experience. (c) The warranty provision for the product should be based on estimate at year end of future warranty expense. This becomes clear from the following discussion in the said judgment:- "For determining an appropriate historical trend, it is important that the company has a proper accounting system for capturing relationship between the nature of the sales, the warranty provisions made and the actual expenses incurred against it subsequently. Thus, the decision on the warranty provision should be based on past experience of the company. A detailed assessment of the warranty provisioning policy is required particularly if the experience suggests that warranty provisions are generally reversed if they remained unutilized at the end of the period prescribed in the warranty. Therefore, the company should scrutinize the historical trend of warranty provisions made and the actual expenses incurred against it. On this basis a sensible estimate sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd on this Court in view of the decision of Chennai Bench of the Tribunal in the case of United India Insurance Co. Ltd. v. Jt. CIT [2018] 97 taxmann.com 466. We note that the Chennai Bench decision of the Tribunal has ignored the co-ordinate bench decision of Mumbai and Kolkata benches of the Tribunal. Therefore, prima facie per incurium. In any case the CBDT Circular No. 530 dated 6 March 1989 states that stay of demand be granted where there are conflicting decisions of the High Court. This principle can be extended to the conflicting decisions of the different benches of the Tribunal. Thus, in the above facts the complete stay of the demand on the above head i.e. Item No.1 of the above chart was warranted in the Petitioner's favour...." 13.6 The above judicial ratios were not available on records while adjudicating the appeal in the case of United India Insurance supra as at ITA 1085/Chny/2017 dated 19.07.2024. The matter of allowance of IBNR and IBNER as an ascertained liability or as an unascertained liability has been considered. It is noted that in the case of appellant assessee the same meets the criteria laid down by the Hon'ble Coordinate Benches of Kolkata, Delhi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2013-14 to 2019-20. The learned counsel for the assessee submitted that similar issue had been raised by the assessee for consideration in the assessment year 2003-04, wherein the Ld.CIT(A) decided the issue against the assessee by following his predecessor's order and on further appeal, the Tribunal confirmed the order of the CIT(A). Even in subsequent assessment years 2004-05 to 2013-14 also, the Tribunal decided the issue of amortization of premium paid on purchase of securities against the assessee. Pertinently, in ITA No.2107/Chny/2008, in assessee's case for AY 2004-05, the co-ordinate Bench of this Tribunal has observed as under:- "37. The next issue arises for consideration is amortization of premium on securities. This issue arises for consideration in the assessee's appeals for assessment years 2004-05 to 2013-14. 38. Shri P.H. Arvindh Pandian, the Ld. Sr. counsel for the assessee, submitted that the CIT(Appeals) decided the issue against the assessee by following his own order for assessment year 2003-04. On appeal by the assessee against the order of the CIT(Appeals) for assessment year 2003-04, according to the Ld. Sr. counsel, this Tribunal confirmed an identi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble High Court, in favour of the assessee and dismissed the ground raised by the revenue by following the earlier decision of the Tribunal in ITA Nos.1673, 1688, 1689, 1691/Chny/2011 dated 26.08.2022 in assesses own case for assessment years 2003-04 to 2006-07 and 2008-09 to 2010-11. The Learned Sr.Standing Counsel for the Revenue also fairly agreed that this issue is covered in favour of the assessee by the decision of this Tribunal in assessee's own case for earlier assessment years. 6. We find that an identical issue has been dealt with by the co-ordinate Bench of this Tribunal in assessee's own case in ITA No.1692/Chny/2011 dated 28.06.2023 by following the earlier decision of the Tribunal in ITA Nos.1673, 1688, 1689, 1691/Chny/2011 dated 26.08.2022 in assessee's own case came to the conclusion that reinsurance premium ceded to NRRs, is not taxable in India under the Income Tax Act, 1961 or under DTAA between India and respective countries, where the NRRs are tax residents, and thus, reinsurance premium cannot be disallowed u/s. 40(a)(i) of the Act, for non-deduction of TDS u/s. 195 of the Act. The relevant portion of the findings of the Tribunal in para 6 & 7 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erms of para 3.5 of IRDAI (General insurance, Reinsurance) Regulation, 2000. As per IRDAI Regulation, 2000, the insurance companies in India have to mandatorily reinsure with the Indian reinsurer being General Insurance Corporation (GIC). However, over and above specified percentage of reinsurance, general insurance companies in India can have their reinsurance arrangement with foreign reinsurer in terms of para 3.7 of said regulations. In this case, there is no dispute with regard to fact that the assessee has complied with provisions of Insurance Act, 1938 and regulations made there under by the IRDAI. In fact, the Assessing Officer has accepted fact that the assessee has complied with reinsurance regulations by taking required percentage of reinsurance contract with General Insurance Corporation of India. But disputed reinsurance premium ceded to non-resident reinsurer companies. In the earlier round of litigation, the Tribunal had discussed the issue of payments made to non-resident reinsurer, in light of provisions of section Insurance Act, 1938 and IRDAI Regulations on reinsurance and concluded that the assessee has violated provisions of Insurance Act, 1938 and consequently, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mium ceded to NRRs u/s 40(a)(i) of the Act. 7. In this view of the matter and consistent with view taken by the coordinate Bench in the assessee's own case, we are inclined to uphold the findings of the Ld.CIT(A) and direct the AO to delete the disallowance of reinsurance premium paid to NRRs u/s. 40(a)(i) of the Act, for failure to deduct TDS u/s. 195 of the Act." 7. In view of the above, respectfully following the said decision of the coordinate Bench of this Tribunal, we set aside order of the Ld.CIT(A) in restricting the claim of the assessee to 15% of payment made to NRRs of other countries and direct the Assessing Officer to delete the additions made towards disallowance of reinsurance premium ceded to NRRs u/s. 40(a)(i) of the Act for the assessment years2013-14 to 2016-17. Thus, the ground raised by the assessee on this issue for the assessment years 2013- 14 to 2016-17 is allowed and that of the Revenue for the assessment years 2017-18 to 2019-20 is dismissed''. Hence, respectfully following the Co-ordinate bench order in assessee's own case up to AY 2019-20, we decide this ground in the favour of the assessee. Accordingly, this ground of revenue is dismissed. Disall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of M/s. Royal Sundaram Alliance Insurance Company Ltd. In TCA No.41 of 2019, held that assessee is not liable to deduct tax at source, qua, payments made to overseas surveyors. The Ld. Sr. Standing Counsel has fairly agreed that the issue is decided against the Revenue. 20.1 Heard rival submissions and perused materials available on record. It emerges from record that assessee is not paying any commission to insurance companies and such commission was deducted by respective insurance companies themselves from reinsurance premium. Therefore, when the assessee is not making payment, the assessee is not liable to deduct tax. We find that the Ld.CIT(A) has rightly allowed the claim of the assessee by following the decision of this Tribunal in assessee's own case for assessment year 2007-08 to 2013-14. Further, the order of the Tribunal dated 28.08.2018 on the issue of commission paid for receipt of re-insurance premium in assessee's own case was affirmed by the Hon'ble High Court of Madras in TCA No.323 of 2019 dated 14.06.2019. Thus, respectfully following the said judgement, we confirm the order of the CIT(A) on this issue and reject the grounds raised by the Revenue i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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