The ITAT adjudicated multiple tax issues for an insurance ...

Insurance Company Wins Major Tax Battle: Multiple Deductions Upheld, Exemptions Confirmed, Gross Income Principles Clarified

April 17, 2025

Case Laws     Income Tax     AT

The ITAT adjudicated multiple tax issues for an insurance company. Key holdings include: (1) dividend income must be offered on gross basis; (2) payments to auto dealers were legitimate and cannot be disallowed based on Central Excise findings; (3) exemption under section 10(38) for long-term capital gains is available to insurance companies; (4) section 14A is inapplicable to insurance companies governed by section 44; (5) amortization of securities premium is permissible; and (6) disallowances under section 14A cannot be added to book profits under section 115JB. Predominantly decided in favor of the assessee, with the tribunal directing deletion of various disallowances and upholding the insurance company's tax treatment.

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