DCIT CEN 5 3, MUMBAI, MUMBAI vs. ICICI LOMBARD GENERAL INSURANCE CO. LIMITED, MUMBAI

PER BENCH

These appeals by the Revenue are directed against a consolidated order dated
09.01.2025
passed by the Ld.
Commissioner of Income-tax
(Appeals)
–
54,
Mumbai, for assessment year
2012-13,
2015-16, 2016-17 and 2017-18
respectively. As common issue-in-dispute is involved in all those appeals, therefore, s way of this consolida
2. For the assess application under Ru
Rules, 1963. Accord year is treated as application under Ru and adjudication, if s
3. Brief facts of th that the assessee is (other than life insu the assessee claimed interest income of ₹
Income-tax
Act,
₹21,14,67,970/- und of ₹106,35,11,223/-
Officer, however, was Act, which is a non of entities engaged strictly in accordan consequently, incom the profits and gain
ICICI Lombard G
IT same were heard together and ated order for the sake of conven sment year 2015-16, the ass ule 27 of the Income-tax (App ingly, the appeal of the assess the lead case, together with ule 27, which shall be considere so warranted.
he assessee for assessment ye engaged in the business of ge urance). During the year under d exemption of ₹263,78,71,983/
₹136,28,92,790/- under section 1961
(“the Act”); dividend der section 10(34); and long-ter under section 10(38) of the Act.
s of the view that by virtue of s obstante provision, the comput in insurance business must ce with the First Schedule to e from investments is to be tre ns of business. On that basi
General Insurance Co. Ltd.,
2
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
disposed off by nience.
sessee filed an pellate Tribunal) see for the said the assessee’s ed for admission ear 2015-16 are neral insurance r consideration,
/-, comprising—
n 10(15) of the d income of rm capital gains
. The Assessing ection 44 of the tation of income be carried out o the Act, and eated as part of is, he recorded reasons to believe tha notice under section 3.1 Following the d
Union of India v. Ash the Assessing Office
29.07.2022, after ob and issued notice un the assessee filed its 3.2 During reasses time to time (includ
12.05.2023, and 19. an opportunity of vir the assessee filed a d
3.3 In its submissio interest and sale of profit and loss acc
Schedule, but exemp
Reliance was placed
Court in Life Insuran
(Bom), wherein it wa business is entitled provisions of section argued that once
ICICI Lombard G
IT at income had escaped assessm
148 of the Act on 30.06.2021. directions of the Hon’ble Sup hish Agarwal [2022] 138 taxman er passed an order under sect btaining approval from the spec nder section 148 on the same da return of income on 27.08.2022
sment proceedings, notices we ding on 29.07.2022, 04.01.202
.05.2023). The Assessing Office rtual hearing on 22.05.2023. Pu detailed reply dated 24.05.2023. ons, the assessee contended th investments had already been ount under section 44 read ption under section 10 was sep on the judgment of the Hon’bl nce Corporation of India v. CIT (19
as held that an assessee engag to exemption under section n 44 do not exclude such claim income of ₹263,78,71,983/-
General Insurance Co. Ltd.,
3
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
ment, and issued preme Court in nn.com 64 (SC), tion 148A(d) on cified authority, ate. In response,
2. ere issued from 23, 17.01.2023, er also afforded ursuant thereto, hat income from credited to the with the First arately claimed.
le Bombay High
978) 115 ITR 45
ed in insurance
10(15), as the m. The assessee
(exempt under sections 10(15), 10(3
loss account, there w that it was not routed
3.4 With respect to the Assessing Officer company as to wh indentified for invest
+ = ½ percent of the amounting to Rs.11
added to the taxable read with Rule 5 of th computation of incom
14A inapplicable. Alt submitted that disa
₹2,08,80,098/- on a that exempt income income. A detailed disallowance for the investment cost of Rs.2,08,80,098/-.
3.5 The Assessing O held that in view o assessee could not ta
ICICI Lombard G
IT 34), and 10(38)) stood credited t was no occasion to add it back d through the accounts.
the proposed disallowance und r in its show cause notice aske hy the sum of Rs.19,17,22,2
tment function amounting to R e average of the value of releva
1,71,50,757/-) should not be income. The assessee argued he First Schedule, constitutes a me of insurance companies, re ternatively, and without prejudic allowance, if at all, should b proportionate basis, having re constituted only 28% of the t d working was furnished. A e exempt income cannot exce
Rs.7,45,71,779/- which was Officer rejected the assessee’s of the overriding provision of ake its income outside the purv
General Insurance Co. Ltd.,
4
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
to the profit and k on the ground der section 14A, ed the assessee
236/- (i.e. cost
Rs.7,41,71,779/- ant investments disallowed and that section 44, special code for endering section ce, the assessee be restricted to gard to the fact total investment
Accordingly, the eed 28% of the worked out to contentions. He section 44, the view of taxation by claiming exemptio
Department had alre the ITAT in earlier ye the disallowance und that once the ass proportionate basis, disallowed ₹2,08,80,0
function cost of ₹7,45
income. The relevant for ready reference:
“ICICI Lombard Gene
Assessment Year 20
Details of Investmen

Business & Sates
Communication
Depreciation
Employees' remu
Legal & professio
Printing & Statio
Rents, Rates & T
Repairs & Mainte
Training expense
Travel, conveyan
Total
In response to SCN, to the total income identified for the inv center should be tak
The breakup of the to Parti
ICICI Lombard G
IT ons under section 10. It was also ady preferred appeal against co ears before the Hon’ble Bombay der section 14A, the Assessing O sessee itself had furnished disallowance was warranted.
098/-, being 28% of the identi
5,71,779/-, and added the sam computation of the disallowanc eral Insurance Company Limited
015-16
nt Function Cost
Particulars
Amou s promotion
2,18,02
4,28,88
30,458
uneration & welfare benefits
5,71,67
onal charges
1,33,37
nery
60,740
Taxes
3,52,59
enance
17,04,9
es
1,19.58
ce and vehicle running expenses
11,51,8
7,45,71
assessee has submitted that the proporti e is 28 percent and therefore the per vestment function as allocated to the sepa ken at 28% of Rs 7,45,71,779, i.e. Rs. 2,08
total investment income of the Company is iculars
Amount (in 000’s)
General Insurance Co. Ltd.,
5
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
o noted that the ontrary orders of High Court. On Officer observed working on a Accordingly, he ified investment me to the taxable ce is reproduced
Annexure
4
unt (Rs)
29
81
7,541
7,144
94
979
83
831
1,779
ion of tax-free income rcentage of the cost arate investment cost
8,80,098/- only.
s as below.

Exem
Othe

Hence, the proportio without prejudice to not being applicable disallowance for exe
Rs 2,08,80,098.”
3.6. On further app including the valid disallowance. The a beyond four years, a been issued by the juri ictional officer,
Ltd. v. ACIT (2024) however, rejected this Delhi High Court in taxmann.com 759 (D of this ground furthe
3.7 On merits, th predecessor for earli under sections 10(1
Mumbai, in the asse and the CIT(A) for consistently allowed record that there is year. The relevant fin
ICICI Lombard G
IT mpt Income
2,637,872
er Taxable
6,784,006
on of tax-free income to the total incom our stand of section 14A of the Act and e in the Company’s case, on a without empt income cannot exceed 28 percent of peal, the assessee raised mu dity of reassessment and assessee contended that rea and that notice under section 1
e Faceless Assessing Officer r
, placing reliance on Hexawa
162 taxmann.com 225 (Bom).
s ground, following the judgmen n TKS Builders Pvt. Ltd. v. I
Del). The assessee has not carri r in appeal.
he Ld. CIT(A) followed the ier years and allowed the claim
5), 10(34), and 10(38), noting essee’s own case for A.Ys. 2007
A.Ys. 2011-12, 2013-14, and the same. The findings of th no material difference in facts nding of the Ld. CIT(A) is reprodu
General Insurance Co. Ltd.,
6
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
me is 28 percent and Rule 8D of the Rules prejudice basis, the f Rs 7,45,71,779, i.e., ultiple grounds, merits of the ssessment was 48 should have rather than the are Technologies
The Ld. CIT(A), nt of the Hon’ble
ITO (2024) 167
ied the rejection orders of his m of exemption that the ITAT,
-08 to 2010-11, d 2014-15, had e CIT(A) clearly for the present uced as under:

“6.3 The facts order and th considered.
6.3.1 The fa proceedings t claimed exem respect of inte dividend inco
10(38) of Rs.
u/s. 10(15), 1
the income of Therefore, oth the appellant.
6.3.2 During submitted tha
10(38) is a re issue the ITA allowed the 10(15), 10(34
appellant also allowed the c for A.Y. 201
appellant has regarding clai
During the ap copies of orde as the CIT(A)
From perusal
Mumbai in ITA of appellant h exemption u/
appeal for A.Y in ITA No. 68
2005-06 and the decision under :-
"...2. The solit relates to al section 10(15)
ICICI Lombard G
IT s recorded and finding of the AO in the a he submission made by the appellant acts of the case are that during the a the AO observed that during the year th mption u/s. 10(15) amount of Rs. 136,28,9
erest income, exemption u/s. 10(33/34) in me of Rs. 21,14,67,970/- and LTCG exem
106,35,11,223/-. The AO denied claim of 10(33/34), and 10(38) of the Act on the g f the appellant is assessable u/s. 44 of her provisions of Act are not applicable to .
g the appellate proceedings the app at the denial of exemption u/s. 10(15), 1
ecurring issue in the case of the appella
T Mumbai for A.Y. 2007-08, 2008-09, 20
claim of the appellant regarding exem
4), and exemption u/s. 10(38) of the o submitted that on similar facts the CIT( claim of exemption u/s. 10(15), 10(34),
1-12, 2013-14 and 2014-15. Apart fro s also submitted a detailed reply of on im of exemption u/s. 10(15), 10(34), and ppellate proceedings the appellant has p ers of the ITAT for A.Y. 2007-08 to 2009
in its own case for 2011-12, 2013-14 an l of the orders of the ITAT it is seen tha
A No. 1432/Mum/2016 for A.Y. 2010-11
has decided the identical issue regardin
/s. 10 (15), 10(34), and 10(38). While d
Y. 2010-11 the ITAT relied upon the decis
837 & 6832/Mum/2014 dated 04.10.20
2009-10. For ready reference the releva of the ITAT for A.Y. 2010-11 are repr tary grievance of the Revenue in the pres lowance of assessee's claim of exemp
), 10(34), and 10(38) of the Act.
…………………….
General Insurance Co. Ltd.,
7
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
assessment t has been assessment he assessee
92,790/- in n respect of mption u/s.
f exemption ground that f the IT Act.
the case of pellant has 10(34), and ant. On the 009-10 has mption u/s.
e Act. The (A) has also and 10(38) m that the n the merit
10(38).
rovided the 9-10 as well nd 2014-15. at the ITAT in the case ng claim of deciding the sion of ITAT
016 for A.Y.
ant paras of roduced as sent appeal ption under 8. There bein there being n learned Depa view express referred to a authority by d
9. In the resu
On the basis claim of exem
12, 2013-14 a 6.3.3 There is appellant for 2013-14 and 10(15), 10(34
decision of th
2010-11 and 12, 2013-14
claimed by t respect of int deleted.
Accordingly, g
3.8 Similarly, with the Ld. CIT(A) delete orders of the ITAT including A.Ys. 2005
observing as under:
“7.3.1 During submitted tha case of the a 2005-06 and from that the the merit rega proceedings t the ITATfor A.
ICICI Lombard G
IT ng no difference in fact brought to our no contrary decision brought to our no artmental Representative, respectfully fo sed by the Tribunal in assessee's ow above, we uphold the order of the firs dismissing the ground raised.
lt, Revenue's appeal is dismissed...."
of the order of the ITAT, the CIT(A) also a mption u/s. 10(15), 10(34), and 10(38) for and 2014-15. s no material difference in the facts of the A.Y. 2015-16 and that for A.Y. 2010-11
d 2014-15, as far as the claim of exem
4), and 10(38) is concerned. Therefore fo he ITAT Mumbai in the case of the appella also following the order of the CIT(A) for and 2014-15, the disallowance of the appellant u/s. 10(15), 10(34), and terest income, dividend and LTCG, resp ground no. 2 of the appeal is allowed.”
regard to the disallowance und ed the addition, again following in the assessee’s own case fo
5-06 and 2006-07 and deleted t g the appellate proceedings the app at disallowance u/s. 14A is a recurring i appellant. On the issue the ITAT Mumb
2006-07 has deleted disallowance u/s.
appellant has also submitted a detailed arding disallowance u/s. 14A. During th the appellant has provided the copies o
.Y. 2005-06 and 2006-07. General Insurance Co. Ltd.,
8
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
notice and tice by the ollowing the wn case as st appellate allowed the r A.Y. 2011- case of the 1, 2011-12, mption u/s.
ollowing the ant for A.Y.
r A.Y. 2011- exemption d 10(38) in pectively is der section 14A, g the consistent or earlier years, the disallowance pellant has issue in the bai for A.Y.
14A. Apart reply of on he appellate of orders of From perusal
Mumbai in ITA of appellant disallowance
06 the ITAT
6854/Mum/2
Ltd.
7.3.2 There is appellant for as far as d respectfully fo of the appella
14A made by 5. Before us, the a of the ITAT Rules rais
"The learned under section barred by li
Department a ought to have 5.1 In aid of the assessee has drawn
Bombay High Court
2009) as also the de
ACIT v. SIS Live (175
application under Ru submitted as under:
“2. Reassess limitation
2.1 At the ou application d
Tribunal Rule the Income-ta
ICICI Lombard G
IT l of the orders of the ITAT, it is seen tha
A No. 1990/Mum/2011 for A.Y. 2005-06
t has decided the identical issue u/s. 14A. While deciding the appeal for T relied upon the decision of ITAT i
2010 in the case of ICICI Prudential Ins s no material difference in the facts of the A.Y. 2015-16 and any A.Y. 2005-06 an disallowance u/s. 14A is concerned.
ollowing the decision of the ITAT Mumbai ant for A.Y. 2005-06 and 2006-07, disallo
AO is deleted.”
assessee has filed an application sing the ground as under:
d CIT(A) has failed to appreciate that n 148 of the Act for the captioned assessm imitation which has also been accep and therefore, the proceedings being v e been quashed;"
above contention, learned c our attention to the judgment in Skol Breweries Ltd. v. ACIT ecision of the Delhi Bench of TTJ 643). In support of the iss ule 27 of the ITAT Rules, the a sment proceeding for AY 2015-16 are utset, the Company wishes to submit tha ated 21 April 2025 under Rule 27 of t es, 1963 (Rules) requesting your Honou ax department appeal for AY 2015-16 on General Insurance Co. Ltd.,
9
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
at the ITAT in the case regarding r A.Y. 2005- in ITA No.
surance Co.
case of the nd 2006-07,
Therefore, in the case wance u/s.
n under Rule 27
proceedings ment year are pted by the void-ab-initio counsel for the t of the Hon’ble
T (ITA No. 34 of the Tribunal in sue raised in the assessee further e barred by at it has filed the Appellate ur to dismiss the grounds that the reope barred by li
Supreme Co
Bansal [469
2.2 It is subm section 148 of following the UOI v Ashish
2021 was de and the order
July 2022. Fo even date wa
2.3 The Hon
(supra) observ
Laws (Relaxa
(hereinafter re notices for A amounts belo year limitatio have otherwi period. Howe where the tim
March 2022, extension did point before t
225 of First P
2.4 Thus, in the reassess limitation.
2.5 This vie including deci

Deepak
5177/
5 at Pa

Nehal dated
First Pa

RK Bu
2024 d
234 of 
Manish
Decem
ICICI Lombard G
IT ening of assessment under section 148
imitation based on the decision of ourt in case of Union of India (UO
ITR 46 (SC)].
mitted that the Company had received a of the Act for AY 2015-16 on 30 June 20
directions of Hon'ble Supreme Court in Agrawal (444 ITR 01), the notice received eemed to be notice under section 148A(b r under section 148A(d) of the Act was p ollowing that, a notice under section 148
as also issued.
n'ble Supreme Court in the case of Ra ved that extension granted by the Taxatio ation and Amendment of Certain Provision eferred to as 'TOLA') was applicable to re
AYs 2016-17 and 2017-18 (three-year l ow INR 50 lakh) and AYs 2013-14 and 2
on for amounts above INR 50 lakh), as ise become time-barred during the COV ever, for AYs outside the extension, i.e., A meline to issue reassessment notice ex the Hon'ble Supreme Court observed tha d not apply based on Revenue's accepta the court. (Refer Paragraph 19(e) and 1
Paper Book).
n terms of the aforesaid Supreme Cou sment proceedings for AY 2015-16 ar ew has been affirmed in various oth isions of the coordinate benches of Mumb k Steel and Power Limited [SLP(Civil)
2025 dated 2 April 2025 (SC)] (Refer Pa age 228 of First Paper Book).
Ashit Shah [SLP(Civil) Diary No(s).
4 April 2025 (SC)] (Refer Paragraph 5 at aper Book).
ild Creations Pvt. Ltd. [SLP(Civil) Diary N dated 17 January 2025 (SC)] (Refer Pa f First Paper Book).
h Financial [ITA No. 5055/Mum./202
mber 2024 (Mumbai ITAT)]
General Insurance Co. Ltd.,
10
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
of the Act is the Hon'ble
OI) v Rajeev notice under 021. Further, n the case of d on 30 June
(b) of the Act passed on 29
of the Act of ajeev Bansal on and Other ns) Act, 2020
eassessment limitation for 2014-15 (six- these would
VID exclusion
AY 2015-16, xpired on 31
at the TOLA's ance on this 19(f) at Page urt decision, re barred by er decisions bai ITAT
Appeal No.
aragraph 3 to 57209/2024
Page 231 of No(s). 59625/
age 233 and 24 dated 2


Larsen
April 2

Pushpa dated

Lalit S dated

Ashok dated 3
In the presen section 148 of i.e. after 31 M it is submitted are barred by 6. Per contra, lear admission of the ass that Rule 27 ensh respondent, though nevertheless defend which has been decid instant case, the iss agitated before, nor a exists no finding ad which can be assailed the only issue decid pertained to the com vis the juri ictional
27 has been made o now seek to enlarg altogether new gro adjudicated in the pr
ICICI Lombard G
IT n & Toubro Limited [ITA No. 5745/Mum/2
2025 (Mumbai ITAT)]
ak Realities Pvt. Ltd. [ITA No. 4812/
7 November 2024 (Mumbai ITAT)]
Surajprakash Garg vs. DCIT [ITA 6124
15 April 2025 (Mumbai ITAT)]
Amratlal Shah vs. ITO [ITA No.4286
31 December 2024 (Mumbai ITAT)]
nt case, given that the reassessment n f the Act for AY 2015-16 was issued on 2
March 2022, in light of the above-mentione d that the reassessment proceedings for y limitation, void ab initio and should be rned Departmental Representat sessee’s plea under Rule 27. It hrines a limited principle, n h not having preferred an the order impugned in appeal ded against him by the authori sue of limitation under section adjudicated by, the learned CIT( dverse to the assessee in the i d under Rule 27. According to t ed against the assessee by the mpetence of the Faceless Assessi l Assessing Officer. No applicat on that ground. Therefore, the a ge the scope of Rule 27 by ound which was neither roceedings below.
General Insurance Co. Ltd.,
11
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
2024 dated 7
/Mum./2024
/MUM/2024
6/Mum/2024
notice under 29 July 2022
ed decisions, r AY 2015-16
quashed.”
tive opposed the was contended namely that a appeal, may on any ground ity below. In the 148 was never
A). Hence, there impugned order the Department, e learned CIT(A) ng Officer vis-à- tion under Rule assessee cannot introducing an canvassed nor

Insurance Company and Development A business of general i entities is governed
44 of the Act read w been emphasized tha
44 of the Act overrid of income under the to 43B, and allied pro exemptions conferred learned counsel, se computation of incom the head “profits and under separate head statutory exemptions
Act.
8.4 The learned cou learned CIT(A), in predecessor’s orders that those orders per
B of the First Schedu reintroduction of Rul
Finance Act, 2010, e materially changed. C
ICICI Lombard G
IT duly registered with the Insura
Authority of India (IRDAI) to insurance. The computation of by the special provisions enshr ith Rule 5 of the First Schedule at the non obstante clause cont des only the provisions relating specific heads, namely section 1
ovisions, but does not override t d under section 10 of the Act. A ection 44 merely regulates t me of an insurance company, by d gains of business” what othe ds of income, but it does not s otherwise available under se unsel further submitted that th so far as it proceeds on th for earlier years, is misplaced rtain to years when clause (b) o ule had been omitted from the s le 5(b) by the Finance (No. 2) Ac effective from 1.4.2011, the pos
Consequently, reliance placed b
General Insurance Co. Ltd.,
18
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
ance Regulatory carry on the income of such rined in section e thereto. It has ained in section to computation
199, sections 28
the independent
According to the the manner of y bringing under rwise would fall take away the ection 10 of the he finding of the he basis of his d. It was argued of Rule 5 of Part statute. With the ct, 2009 and the ition in law has by the CIT(A) on decisions pertaining did not form part of under consideration.
the profits arising fr virtue of the omission
528 dated 16.12.198
2011-12 onwards, w within the scope of ta claim exemption und term capital gains on Transaction Tax (STT
8.5 The learned cou position, the assesse investments amounti account, and has 10,63,511/- which q the Act. The balance with the specific prov the assessee has fai computation.
8.6 In support of th decision of the co-or General Insurance Co
ICICI Lombard G
IT to A.Ys. 2007-08 to 2010-11, f the statute, is wholly untenab
It was submitted that prior to t rom sale of investments were n of Rule 5(b), as clarified in CB
88. However, post amendment hile profits on sale of investme axation, the assessee is neverth der section 10(38) of the Act in n sale of securities that have suf
T).
unsel elaborated that in confo e has duly included the entire ing to Rs. 24,32,99,800/- in the claimed exemption only in qualifies for exemption under s e profit has been offered to tax visions of section 44 read with R thfully complied with the statu he above proposition, reliance wa rdinate Bench of this Tribunal orporation of India in ITA No.10
General Insurance Co. Ltd.,
19
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
when Rule 5(b) ble for the year the amendment, not taxable by BDT Circular No.
t, i.e. from A.Y.
nts are brought heless entitled to respect of long- ffered Securities ormity with this profit on sale of e profit and loss respect of Rs.
ection 10(38) of x in accordance
Rule 5(b). Thus, utory scheme of as placed on the l in the case of 080/Mum/2019

for A.Y. 2011-12, w favour of the assesse
8.7 The learned communication issu addressed to the Cha clarified that exemp available to General this clarification has continues to hold the 8.8 Further reliance
Delhi High Court in ITR 658), wherein th held that investment regarded as stock-in investments is not ch allowed the assessee and submitted as un
“3.20 In the c
A.Y. 2005-06
contended th stock in trad allowed exem
Hon'ble Delhi company can
High Court a investments s dated 16.12. ICICI Lombard G
IT wherein identical issues were e.
counsel also placed relia ued by the CBDT dated 1st F airman of the IRDA, wherein it w ption under section 10(38) o
Insurance Companies. It was p s neither been withdrawn nor s e field.
e was placed on the judgment
Oriental Insurance Corporation e Court, after noticing CBDT C ts of a general insurance comp n-trade, and consequently, pr hargeable to tax. The Hon’ble H e’s claim of exemption on sale der:
case of Oriental Insurance Corporation L
6 407 ITR 658 (Delhi), the income-tax de hat investments of the assessee compan de and as such being business incom mption in terms of CBDT Circular No. 528. i High Court held that the investments of not be constituted as stock in trade. The allowed claim of the assessee i.e. 'prof shall not be charged to tax' based on Cir
.1988 by treating the said investmen
General Insurance Co. Ltd.,
20
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
adjudicated in ance on the February, 2006
was categorically of the Act was pointed out that superseded and t of the Hon’ble
Ltd. v. CIT (407
ircular No. 528, pany cannot be rofit on sale of High Court thus of investments
Ltd. (OICL) for epartment had ny constitutes me cannot be However, the f the assessee e Hon'ble Delhi fit on sale of rcular No. 528
nt activity as 'investments'
business/stoc
8.9 Per contra, submitted written ar erred in relying upon force. According to t the entire profit on s of business profits u
Schedule, and the ex the case of insurance
9. We have carefu the material placed the judicial authorit present appeal lies assessee, being a Ge
44 of the Act read w claim exemption (i) u income earned by th interest income on ta u/s 10(38) of the securities where Secu
9.1 The income of section 44 of the Act.
as under:
ICICI Lombard G
IT and not by constituting ck in trade.”
the learned
Departmental rguments contending that the n earlier decisions when Rule he Revenue, once Rule 5(b) wa sale of investments is liable to b under section 44 read with Rul xemption under section 10 is e companies.
ully considered the rival submi on record, the relevant provisio ties cited before us. The con in a narrow compass, namel eneral Insurance Company gove with Rule 5 of the First Schedul under section 10(33/34) of the he assessee (ii) u/s 10(15) of ax free bonds earned by the ass
Act on the income from sale urities Transaction Tax (STT) ha the assessee is taxed under th
. For ready reference said sectio
General Insurance Co. Ltd.,
21
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
g it as Representative learned CIT(A)
5(b) was not in as reintroduced, be taxed as part le 5 of the First not available in issions, perused ons of law, and ntroversy in the ly, whether the erned by section le, is entitled to Act on dividend the Act on the sessee; and (iii) e of long term as been paid.
he provisions of on is reproduced

“Insurance
44. Notwith the provision income charg
“Income from from other s
[43B], the pr including an insurance co computed in First Schedu
9.2 Perusal of sect opens with a non obs anything to the con relating to computati of business or profe income of an insuran with the rules contai in law, as consistent non obstante clause relating to computati does not obliterate th the Act, including th
Thus, the income w head ‘income on se
‘capital gains’ or ‘in assessee, who is enga
ICICI Lombard G
IT business.
hstanding anything to the contrary co ns of this Act relating to the comp rgeable under the head “Interest on s m house property”, “Capital gains” o sources”, or in section 199 or in sect rofits and gains of any business of ny such business carried on by ompany or by a co-operative society n accordance with the rules contain ule.”
tion 44 of the Act above makes i stante clause which reads that n ntrary contained in the provisi ion of income under the head “P fession” or “Income from othe nce company shall be computed ined in the First Schedule. The tly held by the Hon’ble Courts, is intended to override the spe ion of income under the above he operation of other independe hose conferring exemptions un which otherwise may be charge ecurities’ or ‘income from hou come from other sources’ but aged in the business of insuran
General Insurance Co. Ltd.,
22
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
ontained in putation of securities”, or “Income tions 28 to insurance, a mutual y, shall be ned in the it evident that it notwithstanding ions of the Act
Profits and gains r sources,” the d in accordance settled position
, is that such a ecific provisions two heads, but ent provisions of nder section 10. eable under the use property’ or in the case of nce such income is to be charged und subject to Rule 5 of th
9.3 Rule 5 of the F
Profit and Gains of G adjustments. One of the First Schedule of 1989 by the Finance
Schedule stood as un
"any amount meet deprecia shall be allow for in the acc the realizatio profits and ga
Provided tha reasonablene accounts, as on the realiza
9.4 The Central Bo
528 [The Finance Ac provisions relating amendment in Rule 5
Under the exi
Act, the prof computed in Schedule to th gains of any are taken to accounts furn certain adjus is in respect o
ICICI Lombard G
IT der the head ‘profit and gains o he First Schedule.
First Schedule deals with the General Insurance business su the adjustments in clause (b) u f the Income Tax Act, was omitt
Act 1988. Prior to omission, Ru nder:
either written off or reserved in the acc ation of or loss on the realization of inve wed as a deduction, and any sums take counts on account of appreciation of or g n of investments shall be treated as pa ains:
at the Assessing Officer is satisfied ab ess of the amount written off or reserve the case may be, to meet depreciation o ation of investment."
ard of Direct Taxes vide Circul ct, 1988 - Explanatory Notes o to direct taxes] clarified the 5 as under :- isting provisions of Section 44 of the Inc fits and gains of any insurance bus accordance with the rules contained in he Act. Under Rule 5 of this Schedule, Pro business of insurance, other than life in be balance of profits disclosed in the nished to the Controller of Insurance su tments. One of the adjustments provided of any amount either written off or reserv
General Insurance Co. Ltd.,
23
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
of the business’
computation of ubject to certain under Rule 5 of ted w.e.f. 1 April ule 5 (b) of First counts to estments en credit gains on art of the bout the ed in the of or loss lar No.
on the e said come Tax siness is the First ofits and nsurance, e annual ubject to d therein ed in the accounts to m investment w sum be credit on the realisa and gains of Corporation a capital marke
Act has amen provide for ex of investment losses incurre realisation of computing the 9.5 Thus, the intent was to provide exem profits on sale of inv role in the capital ma
Rule 5 of the First S
Act, 2009 w.e.f. 1 Ap that any increase in accounts on accoun investments in accor shall be treated as in business of insuran respect of any amoun to meet diminution accordance with the r
9.6 Rule 5(b) of the Finance Act, 2010 w amended rule 5 of Fir
ICICI Lombard G
IT meet depreciation or loss on the realis which is to be allowed as deduction. Simila ted to the account, due to appreciation of ation of investment is taken as part of th f the business. To enable the General In and its subsidiaries to play a more activ ets for the benefit of policy holders, the nded sub rule (b) of Rule 5 of the First Sch xemption of the profits earned by them on t. As a corollary, it has been provided ed by the General Insurance Corporatio f investment shall not be allowed as ded e profits chargeable to tax."
t of the legislature in the omiss mption to General Insurance Co vestments to enable them to pla arket for the benefit of policy ho
Schedule has been amended by pril 2011, by re-inserting clause respect of any amount taken c t of appreciation of or gains o rdance with the regulations pres ncome and included in the prof nce. Similarly, deduction shall nt either written off or provided in or loss on realization of regulations prescribed by IRDA.
First Schedule has been furth w.e.f. 1 April 2011. For ready rst schedule of Act is reproduce
General Insurance Co. Ltd.,
24
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
sation of arly, any of or gain he profits nsurance ve role in Finance hedule to n the sale that the n on the duction in ion of clause (b) mpanies on the ay a more active olders. However,
Finance (No. 2) e 5(b) to provide credit for in the on realization of scribed by IRDA fits and gains of l be allowed in in the accounts investments in .
her amended by y reference, the d as under:

“Computation of p
5. The profits and insurance shall be t disclosed in the pro provisions of the In under or the provi
Authority Act, 1999
to the following adju
(a) subje or al and divid presc sectio busin
38
[(b)
(i) any adde loss acco
(ii) any debite
39
(c) such may deduc
40 [Provided that a which is added ba
ICICI Lombard G
IT profits and gains of other insuranc d gains of any business of insuran taken to be the 34[profit before tax and ofit and loss account prepared in ac nsurance Act, 1938 (4 of 1938) or the isions of the Insurance Regulatory
(4 of 1999) or the regulations made th ustments:- ect to the other provisions of this rule, llowance 36[including any amount de loss account either by way of a pro end, reserve or any other provis cribed] which is not admissible unde ons 30 to 37[43B] in computing the pro ness shall be added back; gain or loss on realisation of inve ed or deducted, as the case may b is not credited or debited to the ount; provision for diminution in the va ed to the profit and loss account, shal amount carried over to a reserve for be prescribed in this behalf shall ction:
any sum payable by the assessee u ack in accordance with clause (a) of General Insurance Co. Ltd.,
25
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
ce business.
nce other than life d appropriations as ccordance with the e rules made there and Development here under,] subject
, any 35expenditure ebited to the profit ovision for any tax, sion as may be er the provisions of ofits and gains of a estments shall be be, if such gain or e profit and loss alue of investment ll be added back;]
unexpired risks as be allowed as a under section 43B, this rule, shall be allowed as deductio previous year in wh
9.7 From the above nature of tax or divi admissible u/s 32 to and gains of the bu
5(b)(i) prescribe tha is to be added bac already added. Sim then same has to be of the business. Ru diminution in value profit and loss acco gains of the busin allowance of deductio for un-expiry risk.
9.8 On perusal of t
First Schedule it is o of the First Schedule securities were not t
First Schedule w.e.f.
Act, 1988 (Circular amendment, w.e.f. 1
held as Investments
ICICI Lombard G
IT on in computing the income under th ich such sum is actually paid.]”
e it is evident that if any exp idend reserves or any other ite o 38 is to be added back while c usiness of the insurance busin at any gain on realization of t ck to the profit and gains i milarly, any losses if already e deducted while computing p ule 5(b)(ii) provides any provi e for investment which has b ount has to be added back to ness. Further, the Rule 5(c) on if such amounts are carried he aforesaid legislative history observed that the prior to amend e by Finance Act 2010, entire p taxable in view of omission of R
1 April 1989 and Explanatory N
No. 528 dated 16.12.1988).
April 2011, only profits on sa s being long term capital asse
General Insurance Co. Ltd.,
26
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
he said rule in the penditure in the em which is not computing profit ness. The Rule the investment if same is not y not deducted profit and gains ision made for been debited to the profit and prescribes for d offered reserve of Rule 5 of the dment in Rule 5
profits on sale of Rule 5(b) of the Notes to Finance
However, post ale of securities ets which have suffered STT are bein there is no prohibiti from claiming exemp
Act. Recognizing the Rule 5(b) of the First
12, has itself acknow are taxable, but claim
Act in respect of the exemption (viz. prof subjected to STT). Th which shows that for the Company has cla
Act only in respect o paid tax on the balan
Particulars
Profit on sale of invest and Loss Account
Profit on sale of invest
Revenue Account
Total Profit on sale of i
Less: exemption claim
10(38) of the Act
Balance Capital Gain and offered to tax.
The same practice subsequent years a A.Y.
Profit o investm
Profit a Accoun
Accoun
ICICI Lombard G
IT ng claimed as exempt u/s. 10(3
ion in Act which prevent insu ption under various clauses of s above, the Company, after the t Schedule to the Act with effect wledged that such profits on sale med an exemption under sectio e profits on such sale which q fits on the sale of shares wh his would be apparent from th r AY 2015-16 (the present year aimed an exemption under secti of sale of shares which are sub nce as shown in the below table:
Amounts
(Rs. in 000’s)
Reference tment as per Profit
4,12,105
Page no. 364 o book tment as per
20,20,893
Page no. 365 a Paper book investment
24,32,998

med under Section 10,63,511

ns chargeable to tax 13,69,487

e has been consistently followed by also as tabulated in the below tables:
on sale of ment as per and Loss nt and Revenue nt
Amount claimed as Exempt under section 10(38) of the Act
Balance C chargeable offered to General Insurance Co. Ltd.,
27
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
8) of the Act, as urance company section 10 of the e amendment to t from AY 2011- e of investments on 10(38) of the qualify for such hich have been he below tabular r under Appeal), ion 10(38) of the bject to STT and :
of the Paper and 366 of the y the Company for (Rs. in 000’s) apital Gains e to tax and tax.

2016-17
34,92,5
2017-18
43,34,3
2018-19
65,07,7
9.9 In view of abov investment is to be c us, the assessee has profit on sale of inve assessee also credite and dividend income account. Thus as far concerned, the asses
9.10 Now, the issue w for benefit of section between the section 4
the Act restrict the c investment under the otherwise should ha but due to the specia of the entities engag included under the h the income is includ profession, such inc section 10 of the A restrict to including t
ICICI Lombard G
IT 552
7,35,079
27,57.473
300
16,34,578
26,99,722
750
21,07,841
43,99,909
ve Rule 5(b)(i) any gain arising credited to the profit and loss s submitted that assessee has a estment amounting to Rs.24,32
ed the interest income of Rs.1
e of Rs.21,14,67,970/- to the r as compliance of section 44 a see has duly complied.
which arises is whether the ass n 10 or not. In our opinion, the 44 and section 10 of the Act. Th hargeability of the gain arising e head ‘profit and gains of the b ave been taxable under the hea al provision of the section 44 of ged in the insurance business, head ‘profit and gains of the bus ed in the profit and gains of th come is not disentitled from t
Act. The non-obstante clause s the gain on realization of the in General Insurance Co. Ltd.,
28
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
g on sale of the account. Before already credited
,998,000/-. The 136,28,92,790/- profit and loss and Rule 5(b) is essee is entitled re is no conflict he section 44 of from the sale of business’ which ad ‘capital gain’
f the Act in case such income is iness’. But once he business and the provision of section 44 only nvestment under the head profit and under capital gain. T
10(15) in respect dividend income of R
Rs.106,35,11,223/- u
9.11 As far as long t has been claimed by concerned, we find th
“(38) any income 38 ari equity share in a business trust] wh
(a) the transa after the comes into (b) such trans
Chapter :
……………
9.12 Thus section 10
arising from transfe share in a compan included in profit an nature of long term c is entitled for the ben of the conditions pro been adjudicated by case of General Insur for assessment year 2
ICICI Lombard G
IT gains which otherwise is liab
Thus assessee is entitled for be of interest income of Rs.1,
Rs.21,14,67,970/- and long term u/s 10(38) of the Act.
term capital gain of Rs.106,35, the assessee as exempt u/s 10( hat section 10(38) reads as unde ising from the transfer of a long-term cap company or a unit of an equity oriented f here- action of sale of such equity share or unit date on which Chapter VII of the Finan o force 40; and saction is chargeable to securities transa
………………………….”
0(38) does not bar the income w r of long term capital asset b ny. Though income from such nd gains, still if those investm capital asset being equity shares nefit of section 10(38) subject to ovided therein. We find that ide the Co-ordinate Bench of the rance Corporation in ITA No. 10
2011-12 observing as under:
General Insurance Co. Ltd.,
29
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
ble for charging enefit of section 36,28,92,790/-; m capital gain of 11,223/- which (38) of the Act is er :
pital asset, being an fund 39[or a unit of a t is entered into on or nce (No. 2) Act, 2004
action tax under that which otherwise being an equity h investment is ment falls in the s, then assessee o the fulfillment ntical issue has Tribunal in the 080/Mum/2019

“ 3.13. Hence whe of the Act were n assessee had duly subsequent asst amendment in Ru further argued tha to the Act from As drawing specific r book, the asses investments were above treatment investments from beyond doubt tha
2011-12 to Rule way been nullifi by the assessee’
under Section 10
3.14. With regard that the profits on term capital gains business income fo section 44 of the overriding provisio the Act is applicab only for the limite under that head.
have no applicatio which are ab initi words, as income
Section 10(38)] do are not hit by Sect incomes chargeab head of income fro authorities with reg on the CBDT Circ stated that all inve were held for more
10(38) of the Act a For the sake of con on the department)
CIRCULA
ICICI Lombard G
IT erever the specific conditions stipulat not complied with the assessee, we y offered the profits on sale of investm years as tabulated above, purs ule 5(b) of First Schedule to the Act at prior to amendment in Rule 5(b) of F st Year 2011-12 (i.e upto Asst Year reference to the relevant page of the ssee’s claim was that entire profit not subject to tax. Hence it could be of the assessee in respect of prof
Asst Year 2011-12 onwards clearl at the amendment with effect fro
5(b) of the First Schedule to the A ed / rendered ineffective / render
’s claim that it is entitled to th
0(38) of the Act. (Emphasis supplied to yet another observation of the low sale of investments would not be cons s for the assessee and rather the sa or the assessee and consequently the e Act would come into operation n), we find that the ld AR argued that ble to insurance business having ove ed purpose of computation of incom
The ld AR argued that Section 44 o on to incomes enumerated in Section io excluded at source from total inco s enumerated in Section 10 of the not enter into the scope of total incom tion 44 of the Act which specifically a le under different heads. With rega om capital gains to business income gard to profit on sale of investment, th cular No. 6/2016 dated 29.2.2016 w estments sold by the assessee on whic e than 12 months shall be eligible for e and the same shall not be disturbed by nvenience, the said CBDT Circular (wh
) is reproduced hereunder:-
AR NO.6/2016 [F.NO.225/12/2016-ITA
General Insurance Co. Ltd.,
30
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
ted u/s 10(38) find that the ments to tax in suant to the t. The ld AR
First Schedule
2010-11) , by factual paper ts on sale of e seen that the fit on sale of ly establishes om Asst Year
Act, has in no red nugatory he exemption d by us) wer authorities strued as long ame would be e provisions of (which is an t Section 44 of erriding power me chargeable of the Act can
10 of the Act ome. In other
Act [including me at all, they applies only to ard to shift in e by the lower he ld AR relied wherein it was ch shares that exemption u/s y the revenue.
hich is binding
A-II]

SECTION 45, READ WI
CAPITAL GAINS, CHAR
SALE OF SHARES AND INSTRUCT
CIRCULAR NO.6/20
Sub-section (14) of s
"capital asset" to inc not connected with h trade or personal a other securities, the trade/trading asset investment in share capital asset or stock led to a lot of uncerta
2. Over the years, th the shares held as Central Board of Di dated August 31, summarized the said
3. Disputes, howeve the facts of an indiv intention in acquir recognizing that no decide the character same is in the natu major part of shares ones and with a view modification to the Officers in holding w other securities wou into account the follo
(a)
Where the asses shares and secur from transfer of income,
(b) In respect of liste
ICICI Lombard G
IT ITH SECTION 28(i), OF THE INCOME-T
RGEABLE AS - ISSUE OF TAXABILITY
SECURITIES - CAPITAL GAINS OR BUS
TIONS IN ORDER TO REDUCE LITIGAT
016 [F.NO.225/12/2016-ITA-II], DATE section 2 of the Income-tax Act, 1961 ('A clude property of any kind held by an a his business or profession, but does not assets subject to certain exceptions. As e same can be held either as capital ts or both. Determination of the chara s or other securities, whether the same k-in-trade, is essentially a fact-specific de ainty and litigation in the past.
he courts have laid down different param s investments from the shares held as irect Taxes ('CBDT') has also, through In 1989 and Circular No. 4 of 2007 dat d principles for guidance of the field forma er, continue to exist on the application o vidual case since the taxpayers find it ring such shares/securities. In this universal principal in absolute terms c r of income from sale of shares and secur ure of capital gain or business income), s/securities transactions takes place in w to reduce litigation and uncertainty in aforesaid Circulars, further instructs whether the surplus generated from sale uld be treated as Capital Gain or Busines owing—
ssee itself, irrespective of the period o rities, opts to treat them as stock-in-trade such shares/securities would be trea ed shares and securities held for a per
General Insurance Co. Ltd.,
31
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
TAX ACT, 1961 -
OF SURPLUS ON SINESS INCOME -
TION
ED 29-2-2016
Act') defines the term assessee, whether or include any stock-in- regards shares and assets or stock-in- acter of a particular is in the nature of a etermination and has meters to distinguish s stock-in-trade. The Instruction No. 1827, ted June 15, 2007, ations.
of these principles to difficult to prove the background, while can be laid down to rities (i.e. whether the CBDT realizing that respect of the listed the matter, in partial that the Assessing e of listed shares or ss Income, shall take of holding the listed e, the income arising ated as its business riod of more than 12

months immediat to treat the incom shall not be put to taken by the a applicable in sub be allowed to ad years;
(c) In all other cases nature of capital g in view the afores
4. It is, however, c transactions in shar is questionable, suc
Capital Loss or any o
5. It is reiterated th objective of reducing issue of treatment o the relevant provisio involving transfer of 3.14.1. The ld A Hon’ble Delhi High
DCIT reporte din 4
thereon, the Hon'b restrictions impose is not open to a co treat any part of i stretch of imaginat in insurance busin trade. On this cou are dismissed.”
9.13 It is also sign communication date clarified in no uncer would be eligible for e circular/communicat
ICICI Lombard G
IT tely preceding the date of its transfer, if t me arising from the transfer thereof as Ca o dispute by the Assessing Officer. Howe assessee in a particular Assessment bsequent Assessment Years also and the dopt a different/contrary stand in this re s, the nature of transaction (i.e. whethe gain or business income) shall continue to said Circulars issued by the CBDT.
clarified that the above shall not apply res/securities where the genuineness of ch as bogus claims of Long Term Capit other sham transactions.
hat the above principles have been form g litigation and maintaining consistency of income derived from transfer of share ons of the Act shall continue to apply f shares and securities.
AR further drew our attention to th h Court in the case of Oriental Insura
407 ITR 658 (Del) wherein at pages ble High Court had held that in view ed on Insurance Companies by the Ins ompany carrying on general insuranc its investments as “stock-in-trade”.
tion, the investments held by the asse ness, could be construed to have hel unt, also, the observations of the low nificant to note that the CBD d 1st February, 2006 addresse rtain terms that general insura exemption under section 10(38) tion has not been withdrawn til
General Insurance Co. Ltd.,
32
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
the assessee desires apital Gain, the same ever, this stand, once
Year, shall remain e taxpayers shall not egard in subsequent er the same is in the o be decided keeping y in respect of such the transaction itself tal Gain/Short Term mulated with the sole y in approach on the es and securities. All on the transactions he decision of nce Co. Ltd vs
666 and 667
w of the strict surance Act, it ce business to Hence at any essee engaged ld as stock in wer authorities
DT itself, in its ed to the IRDA, ance companies of the Act. This ll date. It is trite law, as reiterated by (237 ITR 889) that C
Act are binding on th contrary to the provis permitted to contend
9.14 The Revenue’s
5(b) by the Finance profits on sale of inve
The reintroduced Ru investments as part o or exclude the oper grants exemption to subject to levy of ST provision and an e construed, unless th legislature, despite
10(38), did not insert companies.
9.15 Viewed thus, th
44 read with Rule income of a genera section 10 continues conditions are fulfil
ICICI Lombard G
IT the Hon’ble Supreme Court in U
CBDT circulars issued under sec he Revenue authorities so long sions of law. Thus, the Revenue to the contrary.
argument that with the reintro
(No. 2) Act, 2009 and the Fina estments are wholly taxable, is ule 5(b) merely brings to tax pr of business profits; it does not o ration of section 10(38) which long-term capital gains on sa
TT. As a matter of settled princ exemption provision must be he statute expressly provides being cognizant of the exemp t any proviso to deny such bene he correct position in law is tha
5 regulates the mode of com al insurance company, the ex s to be available to it, provide led. The assessee, in the pre
General Insurance Co. Ltd.,
33
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
UCO Bank v. CIT ction 119 of the as they are not e cannot now be oduction of Rule ance Act, 2010, not persuasive.
rofits on sale of operate to nullify h independently ale of securities ciple, a charging e harmoniously otherwise. The ption in section efit to insurance at while section putation of the xemption under ed the statutory esent case, has demonstrated compli entire profits from sa claimed exemption represents long-term
9.16 We also find m erred in mechanically years, when Rule 5
discipline requires statutory amendmen and apply the law precedents vitiates th
9.17 In light of the judicial authority and is entitled to claim
Rs.1,36,28,92,790/-
Rs.21,14,67,970/- u
Rs.106,35,11,223/- u
CIT(A) to the contrary on this issue.
9.18 In view of afore assessee of income of ICICI Lombard G
IT iance with such conditions, ha ale of investments to tax in the only in respect of Rs.10,6
capital gains on STT-paid secur merit in the submission that the y following the decisions for ear
5(b) was not on the statute that authorities must have nts in force for the relevant as as it then stood. Reliance o he reasoning.
e foregoing discussion, suppor d CBDT clarification, we hold th exemption) in respect of inte under section 10(15); divide u/s 10(34/35) and long term u/s 10(38) of the Act. The orde y is unsustainable and is accor esaid discussion, the claim of e f Rs.263,78,17,983/- is allowed
General Insurance Co. Ltd.,
34
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
aving offered its e accounts, and 63,511/- which rities.
e learned CIT(A) rlier assessment book. Judicial regard to the ssessment year, on inapplicable rted by binding hat the assessee erest income of end income of capital gain of er of the learned rdingly set aside xemption of the .

Par
Any amount of exp relating to exempt
Expenditure by w the previous yea attributable to an receipt
0.5% x [annual av closing balances o
Total Working
ICICI Lombard G
IT on-obstante clause of section 44
considering the gain arising f he head ‘profit and gains of the y such expenses which are rel nvestment has already been d the business or profession, t
14A of the Act those expenses see is entitled for benefit of se sessee is also liable for section 1
enses incurred in relation to Though, the assessee during ngs has without prejudice filed for cost related to investment i e to the total income, the Ld. A the Income-tax Rules, 1962 an er:
Disallowance:
tisfaction under section 14A and as per is made in casfepf the Assessee:
rticulars

Amount (i xpenditure that is directly t income
2,08,80,098

way of interest during ar which is not directly ny particular income or Nil verage of opening and of investment/income]
11,71,50,45
[0.5% of (23,43,0
13,80,30,555
General Insurance Co. Ltd.,
36
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
4 in our opinion from the sale of e business’ only lated to sale or debited into the then in view of are liable to be ection 10 of the 14A of the Act in earning of the the course of d a computation in proportion to Assessing Officer d computed the Rule 8D, the in Rs.)
57
00,91, 474)]

Suo motu Disallow assessee in comp relating to exempt
Final Disallowanc
The disallowance u/s. 14A
Section 10 is held to be out
10.4 As no suo-moto return of income and invoking section 14A under Rule 8D of the finding of the Ld. CIT grounds of appeal re allowed.
11. As facts and c assessment years 20
the facts and circ accordingly, following relevant grounds rais
2017-18 are decided
10. In the result, whereas application u
Order pronoun (RAJ KUMAR C
JUDICIAL M
ICICI Lombard G
IT wance made by utation for Expenditure t income
Nil ce u/s. 14A rw Rule 8D
13,80,30,555
A is an Alternative Assessment, would come in tside se. 44 of the Act.
disallowance was made by the d therefore, the Assessing Office
A r.w.r. 8D. Accordingly, the dis e Rule by the Assessing Officer
T(A) on this issue is accordingl elated to disallowance u/s 14A circumstances in other assess
012-13, 2016-17 and 2017-18
cumstances in assessment g our finding in assessment ye sed in assessment year 2012-1
mutatis mutandis.
appeals of the Revenue are under Rule 27 of the assessee is ced in the open Court on 26/0
-
S
CHAUHAN)
(OM PRAK
MEMBER
ACCOUNTA
General Insurance Co. Ltd.,
37
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
nto effect only when assessee in the er is justified in allowance made r is upheld. The ly reversed. The are accordingly ment years i.e.
are identical to year 2015-16, ar 2015-16, the 3, 2016-17 and allowed partly s dismissed.
09/2025. KASH KANT)
ANT MEMBER

Mumbai;
Dated: 26/09/2025
Rahul Sharma, Sr. P.S.

Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.

////

ICICI Lombard G
IT ded to :

BY ORDER

(Assistant Re

ITAT, Mu

General Insurance Co. Ltd.,
38
TA Nos. 1679 1681, 1682 &
1680/MUM/2025
R, gistrar) umbai