M/S. AGRICULTURE INSURANCE COMPANY OF INDIA LTD.,NEW DELHI vs. ACIT, NEW DELHI

Appearances by Akash Singhal, CA for the appellant Ravi Kant Gupta, for the respondent Date of concluding the hearing : May 28, 2018 Date of pronouncing the order : May 30, 2018 O R D E R Per Pramod Kumar, AM:

1. 1. By way of this appeal, the assessee appellant has challenged correctness of learned CIT(A)’s order dated 29th October, 2014 in the matter of assessment under section 143(3) of the Income Tax Act, 1961 for the assessment year 2010-11.

2. Grievances of the assessee, in substance, is that the learned CIT(A) erred in upholding the disallowance of Rs. 37,82,781 (erroneously stated to be 58,11,413 in the grounds of appeal

).

3. When this appeal was called out for hearing learned representatives fairly agreed that the above issue is now squarely covered, in favour of the assessee, by an order dated 9th November, 2017 passed by a co-ordinate bench of the Tribunal in assessee’s own case for the assessment year 2011-12 which in turn follows an earlier decision of the Tribunal i.e. order 1st March, 2016 in assessee’s own case in assessment year 2008-09. The co-ordinate bench has held that since there is a non-obstante clause in Section 44 which provides that notwithstanding anything to the contrary contained in the provisions of the Act relating to computation of income chargeable inter alia under the head profits and gains of any business, the income of the insurance company is to be computed in accordance with rules contained in first schedule to the Income Tax act. It is on this basis that the co-ordinate benches have held that provisions of Section 14A will not come into play in computation of business profits of the assessee company. There is no dispute that these observations also clinch the issue in Assessment year: 2010-11 Page 2 of 2 favour of the assessee in the present case. Learned Departmental Representative has not pointed out any reasons as to why we should make a deviation from the decisions of the co- ordinate benches in assessee’s own case for the assessment year 2011-12 and 2008-09. He has fairly accepted the issue to be covered by earlier decisions of the coordinate benches.

4. In view these discussions and bearing in mind entirety of the case we are of the considered view that, respectfully following the coordinate bench decisions, the impugned disallowance u/s 14A deserves to be deleted. We, accordingly direct the Assessing Officer to delete the disallowance of Rs. 37,82,781.