IN THE INCOME TAX APPELLATE TRIBUNAL “I” BENCH, MUMBAI BEFORE SHRI AMIT SHUKLA, JM &

MS PADMAVATHY S, AM I.T.A. No. 2594/Mum/2018 (Assessment Year: 2014-15)

The New India Assurance ACIT -3(2)(2), Company Ltd. , Aayakar Bhavan, M.K. Road, Central Accounts, Taxation Mumbai-400020.

Vs.

Department,, 87, M. G. Road, Fort, Mumbai-400001. PAN: AAACN4165C Appellant) : Respondent I.T.A. No. 3150/Mum/2018 (Assessment Year: 2014-15)

ACIT -3(2)(2), The New India Assurance Room No. 608, Aayakar Bhavan, Company Ltd. , M.K. Road, Mumbai-400020. Central Accounts, Taxation Vs.

Department,, 87, M. G. Road, Fort, Mumbai-400001. PAN: AAACN4165C Appellant) : Respondent Appellant /Assessee by : Shri Farooq Irani, AR Revenue / Respondent by : Shri Vivek Perampurna, CIT-DR Date of Hearing : 13.02.2025 Date of Pronouncement : 11.03.2025 O R D E R Per Padmavathy S, AM:

These cross appeals by the assessee and the revenue are against the order of Commissioner of Income Tax (Appeals)- 9, Mumbai [In short ‘the CIT(A)’] dated 15.03.2018 for Assessment Year (AY) 2014-15. The Assessee and the Revenue raised the following grounds of appeal:

Assessee’s Appeal “The under mentioned Grounds of Appeal are without prejudice to one another:

1. The CIT(Appeals) ought to have held that Foreign Dividend Income was assessable in the Appellant's hands only net of the foreign taxes of Rs.22,20,699/- thereon.

2.(i)The CIT(Appeals) erred in confirming the action of the AO, of disallowing the payments of Rs.183,11,32,413/- by the Appellant to Auto dealers.

(ii) The CIT(Appeals) ought to have reversed the action of the AO, of disallowing the payments of Rs.183,11,32,413/- by the Appellant to Auto Dealers and ought to have held that the entire sum of Rs.183,11,32,413/-was allowable to the Appellant.”

Revenue’s Appeal

1. Whether on the facts and circumstances of the case and in law, the Ld.CIT (A) was justified in holding that the profit on sale of investments has to be taxed as Income from Capital Gain and not Income from Business.

2. Whether on the facts and circumstances of the case and in law, the Ld.CIT (A) erred in holding that income of Rs.954,56,33,686/- is exempt u/s 10(38) of the I.T. Act, 1961.

3. Whether on the facts and circumstances of the case and in law, the Ld.CIT (A) has erred in not appreciating the fact that the amount of disallowance u/s 14A of the I.T. Act, 1961 has to be computed as per Rule 8D of I.T. Rules, 1962 when the computation of the assessee was not found to be correct and as held in the order of the Hon'ble High Court in the case of M/s. Godrej &

Boyce Manufacturing Co. Ltd.

4. Whether on the facts and circumstances of the case and in law, the Ld.CIT (A) has erred in holding that the premium paid by the assessee on purchase of Government Securities, on Amortisation, was allowable as Revenue Expenditure without appreciating the fact that there is no provision for amortization of such premium in the I.T. Act, 1961.

5. Whether on the facts and circumstances of the case and in law, the Ld.CIT (A) has erred in holding that the premium paid by the assessee on purchase of Government Securities, on Amortisation, was allowable as Revenue Expenditure without appreciating the fact that such premium paid is capital in nature and hence not allowable u/s 37 of I.T. Act, 1961.

6. Whether on the facts and circumstances of the case and in law, the Ld.CIT (A) has erred in holding that the provisions of Section 115JB of the I.T. Act, 1961 are not applicable in the case of the assessee.

7. "The appellant prays that the order of CIT(A) on the above ground be set aside and that of the Assessing Officer be restored."

2. The Assessee is a public sector undertaking operating under the control of The Ministry of Finance, Government of India. The assessee is engaged in the business of General Insurance within and outside India. The assessee filed the return of income for AY 2014-15 on 29.11.2014 declaring total income of Rs. Nil under the normal provisions of the Act and Book Profit of Rs.937