JUDGMENTBY: LEE HUN HOE CJ (BORNEO)

(delivering the Judgment of the Court): This appeal is concerned with the interpretation of certain provisions, particularly section 60 of the Income Tax Act, 1967. The facts are not in dispute as they are agreed by the parties.

The Taxpayer is an insurance company resident in Singapore and also carries on insurance business in Malaysia through a permanent establishment. It maintains a number of funds. By virtue of section 10 of the Malaysian Insurance Act, 1963 the Taxpayer was required to establish a Malaysian Life Fund in support of its insurance business in Malaysia. It similarly maintains a Singapore Life Fund under the requirements of the Singapore Insurance Act, 1966. The income of the Malaysian Life Fund from investments carried out in and outside Malaysia has been assessed to tax under section 60(4) of the 1967 Act. No dispute arises in regard to the computation of this tax. The Taxpayer also made investments out of the Singapore Life Fund and also out of the other non-assigned funds. These investments earned dividends which are income for years of assessment 1968 to 1974. The Revenue decided that these dividend income were liable to tax

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