Kotval - (1.) THIS is a consolidated reference pertaining to the assessments of three years upon the assessee. The consolidation is due to the fact that common question of law arise pertaining to the three years.
(2.) THE assessee is the New India Assurance Co. Ltd., Bombay, with its head office at Bombay. It has, however, branches and agencies all over the world. It used to carry on business in both life and general insurance, but the life insurance business was taken away from the assessee-company in consequence of the nationalization of the life insurance business which took effect from the 1st of September, 1956. THEreafter, the life insurance business was vested in the Life Insurance Corporation of India. It appears that in respect of the life business done by the assessee during the years in question before us, certain questions of law had arisen, but, since, under the statute, the liabilities as well as the assets are those of the Life Insurance Corporation, those questions are being agitated by the Life Insurance Corporation in separate proceedings even for the years of account with which we are concerned. THE questions which arise in the present reference, therefore, are solely concerned with the general insurance business of the assessee for those years. We are concerned with the assessment years 1954-55, 1955-56 and 1956-57 corresponding to the account years which are the calendar years 1953, 1954 and 1955. In the assessment proceedings for the three years the assessee had, inter alia, claimed the following exemptions : Firstly, under the provisions of section 15B of the Indian Income-tax Act, the assessee claimed exemption in respect of donations for charitable purposes. Secondly, it claimed that certain dividends received by them from companies in which they had invested moneys were exempt from tax, because those companies were new companies and their dividend income in the hands of the assessee as a shareholder was exempt under the provisions of section 15C(4). Thirdly, the assessee claimed exemption in respect of interest on loans of the Mysore Government which, according to the assessee, were exempted by the Central Government Notification No. 39 dated 5th July, 1954, under section 60 of the Indian Income-tax Act. The Tribunal had given a chart showing the respective figures of exemption claimed by the assessee which we reproduce below which serves to give at a comprehensive glance the amounts of the exemptions claimed in each year of account : JUDGEMENT_761_ITR71_1969Html1.htm
(3.) THE Tribunal has noted at the foot of the chart that the exemption claimed under section 15C(4) was claimed for the first time in the above years of account. Under the third proviso to section 4(1) of the Indian Income-tax Act exemption is granted in respect of an amount of Rs. 4,500 ".....if in any year the amount of income accruing or arising without the taxable territories exceeds the amount brought into the taxable territories in that year......" The exemption granted is by the following words ".......there shall not be included in the assessment of the income of that year so much of suchs excess as does not exceed four thousand five hundred rupees..........." In respect of the business which the assessee-company carried on in foreign countries it claimed this exclusion of income under this proviso to section 4(1) to the extent of Rs. 4,500 in respect of each of the assessment years above.;