CALCUTTA HOSPITAL AND NURSING HOME BENEFITS ASSOCIATION LTD Vs. COMMISSIONER OF INCOME TAX
LAWS(CAL)-1961-9-2
HIGH COURT OF CALCUTTA
Decided on September 26,1961

Appellant
VERSUS
COMMISSIONER OF INCOME TAX Respondents

JUDGEMENT

P.B.MUKHARJI J. - (1.) HAS Parliament succeeded in bringing the "surplus" of a mutual insurance business not dealing with life, within the impact of Income-tax, is the main question in this Income-tax reference.
(2.) THIS reference is made by the Tribunal under s. 66(1) of the Indian IT Act at the instance of the assessee, the Calcutta Hospital and Nursing Home Benefits Association Ltd., for the determination by this Court of the following questions of law : "1. Whether the profit arising to the assessee company from miscellaneous insurance transactions of a mutual character was assessable under the Indian IT Act ? 2. If the answer to question No. 1 is in the affirmative, whether, on the facts and in the circumstances of the case, the balance of the profits as disclosed in the assessee company's profit and loss account after deducting the various reserves should be taxable profits within the meaning of s. 2(6C) r/w r. 6 of the Schedule of the Indian IT Act ?" There were five applications which have been consolidated into one statement of case covering the different assessment years. The Tribunal disposed of these applications by the consolidated order of the Tribunal dt. 4th Sept., 1956.
(3.) THE essential facts may be briefly stated at the outset : The assessee is a mutual concern carrying on miscellaneous insurance business. It has no share capital and no shareholder. To quote some of the major clauses like 3(1) and (iv) of the memorandum of association the objects of the society, inter alia, are : (1) To provide, or help towards providing, anywhere in the world for the expense of accommodation and treatment in hospitals and nursing homes and of private nursing for members and their dependent's "by means of insurance on the mutual principle". (2) "To organise insurance on the mutual principle" under regulations to be framed for the purpose with the object of providing such hospital, medical, surgical, nursing and allied services and of relieving members and their dependents in whole or in part from payment of hospital and other charges. ;


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