BHARAT INSURANCE CO LIMITED Vs. INCOME-TAX COMMISSIONER

JUDGEMENT

(1.) This is an appeal from a judgment of the High Court of Judicature at Lahore on a reference made by the Commissioner of Income-tax, Lahore, under Section 66 (2) of the Indian Income-tax Act, 1922, on the question whether the appellant, the Bharat Insurance Company, was liable to be assessed under that Act to income-tax in respect of the profits allotted to participating policy-holders who were entitled under their contract to ninety per cent. of the profits made in the participating branch of the business.

(2.) The Bharat Insurance Company was incorporated under the Indian Companies Act in 1882, for the purpose of making and effecting assurances on lives and carrying on other insurance business.

(3.) Under the provisions of Secs.5 and 6 of the Indian Life Assurance Act, 1912, the company's life assurance business has to be kept entirely separate from its other businesses, if any, and under Section 8(1) it is obliged to have a quinquennial valuation made by an actuary and to cause an abstract of the report of such actuary to be made in the form set forth in the fourth schedule to the Act.