Hiren Rameshbhai Patel Vs DCIT (ITAT Ahmedabad)
ITAT Ahmedabad held that amount received as refund for surrender of Life Insurance Policy cannot be treated as unexplained money under section 68 of the Income Tax Act. Accordingly, appeal allowed and addition deleted.
Facts- Assessee has preferred the present appeal mainly contesting that CIT(A) has erred in upholding the impugned addition u/s 68 amounting Rs. 4,97,543/- received as refund for surrender of Life Insurance Policy offered as exempt income by the appellant. Appellant contested that CIT(A) has erred in upholding addition of Rs. 4,97,543/-without allowing of insurance premium paid by the appellant towards the Life Insurance Policy.
Conclusion- Held that the amount of Rs. 4,97,543/- was received by the assessee as refund for surrender of Life Insurance Policy by ICICI Prudential Life Insurance Company towards Life Insurance Cover. Since the assessee is not in possession of that policy due to surrender, the said document was not submitted to the Assessing Officer, but the relevant details of amount received from surrendering the policy as well as the earlier payment made to Insurance Company was submitted to both the Revenue authorities as well as CIT(A). Hence, the assessee explained the amount of Rs. 4,97,543/-which is an insurance refund and claimed as exempt income. Thus, this cannot be treated as unexplained money under Section 68 of the Act.
