03 January 2011
no see section 10(10D) it says all insurance policy is exempted except the key man insurance policy
section 28(vi) specifically provides that any sum received under a Keyman insurance policy including bonus is taxable as business income.
quote from IT Act
section 10(10D) Any sum received under a life insurance policy, including the sum allocated by way of bonus on such policy
other than any sum received -- -under sub-section (3) of section 80DDA or -under a Keyman insurance policy.
Explanation : For the purposes of this clause, "Keyman insurance policy" means a life insurance policy taken by a person on the life of another person who is or was the employee of the first mentioned person or is or was connected in any manner whatsoever with the business of the first mentioned person;
section 28 The following income shall be chargeable to income-tax under the head "Profits and gains of business or profession", - (i) The profits and gains of any business or profession which was carried on by the assessee at any time during the previous year; (i) (ii) . . . (vi) Any sum received under a Keyman insurance policy including the sum allocated by way of bonus on such policy.
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