Life insurance receipts (s. 92(2)(l))

Computation (sub-rule 1). Where a person receives a sum, including bonus, under a life insurance policy:

• First tax year of receipt: income is A − B, where A is the sum or aggregate of sums received under the policy in that year, and B is the aggregate premium paid during the term of the policy up to the date of receipt that has not been claimed as a deduction under any other provision of the Act.
• A later tax year: income is C − D, where C is the sum or aggregate received in that year, and D is the aggregate premium paid up to the date of receipt, other than premium that (a) has been claimed as a deduction under any other provision, or (b) is included in B or D for any earlier year.

Meaning of "sum received" (sub-rule 2). Any amount, by whatever name called, received under the policy that is not excluded from the total income of the tax year under Schedule II [Table: Sl. No. 2], other than a sum received under a unit linked insurance policy, or income referred to in section 92(2)(d).