COMMISSIONER OF INCOME-TAX, MADRAS vs PRITHVI INSURANCE CO. LTD.

The Supreme Court ruled that under Section 24(2) of the Indian Income-tax Act, 1922, the life insurance business and general insurance business conducted by the respondent company constituted one composite business. The Court rejected the Revenue's test for determining whether the businesses were distinct, emphasizing that the nature of the businesses, their organization, and management were critical in this determination. The High Court's decision favoring the company was upheld, allowing the loss from the life insurance business to be set off against profits from the general insurance business.