What is the status of maturity proceed of Jeevandhara,policy of LIC Of India.I have purchased it in year 2001,through single premium mode,now I have received almost 3 times of my investment.Whether it is taxable of taxfree? If taxfree, under which sec.of IT act,I will get the benefit.please guide.
Replied 11 September 2011
the benefit is available u/s 10(10D). If the premium payable is more than 20% of the capital sum assured in any of the year then the proceeds will be taxable. But this is applicable in case of policies issued after 1.4.2003. Thus in ur case the entire proceed is exempted.