St. Aloysius College (Autonomous)
Mangalore
B.Com Semester IV – Degree examination
April/May – 2012
Income tax -II
Time: 3 Hours
Max.Marks:100
Section A
Answer any FIVE of the following
1. Mention the income tax slab rates for women (below 60 years) for the assessment
year 2012-13
2. What do you mean by clubbing of income?
3. Mention the treatment of preliminary expenses as per income Tax act
4. What are capital gains?
5. Mention the conditions to be followed for the levy of depreciation under I.T.Act
6. State the deduction under Sec 80 D.
7. Explain the meaning of the ‘Benami Transaction’
Section –B
Answer any FOUR of the following
8. Compute allowable depreciation from the following
Block of asset
WDV(RS)
Rate (%)
Building
4,50,000
10%
Furniture
40,000
10%
16,00,000
15%
2,00,000
60%
Plant and Machinery
Computers
The assets purchased during the year were:
Building Rs 8,00,000 on
04-06-2011
Furniture
20-08-2011
Rs 40,000 on
Machinery Rs 20,00,000 on 14-12-2011
A computer (cost Rs 50,000) was sold in March for Rs 20,000
9. Ms. Suman sells her residential home in Bajpe on 24-09-2011 for Rs 30,00,000 and
incurs an expenditure of Rs 40,000 in connection with the transfer. Cost of
acquisition of the house in 1976 was Rs 2,00,000 and its FMV as on 1-4-81 was Rs
4,00,000. One room was added to the house on 1-5-94 at a cost of Rs 50,000
She also sells her Jewellery on July 10th, 2011 for Rs 7,05,000(Cost of acquisition
was 15-06-81 for Rs 60,000) selling expenses amounted to Rs 5,000
She invests in a house property worth Rs 5,00,000 and Rs 1,00,000 in NHAI Bonds.
Calculate taxable capital gains assuming that the CII for 1984-82:100, 1994-95:259,
2011-12:785
10. Following is the receipts and payments account of Dr Kalpana for the year ended
31.3.12
Receipts
Rs
Payments
Rs
To Balance
70,000
By Clinic rent
10,000
To Visiting fees
35,000
By Salaries
30,000
To Consultation Fees
45,000
By Taxes
1,500
To sale of Medicines
35,000
By Electricity and water
5,000
To Honorarium from hospital
10,000
By medical books
4,500
To Bank interest
5,000
By Surgical equipments
20,000
To Dividends
4,000
By Car expenses
10,000
By Association fees
2,000
By Audit fees
5,000
By staff welfare expenses
2,000
By Diwali expenses
1,000
By Cost of medicines
35,000
By Donation to Prime Ministers
national Relief Fund
By Balance
8,000
70,000
Total
2,04,000
Total
2,04,000
Additional Information:
a) a patient gifted Rs 5,000 for personalized medical service offered to him and the
same is not included above.
b) The WDV of the motor car on 01-04-11 was Rs 40,000. One –fourth of the car
expenses relates to personal use. Depreciation on car is at 15%
c) WDV of surgical equipments as on 01-04-2011 was Rs 20,000 and the rate of
depreciation is 15%
Compute professional income of Dr.Kalpana
11. Explain exemptions of capital gain as per sections 54, 54 D, 54 EC
12. Mr. D’Souza furnished the following particulars of his investments:
a) Rs 60,000 worth units of UTI (dividend received Rs 8,000)
b) Rs 10,000 in post office savings bank account. The rate of interest is 3% p.a
c). F.D in bank of baroda which earns an interest of Rs 10,000 (gross)
d. F.D in Teachers Co-op bank which earns interest of Rs 8 000 (gross)
e) 8% 15,000 debentures (listed) of Campco Ltd, interest paid by account payee
cheque.
f) Rs 2,500 interest received on National development bonds.
g) 10% Karnataka Development Bonds Rs 12,000
h) Rs 800 received by an account payee cheque as interest on listed debentures of
Bharath Electrical Ltd
i) Rs 4,500 as interest on debentures issued by a local authority.
J) On 15th Dec he inherited Rs 25,000, 12% debentures of MCF ltd from his uncle.
The bank levies 0.5% as commission on the interest realized from outside
investments.
Compute his income from other sources, assuming that interest on the above
securities is payable annually on Dec 31
13. Mr. Sukesh furnishes the following particulars for the Previous year 2011-12
Short term capital gains
5,000
Long term capital gains
10,000
Speculation profits
5,000
Share of profit from partnership firm
5,000
Profit from stationery business
15,000
Income from house property
10,000
Interest from securities
5,000
Following are the brought forward items from assessment year 2011-12
Loss from provision stores (discontinued) 5,000
Unabsorbed depreciation
3000
Speculation loss
15,000
Loss under the head capital gain
8,000
Loss from house property of assessment
Year 2006-07
6000
Compute gross total income for the previous year 2011-12
Section – C
Answer any TWO of the following
14. Given below is the profit and loss account of Ashwin for the year ended 31-032012
Rs
To Salary
15,000
By Gross Profit
To general Expenses
5,000
By Bad Debts recovered
To Advertisement
4,000
By Profit on sale of Shares
To Interest on Capital
2,000
To Interest on bank loan
To Reserve for Bad Debts
To Fire Insurance
To Depreciation
500
2,000
100
4,000
(short term)
1,60,000
5,000
15,000
By Interest on securities
(Gross )
By Dividends(Gross)
By Interest on Post office
6,000
1,000
300
To Reserve for Sales Tax
10,000
Saving bank A/c
To Income Tax
6,000
By Refund of Sales tax
4,000
To Donations
5,000
By Lotteries
1,000
To Car Expenses
1,000
To Wealth Tax
5,000
To general Expenses
8,000
To Loss on sale of land
6,000
(Short term)
To Net Profit
1,18,700
Total
1,92,300
total
1,92,300
Additional information:
a) Salary includes amount withdrawn by him @ Rs 400 per month.
b) Advertisement includes cost of calendars Rs 800
c) Depreciation is found to be in excess by Rs 1,500
d) Actual bad debts amounted to Rs 800
e) ¼ of car expenses relate to personal use.
f) General expenses include Rs 600 paid to a lawyer to defend a criminal suit and Rs
1,000 to a Chartered Accountant for Income tax appeal.
g) Bank Loan was taken to buy securities.
Compute total income of Mr. Ashwin
15. From the following information furnished by Mr. Nayak, (62 years) compute the total
income and the tax liability for Assessment Year 2012-13
Salary
6,58,000
Business loss
50,000
Capital gains – long term
25,000
- shot term(taxable @15%)
Winnings from card games (gross)
Winnings from lottery – Marinara Xylo car
55,000
50,000
6,75,000
Gift of Jewelry received (from on relatives)
Agricultural income in India
2,00,000
80,000
Payments made:
Medical insurance (including parents health
26,000
LIC Premium
15,000
Expenditure on treatment of dependent
Child with severe disability
68,000
Donation to Govt for family planning
25,000
Donation to national Defence Fund
5,000
Interest on education loan of son
12,500
T.D.S on salary
50,000
16. Compute the amount of depreciation allowable for the assessment year 2012-13 from
the following particulars
Assets
WDV (Rs)
Rate
Building
15,40,000
10%
Godowns
2,15,000
10%
Machinery
33,17,600
15%
Motor bus
85,000
30%
Motor car (one)
16,500
15%
Furniture
25,100
10%
Following assets were purchased during the year:
a) machinery (15%) on 31st Dec for Rs 4,50,000
b) Motor truck (30%) on 1st July for Rs 8,00,000
c) Computer purchased on 1st august, but installed on 1st January Rs 60,000
Following assets were sold during the year:
i) Godown on 01-11-11 for Rs 85,000
ii) The car was completely destroyed in an accident. Compensation received rs 10,500
in full settlement.
Section – D
Answer the following
17. From the following data compute taxable capital gain
a) a residential house purchased on 1st Jan 1990 for 2,40,000, sold on 20th March 2012 for
Rs 15,20,000
b) Another residential house property let out was purchased for Rs 60,000 in December
1997 was sold on 10-09-11 for Rs 5,00,000
c) Self cultivated rural agricultural land purchased on 01-01-88 for Rs 1,00,000 was sold
on 01-02-2012 for Rs 6,00,000
d) a block of assets consisting of machinery purchased on 02-11-2011 for Rs 50,000 was
sold on 03-02-2012 for Rs 32,000
e )equity shares of a company purchased for Rs 13,000 on 01-02-2011 was sold and 0101-2012 for Rs 14,000
During the year a residential house for Rs 5,60,000 was purchased.
The CII for 1987-88:150, 1989-90:172, 1996-97:305, 1997-98:331, 1998-99:351, 200102:426, 2002-03:447 and 2011-12:785