PART TIME SEM- III
University Paper 2009
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Attempt any FIVE questions
2) Use of Bare Income Tax Act is allowed .
3) Figures to the right of the question indicates marks.
4) Make suitable assumptions wherever required.
5) All Questions carry equal marks.
Q.No.1. From the following Profit & Loss Account of Mr. Sameer, compute his total
taxable Income for the assessment year 2009-10
(20)
Profit & Loss Account for the year ended 31st March 2009
Particulars
Rs.
Particulars
To Opening Stock
3,10,000
By Sales
To Purchase
9,25,000
By Closing Stock
To Salaries
70,000
By Income Tax
To Bad Debts
28,000
Refund
To Advetisement
15,000
By Dividend
To Fire Insurance Premium
5,000
From Co-Op Bank
To Conveyance
8,000
By Gift from
To Interest on Proprietor’s
Mother
Capital
45,000
By Lottery Prize
To General Expenses
65,000
To Wealth tax
5,000
To Sales Tax penalty
4,000
To Depreciation
30,000
To Net Profit
2,10,000
Total
Rs
17,20,000
Total
Rs
Rs.
12,50,000
3,15,000
15,000
30,000
10,000
1,00,000
17,20,000
Additional Information:1) Depreciation allowable as per Income Tax Rules is Rs.35,000.
2) General Expenses include:
a) Purchase of lottery tickets Rs.1,000
b) Income Tax paid Rs.10,000
c) Sameer’s son’s school fees Rs.10,000
3)Purchases include Rs.1,00,000 paid for cash purchases exceeding the limit prescribed
under section 40A (3) of Income Tax Act 1961.
4) Mr.Sameer is physically handicapped with 75% disability.
5) Mr.Sameer has contributed Rs.20,000 towards Life Insurance premium for self, which
is included in salaries.
Q.2. Mr. Vipul has purchased a residential house on 1st Aug,1981 for Rs.3,00,000. he
incurred Rs.1,00,000 towards cost of improvement during the previous year 1983-84. he
sold the house on 1st Feb,2009 for Rs.25,00,000/
He paid Brokerage of Rs.75,000
Cost Inflation Index for the financial year 1981-82 is 100; for financial 1983-84 is 116
and financial year 2008-09 is 582.
Compute the Income from Capital Gains of Mr.Vipul for assessment year 2009-10
20 Marks
Q.3. Write short notes on any Three.
a) Depreciation
b) Deduction from income from salary
c) Indexation
d) Perquisites
e) Deductions under income from Other Sources.
Q.4. Mr.Kashiram owns to houses. He furnishes the following information for the
previous year ended 31st March 2009. you are required to compute his Net Taxable
Income for the previous year ended 31st March,2009 form the following data:
Particulars
House at Mumbai
Rs.29,000
Rs. 6,500
House at
Sangli
Let Out
9500pm
Rs.68,000
Rs.9,000
1. Nature of occupancy
2.Actual rent
3. Municipal Ratable value
4.Municipal taxes paid
5.Fire Insurance Premium paid on 1.1.2009 for
the year ending 31.12.2009
6.Ground rent payable
7. Cost of water proofing
8. Interest paid on loan for construction of
property
9.Repayment of principal amount of loan
Self Occupancy
Rs.7,200
Rs.220
Rs.2,000
Rs.8,000
Rs.400
Rs.5000
Rs.12,500
Rs.10,000
Rs.16,000
Rs.15,000
Mr. Kashiram was required to pay Rs.700 p.m. to his sister out of the income earned from
Sangli House as per his Father’s will.
Q.5.Explain any Three of the following
a) Assessment
b) Person
c) Company
d) Block of asset
e) Assessee
(20)
Q.6. a) What is the scope of income for Resident and Ordinary Resident and Non
resident?
(10)
b) How is the residential status of an Individual as “Resident and Ordinary
Resident”determined under section 6(1), 6(6) (a) of the Income Tax Act,1961?
(10)
Q.7.
a) Explain briefly any 5 items of expenses which are allowed as deduction while
computing Income from Business or Profession.
(10)
(b) Enumerate and explain briefly the exemptions available under section 10 with
reference to any 5 items.
(10)
___________________________
PART TIME SEM- III
University Paper 2008
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Attempt any FIVE questions
2) Use of Bare Income Tax Act is allowed .
3) Figures to the right of the question indicates marks.
4) Make suitable assumptions wherever required.
1. Prof. Gopal is a lecturer in a college at Mumbai. The details of his salary and other
expenses for the previous year 2007-08 are as follows:
(20 Marks)
Rs.
a) Basic Salary
40,000
b) Dearness Allowance (forming part of salary)
7,000
c) City compensatory allowance
3,000
d) Education allowance for his son
4,000
e) House Rent Allowance
6,200
i) Rent Paid
7,100
ii) Exempt u/s 10(13A)
2,400
f) Remuneration from Mumbai University for acting
as an examiner and remuneration from Delhi
University as paper setter
3,500
g) Allowance for looking after the evening shift of
the College
500 p.m.
He incurred an expenditure of Rs.1,000 for attending a seminar at Delhi and the
expenditure was reimbursed by the college. During the year he spent Rs.3,000 for
purchase of books. Professional Tax Paid by him is Rs.1,600
You are required to compute the taxable income from salary of Prof. Gopal for
the Assessment year 2008-2009.
2. Define and explain any Three of the following terms:
a) Assessee
b) Assessment Year and previous year
c) Income
d) Annual value
e) Block of Assets
20 Marks
3. Mr. Oswal owns a building consisting of three identical units whose construction was
completed on (31st March 2007). The building was occupied from 1st April 2007
onwards. The particulars pertaining to the three units for the year ended 31st March 2008
are given below:
20 Marks
Particulars
Unit 1 (Rs)
Unit 2 (Rs.)
Unit 3 (Rs.)
Fair Rent
Rent Received
Municipal Taxes
-----paid
-----due but not yet paid
Land Revenue Due but Outstanding
Ground Rent Due but not paid
60,000
-
60,000
72,000
60,000
-
3,000
3,000
1,200
2,400
5,000
5,000
1,200
2,400
3,000
3,000
1,200
2,400
Nature of occupation : unit 1 self occupied for residence. Unit 2 Let out for residence.
Unit 3 used for own business.
On 1st April,2005 he had borrowed a sum of Rs.5,00,000 bearing interest rate of 12%
P.A. for construction of this building. The total cost of construction of the building is
Rs.12,00,000. The interest on borrowed sum on the construction of the Building is
Rs.72,000. Computer the income from house property of Mr.Oswal for the Assessment
year 2008-09
4. Define the concept of residential status and its impact on the incidence of tax in the
case of individuals with suitable examples.
20 Marks
5. Enumerate and discuss any five items of expenses which are expressly allowed as
deduction in the computation of income from business and profession
20 Marks
6. Write short notes on (ANY THREE)
a) Amortization of preliminary expenses
b) Depreciation allowance
c) Provided Fund under in Income Tax
d) Deductions from income from house property
e) Research and development expenditure.
20 Marks
7. Mr. Bharadwaj, proprietor of Bharadwaj and sons submits the following information
for the previous year ended 31st March,2008.
20 Marks
Profit and Loss Account for the year ended 31st March 2008.
Particulars
Amount Particulars
Rs.
Salaries and Wages
1,22,000 Gross Profit
Printing and stationary
24,400
Agricultural Income
Motor car expenses
29,600
Interest on PPF account
Rent
24,000
Gift from father
Entertainment expenses
17,000
Winning from lotteries
Advertisement Expenses
47,000
NSC interest
Depreciation
32,000
Drawings
50,000
Advance income tax
15,000
Embezzlement by an employee 5,000
Donation
28,000
Self Welfare expenses
66,000
Net Profit
2,80,000
Total
7,40,000
Amount
Rs.
7,10,000
8,000
6,000
4,000
10,000
2,000
7,40,000
Additional information:
a) Allowable depreciation u/s 32 of Income Tax: Rs.35,000
b) Half the rent is attributable towards the residence of the proprietor
c) Staff welfare expenses include Rs.16,000 incurred fir his own medical treatment
d) Advertisement expenses include Rs.15,000 towards introduction of a new product.
e) Printing and stationary expenses include Rs.4,400 paid for printing of marriage card of
his son
f) He spent Rs.200 for purchase of lottery tickets.
g) A deduction of Rs.21,000 is available u/s 80(G) in respect of donation expenditure
incurred.
You are required to compute the taxable income of Mr.Bharadwaj for the Assessment
Year 2008-2009
*****************************************
PART TIME SEM- III
University Paper 2007
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Attempt any FIVE questions
2) Use of Bare Income Tax Act is allowed .
3) Figures to the right of the question indicates marks.
4) Make suitable assumptions wherever required.
1.
Mr. Ram Dayal is working as a purchase manager with a private sector company
in Mumbai. He has provided the following particulars of his income for the financial year
2006-07
Basic Salary ……………………………………………………..Rs.40,000 per month
Dearness Allowance…………………………………………………20,000 per month
House rent Allowance……………………………………………….8,000 per month
Medical Allowance…………………………………………………10,000 per month
Travelling Allowance……………………………………………….15,000 per month
Special Duties Allowance…………………………………………...25,000 per month
Profession Tax………………………………………………………….200 Per month
Mr. Dayal Lives in a rented house, for which he pays an annual rent of Rs.24,000 As per
the employment contract the dearness allowance is taken into account for giving
retirement benefits.
Mr. Dayal made a contribution of Rs.7500 to a recognized provident employer also made
a matching contribution to the fund. The employer paid a premium of Rs.6000 on the life
policy if Mr.Dayal
You are required to compute the taxable income from salary of Mr Ram Dayal.
20 Marks
2. a) What is the scope of income of the following individual assesses:
i) Resident but not ordinarily resident
ii) Non Resident
5 Marks
5 Marks
b) What incomes are taxable under the head income from other sources
10 Marks
3. Define and explain any three of the following terms:
a) Person
b) Assessee
c) Perquisite
d) Self Occupied Property
e) Capital Asset.
20 Marks
4. a) What do you understand by “Transfer of capital Asset”?[selection 2(14)]Enumerate
any three transactions that are not regarded as transfer of capital asset’? (Section 47)
10 Marks
b) What deductions are admissible to individuals in respect of payment towards donation
to charities? What are the conditions for availing such deductions? (Section 80G)
10Marks
5. Mrs. Sunita shanker is a management consultant. Mrs. Shanker is also a visiting faculty
at a few management colleges. She provides you with the following details of her receipts
and payment s pertaining to her profession for the financial year 2006-2007
Receipts
Amount
Payments
Amount
Bank Balance(1.4.06) 1,40,000
Purchase of a computers…………….60,000
Fees from clients……12,00,000
Motor car expenses………………….90,000
Honorarium from clients 60,000
Purchase of Books………………….. 50,000
Cash gift from clients…..50,000
Salary to staff……………………….100,000
………………………………………Office Repairs……………………….50,000
………………………………………Income Tax……………………… 1,50,000
………………………………………Subscription to journals ……………25,000
………………………………………Annual membership fees
………………………………………of a professional body……………….5,000
……………………………………....Telephone charges…………………30,000
……………………………………….Entertainment expenses………… 24,000
……………………………………….Household expenses……………… 6,000
……………………………………….office expenses……………………60,000
………………………………………Bank Balance(31.3.2007)……… 8,50,000
Total Rs……..
15,00,000
Total Rs….
15,00,000
Additional Information:
1) Mrs. Sunit Shanker had maintains her books of account on cash basis.
2) 50% of the motor expenses pertain to Professional work
3) Depreciation on motor car is charged at the rate of 20 per cent per annum.
You are required to computer the taxable income under the head profits and gains of
business and professional of Mrs. Sunita Shanker.
20 Marks
6. Mr. Joseph owns two houses in Mumbai. He gives you the following details for the
financial year 2006-07
Particulars
House# 1
House#2
Fair Rental Value…………………………………... 25,000……………….22,000
Rent Received ………………………………………28,000……………….25,000
Municipal Valuation………………………………...26,000……………….25,000
Municipal Tax Paid………………………………......3,000………………...4,000
Repairs……………………………………………….1,500…………………2,500
Fire Insurance Premium……………………………...2,000…………………3,000
Land Revenue………………………………………..2,500…………………4,000
Ground Rent…………………………………………1,600………………….6,000
Nature of Occupation………………………………...Let Out………………Let Out
Residence……………Business
Additional Information
Mr. Joseph had obtained a loan by mortgaging Huse#1. the loan was used to finance the
construction of House#2. during the year Rs.4000was paid as interest.
You are required to compute Joseph’s taxable income under the head income
from house property.
20 Marks
7.Write short Notes. On any three of the following
a) Agricultural Income
b) Amortisation of preliminary expenses
c) Set off and carry forward of losses
d) Income
e) Methods of accounting
______________________________
20 Marks
PART TIME SEM- III
University Paper 2006
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Question No1 and Q. No. 2 are compulsory and carry20 marks each.
2) Attempt any FOUR from the remaining question. These carry 15 marks each.
3) Make suitable assumptions wherever required.
1. Mr. Sunil is a proprietor of a business. The following was the Profit and Loss Account
of his business for the year ended 31st March,2006:20 Marks
Rs.
Rs.
To Office Salaries
1,14,000
By Income
4,73,161
To Proprietor’s Salary
16,000
By Rent
1,44,000
To General Expenses
7,500
By Bad Debt Recovered
23,000
To Bad Debts
1,500
(disallowed in earlier year)
To Advertisement
4,200
Interest(Net)
16,900
To Fire Insurance Premium
1,800
(TDS-Rs.1,900)
To Depreciation on Car
13,900
To Motor Car Expenses
24,300
To LIC Premium Paid
21,200
To Foreign Travel Expenses
45,600
To Donations
21,500
To Interest on Proprietor’s Capital
18,900
To Reserve for Future Losses
55,000
To Income Tax Paid
22,400
To Net Profit
2,89,331
_________
____________
Total Rs.
6,57,151
Total Rs.
6,57,151
Further information is given below:a) General expenses include Rs.1,200 paid as a help to a poor student.
b) Out of the donations a sum of Rs.11,000 is eligible for deduction u/s80G@
50%
c) One third of Motor Car Expenses is for personal use of the car.
d) The depreciation as per I.T. Act is Rs.31,200
Compute the taxable income of Mr. Sunil for the year ended 31-3-2006[A.Y.2006-07]
2. From the following particulars compute the taxable income of Ms. Medha Sawant for
the A.Y. 2006-07:20 Marks
a) Her net salary is @ Rs.25,600/- per month. The following monthly deductions were
made from salary:
- Professional Tax @ Rs.220
- Provident Fund @ Rs.2,500
- TDS @ Rs.1,500
b) She received part time salary @ Rs.5,000 per month from November,2005
c) Gift received from parents Rs.66,000 and loan taken from brother Rs.1,00,000
d) Mediclaim Premium paid is Rs.11,230/- in cash.
e) Purchased NSC of Rs.40,000 while interest received on bank of deposit is Rs.12,228.
dividend received during the year amounted to Rs.23,560.
f) Leave salary received Rs.30,000/g) H.R.A. is @ 20% months of salary, was received.
h) Bonus- 2 months of salary, was received.
i) Her income from horse race betting’s amounted Rs.5,000/-
3. a) Define “Perquisites” State any five items of perquisite which are not taxable.
8 Marks
b) How is the residential status of an individual as “Resident and Ordinarily Resident”
determined u/s6(1),
7 Marks
4. a) Mr. Mukund is the owner of the following properties for which the details are as
follows for the financial year 2005-06:House 1
House II
(Self Occupied)
(Let Out)
Municipal Reteable value (Rs)
63,000
2,27,000
Municipal Tax thereon
20%
15%
Rent Received (Rs)
Nil
2,10,000
Repairs (Rs)
30,000
45,000
Interest on borrowings for construction (Rs) 16,000
48,000
HDFC loan repaid (Rs)
36,000
24,000
From the above, compute his income from house property.
8 Marks
b) Vijay Purchases 250 equity shares of ABC Ltd. On 1-6-1987 for Rs.270 per share and
incurs expenditures on brokerage of Rs.500. on July1,1996, he gets bonus of 200 shares.
On September 1,1997 he gets on 300 rights shares for Rs.140 per share . On February
28,2006. he sells all the 750 shares for Rs.400 per share and incurs an expenditure of
Rs.1,500 on brokerage
7 Marks
Compute his taxable income for A.Y.2006-07. he does not have any other source
of income .
The Cost inflation index fot the year 1987-88 is 150; for the F.Y.1996-97 is 199;
fir F.Y.1997-98 is 331 and for the F.Y.2005-06 is 497.
5. (a) Enumerate any ten items which are items which are exempt from income tax u/s.10
7 Marks
(b) Explain in brief any three deductions under section 80 of the I.T. Act,1961
8 Marks
6. (a) Enumerate any six items which are not deductible as business expenditure.8 Marks
(b) All “receipts are not income” Explain with illustrations.
7. (a) Explain the “Scope of Income” under Income tax Act,1961
7 Marks
8 Marks
(b) Explain briefly the provisions of “Set off and carry forward losses” under the
income tax act in respect of “Business Income”
7 Marks
8. Write short notes on (ANY THREE):a) Agricultural Income
b) “Person” under income tax Act
c) Deductions from income from Salary
d) Depreciation under I.T. Act,1961
e) Non- Resident.
____________________________
15 Marks
PART TIME SEM- III
University Paper 2005
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Question No1 and Q. No. 2 are compulsory and carry20 marks each.
2) Attempt any FOUR from the remaining question. These carry 15 marks each.
3) Make suitable assumptions wherever required.
1. Mr. Dheeraj was the General Manager of a company XYZ Ltd. Since January,1978.He
was entitled to a basic salary of Rs.15,000 p.m. He also received Rs.1500 p.m. as
clearness allowance, rs.200 p.m. as city compensatory allowance.Rs.1000 p.m. as
entertainment allowance, and Rs.400 p.m. as house rent allowance. He resides with his
parents at their house. He contributed Rs.1000 p.m. to the recognized provident fund of
the company. The company also contributed an equal amount. He retired voluntarily on
31-12-2004, He received the following amounts on retirement.
a) Gratuity Rs.80,000 (he is not covered under the payment of Gratuity Act)
b) Compensation for voluntary retirement under a scheme approved by the Central
Government Rs.1,80,000
c) Payment of Rs.2,00,000 as accumulated balance from Recognised Provident Fund.
d) Payment of Rs.3,00,000 from an approved Superannuation Fund in lieu of an annuity.
His pension was fixed at Rs.4,000 p.m. On 1-2-2005 he commuted ½ of the pension for
Rs.1,50,000 he had provided a car by the company fro office purpose and private
purpose the capacity of car exceeds 106 litres and the maintenance and the Chauffeurs
Following deductions were made during the year from his salary
1) Income tax deducted at Source Rs.1,500 per month
2) Professional tax deducted at source Rs.200 per month
Compute the income of Mr.Dheeraj under the head-salaries for the assessment year 200506
20 Marks
2. a) Raj Furnishes the following particulars of his income earned during the previous
year 2004-05
1) profits from business in Delhi which is managed from outside India
1,25,000
2) Income earned from business inNepal which is controlled from India 2,00,000
3) Past profit of 1995-96 brought to India in 2004-05
40,000
4) Profit on sale of building in India but received in Nepal
1,30,000
5) Income from agriculture in Nepal received there but later on remitted
To India
60,000
6) Pension from a former employer in India, received in Nepal
20,000
7) Interest on F.D. With a Bank in India
i) Received in India
5,000
ii) Received abroad
4,500
8) Dividend on share if foreign Company
i) Received abroad
15,000
ii) Received in India
12,000
find out scope of the total income of Raj if he is (i) Ordinary Resident, (ii) Not Ordinary
Resident or (iii) Non-Resident in India for the assessment year 2005-06 12 Marks
b) Discuss the concept of residential status of an individual in detail.
8 Marks
3. Write short notes (ANY FIVE)
15 Marks
1) Person as defined in income tax act 1961
2) Block of Assets
3) Depreciation allowable u/s32
4) Annual Value
5) Agricultural Income
6) Income
7) Perquisites
4. a) Enumerate ten items discuss any three items of expenses which are not allowed an
while computing income from business
10 Marks
b) Discuss the incidence of tax in case of an individual
5 Marks
5. Mr.Pandit owns three houses one each at Mumbai. Delhi and Baroda the details of
which for the year ended 31-3-2005 are as follows :(1) The house at Mumbai has an annual rental value of Rs.75,000 and us occupied by
Mr.Pandit for his residence. He has to pay Rs.10,000 per annum. For municipal taxes for
constructing this house he had borrowed money of which 2,00,000 is still outstanding.
Interest is payable thereon @ 9.5% per annum. The house was vacant for Three Months.
(2) The house at Delhi has an annual rental value of Rs.1,25,000 and is also occupied by
Mr. Pandit for his residence whenever he comes to Delhi. The Municipal ground rent @
Rs.500 per month is also payable. Mr. Pandit had borrowed Rs.3,00,000 on 1-7-1999 for
carrying out repairs for the house on which interest @ 12% per annum is payable. He has
also paid fire insurance premium of Rs.2500 for the above house.
(3) The construction of the house at Baroda has been completed on 31-03-2002. and it
has 4 flats all of which have been rented out for residential purposes. The fair rent of each
flat is Rs.5000 per month whereas the actual rent received is Rs.6000 per month for 2
flats and Rs.4500 for the other 2 flats. Municipal taxes for each flat amount to Rs.3500
per annum. Other expenditure incurred for the above house is as follows:
a) Salary to rent collector Rs.1500 per month
b) Fire insurance premium Rs.1000 Per flat
c) Interest payable on loan taken for construction of the house Rs.36000
Calculate the income from House Property of Mr. Pandit for the assessment year
2005-06
6. (a) Mention in brief various deductions available to an assessee under the head Capital
Gains
8 Marks
(b) Explain the concept of capital and revenue expenditure and it’s relevance in
determining taxable income.
7 Marks
7. (a) What is meant by income from other sources? Give 5 examples of income
chargeable to tax under this head.
7 Marks
(b) Discuss the provisions of income tax Act regarding i) LIC premium, Contribution
to provident fund and ii) Interest on certain securities, dividends etc.
8 Marks
8. a) Explain briefly the exemptions available u/s 10 with reference to any five items
8 Marks
b) Describe the conditions to be fulfilled u/s 80 G (5) of the act by a charitable fund or
institution for being approved and recognized.
7 Marks.
___________________________
PART TIME SEM- III
University Paper 2004
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Question No1 and Q. No. 2 are compulsory and carry20 marks each.
2) Attempt any FOUR from the remaining question. These carry 15 marks each.
3) Make suitable assumptions wherever required.
Q.1. Mr.Ramlal the general manager of Y. Ltd. Retired on December 31,2003 after 30
years of service. The particulars of his income are as follows:
1) Salary Rs.8,000 per month from January 1,2003. house rent allowance
Rs.3,000 per month from January 1,2003
2) Medical expenses reimbursed by the employer Rs.21,000 for the period from
April 1,2003 which includes Rs.5,000 paid to a Government hospital.
3) The employer provides him a car of less than 1.6 litres capacity and driver for
official and personal use:
4) Ramlal contributes 22% (12% regular and 10% additional voluntary
contribution) to a recognized provident fund and the company matches his regular
contribution of 125
5) He lives in a rented house in Delhi and pays Rs.4,000 per month as rent.
6) Ramlal received Rs.1,50,000 as gratuity. He is not covered by the payment of
Gratuity Act. 1972
7) He received Rs.1,60,000 for encashment of lever; being 10 months leave no
availed of
8) In addition to the above he is provided with the other benefits and facilities
such as
a) Free gas and water for his domestic use Rs.4,000
b) A domestic servant (salary paid by the employer)3,500
c) Free lunch outside office Rs.5,000
d) Education allowance of Rs.6,000
Compute Mr. Ramlal’s Income for the assessment year 2004-05
20 Marks
Q.2. Following is the Profit and Loss account of SS Ltd. For the year ended 31-3-2004
Particulars
Rs.
Particulars
Rs.
To Opening Stock
By Sales
1,80,00,000
Finished goods
5,00,000
By Commission
30,00,000
Work in Progress 1,00,000
By Excess Provision no
6,00,000
Longer needed:
To Raw material consumed
44,00,000
For income tax
5,00,000
To Salaries, Wages, and bonus 16,00,000,
For expenses
2,00,000
To Power and fuel
4,00,000
By closing Stock:
To Stores
10,00,000
Finished goods
7,00,000
To Administrative expenses
5,00,000
Work In Progress
1,00,000
To Sales expenses
10,00,000
To Depreciation
15,00,000
To Interest to:
Suppliers for late payment
1,00,000
Unsecured lenders
4,00,000
Bank
2,00,000
Debentures
3,00,000
Financial Institutions
5,00,000
To provision for income tax
25,00,000
To Transfer to:
General reserve
Debenture redemption
To Interim dividend
To Proposed dividend
To Balance c/fd
30,00,000
15,00,000
10,00,000
15,00,000
5,00,000
2,25,00,000
___________
2,25,00,000
You are informed that1) sales expenses included Rs.50,000 being entertainment expenses.
2) Money borrowed through debentures was used for new plant and machinery costing
Rs.30,00,000
3) Depreciation allowable as per income tax rules is Rs.25,00,000
4) administrative expenses include Rs.20,000 paid for carrying on scientific research
5) Out of the interest debited to profit and loss account the following is unpaid:
a) To suppliers for late payment Rs.10,000
b) To financial institutes Rs.50,000
The above amounts were unpaid till 31st October 2004 the due date for filing the return of
income for SS ltd.
Shri Jash, The managing Director asks you to compute profit and gains of business for
the assessment year 2004-2005.
20 Marks
Q.3. Write short notes on (ANY THREE)
a) Exempt Income
b) Expenditure on Scientific Research
c) Deduction of Export profits
d) Entertainment allowance
5x3=15 Marks
Q.4.a) How will you determine the income from house property under the income tax act
b) Discuss briefly the specific deductions allowed while computing income form
House Property.
7+8=15 Marks
Q.5. What are the different categories of persons according to their legal status? Give an
illustration of each.
15 Marks
Q.6. a) Briefly discuss any 5 incomes, which are exempt under section 10 of the income
tax act
8 Marks
b) what do you mean by depreciation under Income Tax Act. briefly explain the
calculation of depreciation for Income Tax Act.
7 Marks
Q.7. a) Enumerate the provisions of “Set off and carry forward losses” as contemplated
under the Income Tax Act in respect of different types of business activities.10Marks
b) Discuss the scope of the head “Income form other Sources” and explain the
deductions available under the head.
5 Marks
Q.8. a)Explain Long Term Capital Gains. How do you calculate Long term Capital
Gains?
8 Marks
b) Briefly explain the deductions with respect to Long Term Capital Gains.7 Marks
___________________________
PART TIME SEM- III
University Paper 2003
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Only text of the Income Tax Act 1961 is permitted in the examination hall.
2) Attempt Question No1 and Q. No. 2 are compulsory and any FOUR of the
remaining questions i.e. Questions Nos 3 to 8
3) Question nos 1 and Q.2 carry20 marks each.
4) all other questions. are off carry 15 marks each.
5) Make suitable assumptions wherever required.
Q.1.write short notes on any of the FOUR
a) Dividend received by individuals
b) Concept of income accrued or arising
c) Depreciation allowable u/s32
d) payments made in cash
e) Concept of indexed cost of acquisition
f) Capital Asset and Transfer
g) Annual value
(4x5=20)
Q.2. Win Win ltd. Provides you with the following details to compute
Its income from business for the Assessment year 2003-2004
20 Marks
a) Net Profit for the financial year 2002-03 amounted to Rs.10,00,000/b) Income Tax paid for the financial year 2002-03 amounted to Rs.7,00,000/c) Dividend Income received during the financial year 2002-03 amounted to
Rs.2,00,000/d) Depreciation allowable u/s32, though provided in the profit and loss account amounted
to Rs.4,50,000/- is Rs.3,00,000/- only
e) Amounts received not taxable under the Act not credited to P& L A/c amounted to
Rs.5,00,000/f) Salary paid amounted to Rs.25,75,000/- was duly accounted before arriving at the net
profit of Rs.10,00,000/- for the financial year 2002-03
g) Discount paid amounted to Rs.2,00,000/- was duly accounted during the financial year
2002-03 before arriving at the net Profit mentioned above.
h) The disallowances u/s43B amounted to Rs.4,50,000/- during the financial year 200102 subsequently duly paid
Q.3. Discuss any three section under the Act which provide for exemption or deduction
in respect of export earnings
15 Marks
Q.4. Explain briefly the exemption available u/s 10 with reference to any five items
15 Marks
Q.5. Mr. A receives Salary of Rs.6,00,000/- during the financial year 2002-03. he claims
the Standard Deduction amounting to Rs.20,000/- and profession tax of Rs.3,000/Mr. A also receives income from other sources consisting of dividend income and
income from bank deposits amounting to Rs.50,000/-and Rs.5,000/- respectively. He also
informs of claim u/s88 amounting to Rs.10,000/You are advised to compute the taxable income of Mr.A.
15 Marks
Q.6. a) Distinguish between “Taxable profit and Commercial Profit
5 Marks
b) Any three specific disallowances under the head “Income from business or
profession”
10 Marks
Q.7. a) Explain the concept of capital and revenue expenditure
5 Marks
b) Give five examples of expenditure incurred wholly and exclusively for the
purpose of business
10 Marks
Q.8. Write short Notes on ANY THREE
a) Agriculture Income
b) AOP and BOI
c) Mediclaim
d) Speculation Losses
e) Stock Options
______________________________
(3x5=15 Marks)
PART TIME SEM- III
University Paper 2002
TAXATION
Time : 3 Hours
Total Marks : 100
Notes. 1) Question No1 and Q. No. 2 are compulsory and carry20 marks each.
2) Attempt any FOUR from the remaining question. These carry 15 marks each.
3) Make suitable assumptions wherever required.
1. Mr. Bhargav proprietor of ‘MAA AMBE gives you the following information about
his income from which you are required to calculate his taxable income for the
A.Y.2002-03
20 Marks
M/S MAA AMBE
Trading and Profit and Loss A/c for the year ended 31-3-2002
Rs.
Rs.
To opening Stock
2,84,028
By Sales
41,33,935
To Purchases
22,92,942
By Closing Stock
4,03,109
To gross Profit
19,60,074
________
_________
45,37,044
45,37,044
To Salaries
1,02,500
By Gross Profit
19,60,074
To Electricity
24,050
By Dividend on shares
3,048
To Printing and Stationery
12,098
By Interest on FD with Bank 2,050
To Traveling and Conveyance
1,66,094
To Telephone and Fax
78,195
To Interest on loan
2,84,520
To LIC Premium
22,000
To Income Tax
28,000
To Depreciation
1,54,500
To Staff Welfare
24,230
To Donation
22,000
To Postage
13,025
To Sales promotion
1,20,278
To Commission
2,00,000
To Professional fees
25,000
To Mediclaim
10,000
To Sundry Expenses
65,920
To Transportation
4,01,325
To Repairs
19,380
To Octroi
48,342
To Net Profit
1,43,715
_________
__________
19,65,172
19,65,172
Additional Information:
1) Salaries includes salary to proprietor’s wife Rs.Rs.20,000/2) Telephone and fax includes personal telephone expenses of Rs.7,068/3) Electricity expenses includes electricity charges for residential lines Rs.3,022/4) Depreciation as per Income Tax Act,1961 works out to Rs.2,01,643/5) Donation is eligible to 100% deduction u/s80G
6) Sundry expenses includes cost of furniture of Rs.24,000/7) LIC premium includes contribution to LIC Pension Scheme Rs.10,000/- eligible for
education u/s80CCC
8) Sales promotion includes payment of Rs.24,600/- in cash.
9) Mr. Bhargav has also earned interest of Rs.548/- on his savings account and Accrued
interest on his NSCs works out to Rs.6,048/2. Write short Notes on (ANY FOUR)
a) Agricultural Income
b) Receipts of casual and non recurring nature
c) Person as defined under the income Tax Act,1961
d) Income
e) Taxability of Gratuity
f) Deduction of Interest on housing loan u/s24(1)
g) Block of assets and Depreciation
20 Marks
3. Answer the following questions by giving reasons: (ANY THREE)
15 Marks
a) Mr. Ravi, a proprietor, receives a demand notice to pay sales tax of Rs.12,400/for the year 1995-96 which he had paid short in that year. He pays the same in Dec.2001.
whether he will be allowed this expense?
b) X. Ltd. Had written off Rs.3,20,000/- receivable from Y ltd. As bad debts in
the year 1999-2000. it receives Rs.1,80,000/- out of the same in the year 2001-02 whether
it is taxable ?
c) Mr. Monty receives advance salary of Rs.24,000/- in the month of March 2002.
the employers accountant treats this amount as his salary and deducts tax thereon. Mr.
Monty contends that this is the salary for the month of April 2002 and hence should be
taxed in the year 2002-03 relevant to A.Y.2003-04. whether his contention is justifiable?
d) Mr. Shrikant gives salary of Rs.24,000/- to his wife who is the commerce
graduate. The ITO wants to disallow the same. Is the ITO right in doing so?
e) Mrs. Rohini having salary Income of Rs.78,000/- sells her shares and suffers
from loss of Rs.8,400/- she claims that she had invested amount in those shares from out
of her receipts from salary so she should be allowed to set off the loss on sale of shares
against her salary income. Is her contention right?
4. a) Calculate Rebate u/s.88 in case of Mrs. Priya for the A.Y/ 2002-03 form the
8 Marks
following information:Deposit if PPF
12,000
Provident Fund deducted by employer
18,000
LIC Premium paid
6,000
Infrastructure Bonds purchased
18,000
Stamp duty paid on purchase of house
16,500
Registration fees paid for registration of agreement for purchase of house 12,300
Repayment of housing loan- principal
2,018
Interest
8,040
NSC purchases
10,000
Accrued interest on earlier NSCs
4,080
Contribution to LIC pension scheme
4,000
b) Explain the concepts of Rebate u/s88B and 88 c
7 Marks
5. Discuss the following receipts which are exempt form tax: (ANY THREE)15 Marks
a) Share of profit from partnership firm
b) Leave Travel Concession
c) HRA Received
d) Dividend
e) Commuted value of pension
f) Amount received under Voluntary Retirement Scheme.
6. a) Discuss the concept of residential status of an individual in detail
b) Discuss the incidence of tax in case of an individual
10 Marks
5 Marks
7. Mr. Rangnathan is employed in a company at Mumbai and gives you the following
information for the year 2001-02
15 Marks
i) He joined service in the pay scale of 1500-300-3000-500-6000 on 1st April
1993
ii) His other receipts are:
Dearness Allowance
150%of Basic
City Compensatory Allowance
Rs.600/-p.m
H.R.A.
Rs.3,000/-p.m
Self improvement Allowance
Rs.1,000/-p.m
Conveyance Allowance (to meet the
Cost of travel to and from office to res.Rs.1,000/-p.m
Commission
@ 0.1% on sales of Rs.2Crores
iii) He is provided with a car of mote that 16 h.p. rating along with chauffeur to be
used for both official and personal purposes.
iv) He had inherited house property form his uncle which he has let out on a
monthly rent of Rs.4,000/- he has take a loan to renovate the house and had
paid interest of Rs.12,600/- on the housing loan.
v) His inherited property not being at the place of his services, he is staying in
rented premises and paying a rent of Rs.5,000/-p.m.
vi) He has also received interest of Rs.502/- on his savings bank a.c
vii) An amount of Rs.20,000/- is deducted from his salary against his contribution
to provident fund and Rs.2,500/- is deducted towards Professional tax .
Compute his total taxable income for the A.Y.2002-03
8. a) The following information is available from Miss Reeta for the year 2001-02
1. she has two house properties the details of which are as under:- 15 Marks
Particulars
House1
Self Occuple
(Rs.)
Municipal valuation
60,000/Rent received
----Fair Rent
72,000/Repairs
6,000/Cost of Purchase
3,60,000/Interest on housing loan
18,048
Municipal Taxes
10% of Municipal valuation
Insurance (as % of cost of purchase)
2%
Collection charges
---
House2
Let out
(Rs)
90,000/1,20,000/96,000/3,500/4,80,000/24,096/3%
1,500/-
2. She told 500 shares of X Ltd.@Rs/60/- per share in February 2002 which she
had purchased in November 1999 @ Rs.25/- per share. The cost inflation index for the
year 2001-02 was 426 whereas index for the year 1999-2000 was 389.
3. she received interest of Rs.1,080/- on FD with companies and interest of
Rs.580/- on her savings band a/c. the accrued interest on her NSCs is Rs.6,500/- she had
received interest of Rs.3,000/-on her investment in PPF and dividend of Rs.5,200/- on her
investment in shares. She had received Rs.6,000/- as interest from her investment in
postal monthly scheme.
4. she had donated Rs.5001/- to CRY where deduction @ 100% is available u/s
80G and Rs.101/- to charitable institution where deduction @ 50% is available.
5. she had also contributed Rs.4,000/- to LIC pension Scheme eligible for
deduction u.s.80 CCC .
Compute her total taxable income for the A.Y. 2002-03
b) Explain the concept of capital and revenue expenditure and it’s relevance in
determining taxable income.
8 Marks
c) Explain the concept of set off of losses under the same head of income and set off of
losses under different heads of income.
7 Marks.
_____________________