BCom In Accounting & Finance (BCAF) SEM III 2017 2018 Nov 2018 TAXTION II DIRECT TAX I Question Paper - Mumbai University | munotes

Questions asked in this paper

1. Q2 Each question carries 15 marks
2. Q3 Working notes form part of answer
3. Q4 Use of simple calculator is allowed
4. Q1 (A) Match the following (any eight and rewrite the sentences) :— Column I Column IT 8 marks
   • (a) An Indian Company 1. Business Income
   • (b) Expenditure incurred by Employer Not a Business Income for medical treatement of depedent mother-in-law of employee
   • (c) Standard Deduction from 3. Asset
   • (d) Arrears for Rent Received 4. Nota Capital Asset during the year
   • (e) Voluntary Gift from Customer Ordinarily Resident
   • (h) Stock in trade Tax Free Perquisite up of acompany outside India 9. of Net Annual Value
   • (j) Subsidised lunch 10. 1/3 of Net Annual Value
5. Q12 No standard Deduction Allowed
   • (B) State whether the following are true false (any seven) :— 7
   • (a) An association of person consists of all 7 persons
   • (b) Residential status depends only on nationality
   • (c) Income earned in India is not taxed in the hands of Non Resident Assesse
   • (d) Ifthe business is commence on 1-9-16, the first previous year will end on 31-8-2016 for the assessment year 2017-18
   • (e) GAV for SOP in NIL
   • (f) The owner is not allowed to occupy more than one house for residence
   • (g) Municipal taxes are deductible on payment basis
   • (h) An assesse is defined under section 10
   • (i) Interest on borrowed capital is deductible on due basis
   • (j) includes reassessment
6. Q2 Binod is working in a limited company since Ist Nov 08 on a salary scale 1,000-10,000-2 he is also entitled to D.A. of 60% of basic pay and CCA of 40% basic. He received a bonus of 30,000 and salary in lieu of Leave Salary of one month becomes due on 5th of next month. He has following other incomes : Interest on Deposits under National Deposit Scheme 7,000 Interest on Deposits with Y Ltd. 6,000 Interest on Units of UTI 2,500 Interest on deposit with State Housing Board 1,500 Interst on 9 per cent Relief Bonds 2,200 Interest on deposits with IDBI 1,000 Interest on Deposits under National Savings Scheme, 1993 4 300 He has deposited in pension fund set up by LIC of India and he has paid medical insurance premium of 4,000 You are required to calculate his Total Income and tax liability for A-Y. 2017-18 15 marks
7. Q2 Mrs. Lisa aged about 66 years is a Finance Manager of M/s. Lakme & Co. based at Calcultta. She is in continuous service since 2004 and receives the following salary and perks from the company during the year ending 31-3-2017 15 marks
   • (i) Basic Salary (50,000 x 12) = 6,00,000
   • (ii) DA (20,000 x 12) = = 2,40,000
   • (iv) Commission 0-1% of the turnover of the Company. The turnover for the financial year was 15-00 crores
   • (v) Contribution of the Employer and employee to the PF Account (v1) Interest credited to P. F. Account at 8-5% — 60,000 (vil) Rent free unfurnished accomodation provided by the company for which the company pays a rent of = 70,000 per annum
   • (ix) Children's education allowance to meet the hostel expenditure of the children She makes the following payments and investments : Premium paid to insure the life of her major son — 15,000 Medical Insurance Premium for self — 22,000 and spouse = 5000 Determine the Net Taxable income for the A.Y. 2017-18
8. Q3 Following is the receipts and payments of Dr. Rajiv for the year ended 31-3-17. To Balance b/f By Salaries 24,000 Cash-in-hand 1,500 Cash-in-bank 3 000 4,500 To Consulting fees 4,08,100 By Bonus to staff 2 400 To Visit fees 14,500. By Printing and Stationary 3,600 To Gift from patients By Rent of Clinic 12,000 To Rent from Subletting 95,000 Electricity 11,150 To Fees form Air India By Car Expenses 30,000 To Interest on Bank FD 17,900. By Int. on car loan 15,000 (TDS & 2,100) By Drawings By Contribution to an app. 8,000 College for Donation By Misc. Expenses 2,850 Cash in hand 54,000 Cash with bank 1,00,000 FD with Bank 33,000 1,87,000 15 marks
   • (1) Purchases represent. Medicines 50,000, Motor Car 2,56,000 and Books
   • (2). Depreciation allowable : Motor Car Books = 25,000 and Equipments You are asked to calculate his total income for A.Y. 2017-18
9. Q3 Shri Babu Bhai submits the following P & L A/c of his business : To Salaries & Wages 1,65,000 By Gross Profit 5,23,000 To Printing Charges 25,500 By Income from Company To Travelling & Conveyance 16,000 By Interest on Bank Fixed To Repairs 3,000 Deposits 6,000 To Life Insurance Paid By Income from State To Bank charges for collection Government Securities 5,000 of Income of Company By Income tax refund 500 To Bad Debts 32,000 To Income Tax Paid 14,000 To Provision for doubtful debts 11,500 To Interest on loan taken for To Net Profit 1,34,000 15 marks
10. Q1 Depreciation allowed as per Income Tax Rules is 88,000
11. Q2 Printing includes paid for printing marriage invitation cards of his daughter Babu bhai has paid life insurance premium on the life policy 1,15,000 taken on the life of his wife
12. Q4 Repayment of interest on loan taken for higher education is 60,000 and principal repayment is 25,000 for his son You are required to compute the Taxable Income of Mr. Babu Bhai for the A.Y. 2017-18
13. Q4 Ms. Tanuja submits the following details for the A.Y. 2017-18. Details of Income from House property Interest on Capital borrowed by mortaging House I (Funds utilised for construction of Housel) 4,800 = Nature of Occupation Let out for Let out for She invested 70,000 in PPF A/c, in NSC and 20,000 as LIC premium paid for self and spouse. She also paid Medical Insurance Premium of 29,000 for self and spouse and 29,000 dependent parents 15 marks
14. Q4 (A) Raghavan owned a residential house at Madurai, the original cost of which It was acquired on 1-9-2000. He sold the house on 1.6.2012 for 18,00,000 and purchased another house and 30-5-2014 at Tiruchi The second house at Tiruchi was sold by him for = 18,00,000 on 30-6-2016 Discuss the impact of these transactions with regard to assessment to capital gain 8 marks
    • (B) Mr. Sandeep has earned the following income during the previous year ended — 7 Professional fees received in India for three months 18,000 Payment received in UK for services rendered in India 16,000 Income from business in Australia, controlled from India 14,000 Income from Agriculture in Bangladesh 12,000 Dividend from a foreign company received in UK 10,000 Amount brought into India out of the past untaxed profits earned in USA 18,000
    • (i) He is resident and Ordinarily Resident
15. Q5 (A) Write any eight exempted Income U/s 10 of Income Tax Act 1961. 8 marks
    • (B) Enumerate any seven expenses not allowed in computing income from business 7 under Income Tax Act 1961
16. Q5 Write short notes (any three) :— 15 marks
    • (i) Short term capital gain Gross Annual Value of House Property
    • (iii) Exemption U/S 10 for leave salary
    • (iv) Residential status of an individual
    • (v) Person

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