BCom In Accounting & Finance (BCAF) SEM V 2017 18 Nov 2017-18 TAXTATION III DIRECT TAX Question Paper - Mumbai University | munotes

Questions asked in this paper

1. Q1 (A) Multiple choice questions : (Any 8) 8 marks
   • (1) Deduction u/s. 54 is available to:
   • (a) Individual
   • (c) Individual and HUF
   • (d) All assessee
   • (2) Payment received by an employee in respect of encashment of earned leave during service is :
   • (a) Taxable as Salary
   • (b) Taxable as Income from Other Sources
   • (c) 50% is exempt and balance taxable as salary
   • (d) Fully exempt under section 10
   • (3) For non-government employee governed by the Payment of Gratuity Act, 1972, the maximum monetary limit for exemption is :
   • (d) Limitless
   • (4) For the purpose of claiming higher deduction u/s. 24(b) while computing income of a self-occupied property assessee is required to take :
   • (a). Loan on or before 1.4.1999
   • (b) Loan on or after 1.4.1999
   • (c) Loan after 1.4.1998
   • (d) Loan on 1.4.1998
   • (5) The maximum quatum of deduction by way of interest on money borrowed for construction of self-occupied house property is :
   • (6) Asumof ~50,000 was written off as bad debt in the books, in the assessment year 2013-14 and was disallowed. During the financial year 2016-17 20,000/ as recovered. Out of the recovery how much is taxable ?
   • (b) NIL
   • (7) AJ Pvt. Ltd makes a payment of in cash to a labour contractor for repair job, in a single day. The disallowance under section 40A(3) will be :
   • (d) NIL
   • (8) ALtd. had an opening WDV balance of on 1.4.16, for a block of plant and machinery (15% depreciation). During the year it purchased a machinery, falling in the block, on 1.11.2016 for 50,000/-. Depreciation admissible on the block for the financial year 2016-17 is :
   • (9) The maximum amount of standard deduction in case of family pension is :
   • (10) Amount of deduction in case of a person with severe disability under section
   • (B) State whether the following statements are true or false (Attempt any 7) : 7
   • (1) Municipal taxes paid by tenant is allowed as deduciton u/s 16
   • (2). Any expenditure incurred on winning from lottery is allowed u/s 57
   • (3) Lunch facility is fully exempt
   • (4). Penalty for breach of law is allowed as deduction
   • (5) Income of minor is exempt
   • (6) Dividend from Co-Operative society is taxable
   • (7) Maximum limit of deduction under section 80C and 80CCC is = 2.00,000
   • (8) Only Reducing Balance method is allowed for depreciation in case of
   • (9) Gross Annual Value of Deemed to be let out property is to be considered
   • (10) Gift from friend is fully taxable
2. Q2 (a) Ajay purchased 100 equity shares XYZ Ltd. on Ist January, 2003 for 500 per share and incurs expenditure on brokerage of 0-50 per 100. On May Ist, 2015 he gets bonus of 100 shares. On August Ist, 2016 he gets on 200 rights shares for = 540 per share. On 31st January ,2017 he sells 300 shares for 800 per share and incurs an expenditure of 480 on brokerage Compute his taxable income for A.Y. 2017-18, he does not have any other source of income. (Assume FIFO Method) The Cost inflation index for the F.Y. 2002-03 is 447; for the F.Y. 2015-16 is 1081; 7 marks
   • (b) Mr. Z sells a residential house at Mumbai for 90,00,000/- on Ist January, 2017 The house was acquired by him for 4,00,000/- on Ist June, 1993. The value of the house as on 1.4.1981 was 90,000/- and the previous owner bought the house for 75,000/- in the year 1975-76 Z pays brokerage @2% at the time of sale of the house. He had carried out major repairs and renovation of his Mumbai house in April 2012, which amounted to In March 2017 from the sale proceeds of Mumbai house he invests in a residential house in Mumbai Compute the capital gains taxable in the hands of Mr. Z for the assessment year The cost inflation index for the year 1981-82 is 100; for 1993-94 is 244; for 2012 13 is 852; for the F-Y. 2015-16 is 1081; for 2016-17 is 1125
3. Q2 Mr. Panchal is a Finance Manager of K Private Ltd. During the year, he voluntary retired from the company on per the terms and conditions offered by the company On voluntary Retirement he received 6,50,000 and was also entitled to a pension of 20,000 p.m. for next 10 years. He commuted 80% of his pension for = 16,00,000 His other emoluments during the year ended 31st March, 2017 were as follows : 15 marks
   • (a) Net salary up to 31-12-2016 = 60,800 p.m
   • (e) Leave salary encashment for the year 2016-17 during service 50,700
   • (f) terms 20% of basic salary
   • (g) Children Education allowance for 3 children = 1000 p.m The following were deducted from his salary every month till his retirement
   • (a) Tax deducted at source = 4000/
   • (b) Professional Tax = 200/ Compute taxable Salary for Mr. Panchal for the previous year he is covered under Payment of Gratuity Act, 1972
4. Q3 Vijay furnishes the following information relevant for the P.Y. 2016-17. Profit and Loss Account for the year ended 31st March, 2017 Audit fees 12,000 | not allowed as a Extension of building 16,000 | Income tax refund from 12,500 Depreciation on plant 29,000 | Govt. (including interest Salary to staff Interest from PPF 9,000 15 marks
   • (a) Depreciation on plant & machinery and extension of building as per income tax provision is = 25,000
   • (b) Sales tax of 38,000 includes (1) interest for late payment of sales-tax 1800 penalty for evading sales-tax 5000
   • (c) Advertisement expenditure was paid by bearer cheque (single payment)
   • (d) Salary to staff includes a payment of 5000 to the relative Ascertain the income of Vijay chargeable under the head Income from Profits & gains of Business and net taxable income for the Assessment year 2017-18
5. Q3 Mr. Srikumar, a practicing Chartered Accoutant, gives you the following Receipts Payment Account for the year ended 31st March, 2017 To Balance b/d 9,000 | By Salary to Staff 80,000 To Professional Fees 1,50,000 | By Printing and Stationary 5,500 To Gift from father 15,000 | By Household expenses 22,400 To Gift from Client 15,000 | By Conveyance expenses 9,000 To Salary from College By General expenses 20,000 as a lecturer By Purchase of Car in July 2011 100,000 To Loan from a Bank for By Motor Car expenses 20,000 Purchase of Car 50,000. | By Mediclaim Insurance Premium 6,500 By Interest on Bank Loan 5,000 By Income Tax 8,500 By Professional Tax 800 15 marks
   • (1) Depreciation allowable on Motor Car, as per Income Tax rules is 15%
   • (2) Itis considered that 25% of the car expenses are for personal use
   • (3) Household expenses include given as a marriage gift to an employee
   • (4) Salary includes 12,000 paid to son, who is commerce graduate (seems to be Compute the Net Taxable Income of Mr. Srikumar for the A.Y. 2017-18
6. Q4 A owns two houses, both of which are occupied by him for residential purpose. The details are given below : Date of completion of construction 01.02.2002 01.07.2010 Date of Loan 01.07.1997 01.05.2006 Interest on Loan for the financial year 2016-17 1,10,000 1,70,000 Compute his income from house property and advice which house should be opted by him as self occupied. [TURN OVER 15 marks
7. Q4 Ya foreign citizen (not being the person of Indian origin) comes to India, for the first time in the last thirty years on 20th March, 2016. On September Ist, 2016, he leaves India for Nepal on a business trip. He comes back on February 26th, 2017. Detemine his residential status and based on the additional information on his income, compute his total income under the Income Tax Act, 1961 Sr. No. Particulars z 15 marks
8. Q1 Rental Income from property in Sri Lanka remitted by the 2,10,000 tenant to Y in India
9. Q2 Loss from business in Sri Lanka (whose control and 80,000 management of business wholly remained in India)
10. Q3 Profit from business in India. 1,00,000
11. Q4 Dividend received from shares in foreign companies 1,20,000
12. Q5 Dividend from a Korean compay received in France. 50,000
13. Q6 Rent from property in Sri Lanka but latter remitted to 1,00,000
14. Q7 Profit of financial year 2012-13 which was not taxed in Sri Lanka now remitted to India
15. Q8 Profit on sale of shares of an Indian company, sold in 30,000 Sri Lanka and the proceeds were received in France
16. Q5 (a) Discuss the concept of ‘Gross Annual Value’. Also discuss the impact of Vacancy Loss on the “Gross Annual Value’ 8 marks
    • (b) Discuss the major salient features of ‘Depreciation’ u/s. 32 of Income Tax Act, 7
17. Q5 Write short notes on (any three) :— 15 marks
    • (a) Assessee
    • (b). Deemed Owner Chargibility of Capital Gains on Compulsory Acquisition of Asset
    • (d) Resident and Ordinarily Resident
    • (e) Deduction u/s. 80.D

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