Mumbai University Solved Question Papers
Taxation Laws
Previous Year Question Paper with Solution
BLS LLB 5 Years · Sem 8
Apr 2011 Examination
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BLS LLB 5 Years Sem 8 Taxation Laws Apr 2011 Question Paper with Solutions
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First published on munotes.in on 24 October 2026.
This edition revised 30 October 2026.
Published by munotes.in, Mumbai.
Model answers written and edited by the munotes.in editorial desk.
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The University does not publish an official answer key for this paper. The answers in this volume are model answers, written to show how a full-mark answer is built. They are a study aid, not an authority on what an examiner marked.
The question paper reproduced here is the paper as set by the University of Mumbai at the Apr 2011 examination.
The law in these answers is stated as at October 2026. The Income-tax Act, 2025 replaced the Act of 1961 from 1 April 2026; each answer gives the 1961 section the paper asks for, with the 2025 section beside it. No wealth-tax is charged for the assessment year 2016-17 or any later year (section 3(2) of the Wealth-tax Act, as amended in 2015). Since 1 July 2017 the Maharashtra VAT Act covers only liquor and a few petroleum products, and the Central Sales Tax Act six goods; other goods are taxed under the GST Acts of 2017. The central sales tax rate on sales against Form C has been 2 per cent since 1 June 2008, though section 8(1) still prints 3 per cent. The standard deduction from salary, withdrawn from 2005-06 to 2018-19, is now Rs 50,000, or Rs 75,000 under the new regime.
Contents
The questions below are the paper as the University of Mumbai set it at the Apr 2011 examination, in the order it was set.
MarksPage
MarksPage
The Paper as Set
The questions in this volume are the questions asked at the Apr 2011 examination, reproduced as the University of Mumbai set them, in the order it set them. Nothing has been reworded, added or left out. Only the answers are ours. See the original question paper.
Duration 3 hours · Total marks 100 · 25 questions answered
How to use this volume
Solve the paper first, under exam conditions and against the clock. Then read the answers here and mark your own. Reading a solution before attempting the question feels productive and teaches very little, because recognising an answer is not the same as being able to write one.
Q.1
Q.1: Write short answer, not more than two sentences
20 Marks - 2 marks each
(a)What is Capital gain under the Income Tax Act?[2]
Answer
A capital gain is the profit arising from the transfer of a capital asset. Section 45(1) of the Income-tax Act, 1961 charges "any profits or gains arising from the transfer of a capital asset effected in the previous year" under the head "Capital gains". It is taxed in the year of the transfer.
Its three elements.
- A capital asset (section 2(14)): property of any kind, except stock-in-trade, personal effects and rural agricultural land, among others.
- A transfer (section 2(47)): a sale, exchange, relinquishment, extinguishment of rights or compulsory acquisition, among others.
- A gain: the full value of the consideration less the cost of acquisition, the cost of improvement and the transfer expenses (section 48).
Short and long. A gain is short-term or long-term by how long the asset was held (section 2(42A)). In 2012 the general period was 36 months, and 12 months for listed shares. For transfers from 23 July 2024 it is 24 months, and 12 months for listed securities.
Rates now. Long-term gains are taxed at 12.5 per cent without indexation (section 112). Short-term gains on listed equity shares sold with securities transaction tax are taxed at 20 per cent (section 111A). Other short-term gains are taxed at the normal rates.
Example. Ravi buys a flat for Rs 40 lakh in 2018 and sells it for Rs 70 lakh in 2025. His long-term capital gain is Rs 30 lakh, before exemptions such as section 54.
The 2025 Act. Section 67 of the Income-tax Act, 2025 carries the charge.
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