DISTANCE EDUCATION
M.B.A. DEGREE EXAMINATION, DECEMBER 2017.
Second Semester
DIRECT TAXES
(Upto 2012-13 Academic Year 2013 Calendar year)
Time Three hours Maximum 100 marks
SECTION A — X 8 40 marks)
Answer any FIVE questions.
All questions carry equal marks.
1. Describe the provisions related to residential status of an
individual.
2. Mr. Peter, a foreigner, came to India from Poland for the
first time on 1st April, 2009. He stayed here continuously
for 3 years and went to France on 1st April, 2012. He,
however, returned to India on 1st July, 2012 and went to
Poland on 1st December 2013. He again came back to
India on 25th January, 2016 on a service in India. What is
his residential status for the A. Y. 2016-17?
3. Explain any ten fully exempted incomes Covered under
Income Tax Act 1961.
4. Compute Gross salary from the given information:
Salary 14,000 p.m
DA 4,000 p.m. (D.A. enters into pay for service
benefits)
Sub. Code
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CCA 800 p.m.
HRA 4,000 p.m
Commission on turnover achieved by him is 24,000
Living in a rented house at Delhi and rent paid is
6,000 p.m.
5. Explain the provisions relating to set off of losses.
6. Viswanathan an employee of a Ltd. Company, working at
Madurai (Population 18 Lakhs) drawn 60,000 as basic
salary 5,000 as Dearness allowance (Forming part of
salary) and 6,000 as Commission. The company
provides a rent free unfurnished house to him. The house
is owned by the company. Fair rent of the accommodation
is 5,000 Per annum. Income tax, Gas, water and
Electricity bills paid by the employer 4,000 and 6,000
respectively. Determine the taxable value of the
perquisites.
7. From the following information compute the annual value
of the house:
Municipal value 2,00,000
Fair rent 1,80,000
Standard rent 2,50,000
Actual rent 30,000 p.m.
Building remained vacant for two months during the
previous year. Unrealised rent 30,000 Conditions of
Rule 4 are satisfied Municipal tax paid by the owner
1 5,000 and by the tenant 15,000.
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8. Jolly has the following assets and liabilities on the
valuation date 31st March, 2016:
(in lakh)
Residential house 60.0
A farm house — 15 km away from the
local limit of Kolkata 30.0
Car for personal use 16.0
Jewellery 24.0
Aircraft for personal use 180.0
Urban land (Construction is not permitted
under the law) 40.0
Cash in hand 11.0
Loan taken to purchase of aircraft 80.0
Compute the net wealth of jolly for the assessment
year 2016-17
SECTION B — × 15 60 marks)
Answer any FOUR questions.
9. "The incidence of income tax depends upon the
residential status of an assessee" Discuss.
10. Mr. Abdul Rahim was appointed in a factory on 1st
January, 2006 in the pay scale of 3,000-250-6,000. On
1st September, 2015 his service were terminated at the
time of retrenchment on account of Closure of business
and he received a compensation of 50,000 from his
employer under the Industrial Disputes Act and he
received also gratuity 37,500 under the Gratuity
Payment Act, 1972. He was entitled to avail earned leave
of 30 days each year. At the time of termination of his
service he was also paid 42,000 for 8 months earned
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leave not availed of by him during the period if service.
On 1st December, 2015 he got another appointment on a
monthly salary of 7,500. On 1st February 2016 in order
to meet the expenses for repair of his home, he received
an advance of 4 months' salary and also took a loan of
20,000 from his employer for the purpose. Determine his
taxable income under the head salary for the Assessment
Year 2016-17 assuming that the salary is due on the first
of the next month.
11. What are the due dates of installments and the quantum
of advance tax payable by companies?
12. What do you understand by Permanent Account Number?
What are the consequences for failure to apply for the
allotment of a Permanent Account Number?
13. Given below is the Profit Loss Account of a Timber
Merchant for the year ended 31st March 2016
Opening stock 25,000 Sales 5,00,000
Purchases 2,50,000 Rent of
Property
15,000
Wages 1,00,000 Closing Stock 35,000
Audit fees 1,000
Repairs( House Property) 2,000
General charges 1,500
Commission for raising
Loan
1,000
Bad Debts Reserve 500
Bad Debts 2,000
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Interest on capital 1,500
Contribution to Staff
Welfare Fund
2,500
Provision for Income tax 10,500
Depreciation (Allowable) 2,500
Net profits 1,50,000
5,50,000 5,50,000
You are required to compute his total income for the
assessment year 2016-17.
14. Sahas Company Ltd is a widely held domestic company.
The following are the particulars of its income in respect
of the previous year 2015-16:
.
Income from business 11,00,000
Interest on Govt. Securities 20,000
Short-term capital gains 30,000
Long-term capital gains 66,000
Dividend from Indian company 20,000
Dividend from Foreign company 20,000
Book profits u/s 115-JB 8,00,000
During the previous year company donated 50,000
to National Defence Fund by cheque. Compute
company's total income and tax payable for the
assessment year 2016-17.
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15. Kwality Electronics Ltd. is a domestic company in which
public are substantially interested. The following are the
particulars of income in respect of the previous year
2015-16 .
.
Interest on Govt. Securities 20,000
Income from business 5,00,000
Short-term capital gains 15,000
Long-term capital gains 33,000
Dividend from Indian company 10,000
Dividend from Foreign company 10,000
Book profits u/s 115-JB 9,00,000
Compute company's total income and its net tax
liability.