St. Joseph’s College of Commerce B.Com. 2015 V Sem Income Tax – I Question Paper PDF Download

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ST. JOSEPH’S COLLEGE OF COMMERCE (AUTONOMOUS)
END SEMESTER EXAMINATION – SEPT./OCT.2015
B.COM – V SEMESTER
C1 12 501: INCOME TAX – I
Duration: 3 Hours                                                                                             Max. Marks: 100
SECTION – A
I) Answer ALL the questions.  Each carries 2 marks.                                        (10×2=20)
  1. Determine the status of the following persons

a)      RBI

b)     Reliance industry limited

c)      Markfed

d)     A & B who are carry on business with an agreement
  2. Determine Previous Year for the Assessment Year 15-16

a)      Business commenced on 1-1-15

b)     X who joins a company  on 1-1-14
  3. Identify the type of receipt:

a)      Price received on sale of know-how

b)     Royalty received in advance
  4. How do you determine the residential status of a Company.
  5. How is entertainment allowance exempted for the Government employee
  6. Mr. A joined central government job on 1st October 2012 in the grade of Rs.30,000-1,000-50,000. What is his salary for the previous year 2014-15.
  7. Compute exemption in case of the  following:

a)      Transport Allowance

b)     Children hostel allowance
  8. An AC was transferred by the company to his employee for Rs. 26,000 on 1/12/14. Its cost on 1/11/12 was Rs. 40,000. What is the value of the perk?
  9. How do you treat arrears of rent received in the previous year?
  10. Give any two cases where income from House Property is exempt
SECTION – B
II) Answer any FOUR questions.  Each carries 5 marks.                                      (4×5=20)
  11. Mr. K an Indian citizen leaves India for the first time on 31st May 2010 and comes back on 15th May 2013. He again leaves on 10th June 2014 to come back on 14th January 2015. Determine his Residential status for AY 15-16.

 
  12.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 From the following information submitted by X, in respect of monthly salary and allowances, find out the house rent allowance chargeable to tax for the assessment year 2015-16:

Name of the employer of X A Ltd. B Ltd.
Period of employment Up to July 31, 2014 From Sep.1, 2014
Place of posting Agra Bombay

(from feb.1, 2015: Goa)

 

 
  Rs. Rs.
Basic salary *(increased to Rs.25,000 from March 1, 2015) 16,000 21,000*
House rent allowance 9,000 11,000
Rent paid at Agra (from April 1, 2014 to Aug. 31, 2014) 8,200 –
Rent Paid at Bombay (from Sept.1, 2014 to Jan. 31, 2015) – 12,000
Rent paid at Goa (from Feb.1,2015) – 9,000
  13. Calculate the tax  liability of Mr. H

Net agricultural income Rs. 50,000

Non agricultural income Rs 2,95,000

 
  14. A  took a housing loan of Rs. 10 lakhs from a bank as under

On 1/5/2008 Rs. 4,00,000 @ 10%

On 1/11/2009 Rs. 4,00,000 @ 9%

On 1/1/2011 Rs. 2,00,000 @ 8%

House was completed in October 2011. He repaid Rs.2,00,000 on 1st December 2014 and bank adjusted this amount against the loan of 2008.

Determine amount of deduction admissible u/s 24 if house is let out.

 
  15. Explain in detail provisions of:-

a)      Gratuity

b)     Commuted Pension

 
  16. X retires on 1st July 2014 after 18 years of service and receives Rs.75,000 as amount of leave encashment for 15 months. His employer allows 45 days leave for every one year of service. During service he has already encashed leave for 12 months. Calculate his taxable income if his average salary during 1-7-13 to 1-7-14 was Rs. 5,000
SECTION – C
III) Answer any THREE questions.  Each carries 15 marks.                                (3×15=45)                                                                                                
  17. X (53 years) owns a house property.  It is situated at Nariman point, Mumbai.  The following information is available:

  `
Municipal valuation 33,20,000
Market rent of a similar property at Nariman Point, Mumbai 60,00,000
Market rent of a similar property at Andheri (East), Mumbai 38,00,000
Standard rent 57,00,000
Municipal tax of 2014-15 4,50,000
Municipal tax of 2014-15 paid in 2014-15 3,92,000
Municipal tax of 2013-14 paid in 2014-15 3,00,000
Advance municipal tax for next 5 years paid in 2014-15 18,00,000
Repair expenses (10 per cent is borne by tenant) 90,000
Insurance 80,000

 

The above property is let out on monthly rent of Rs.5,70,000 up to June 30, 2014.  Tenant has vacated the property on June 30, 2014 without paying one month rent.  The property is lying vacant during July and August 2014 as no suitable tenant is available.  X occupies the property for his own residence from September 1, 2014.  Till September 1, 2014, he resides in a rented accommodation for which he pays rent of ` 80,000 per month.  Construction of the property was completed in April 2013.  A loan of ` 90,00,000 was taken to finance construction of the property.  This loan was taken from an Indian private limited company.

Interest liability pertaining to the period ending March 31, 2013 is ` 24,80,000.  Interest liability for the previous year 2014-15 is Rs.11,50,000.  Every year interest is paid on due dates.  However, tax is not deducted under section 194A.

X recovers on March 20, 2015, one month’s unrecovered rent from the tenant.

Find out the income from house property for the assessment year 2015-16.

 
  18. X an employee of a private sector company at Coimbatore, retires on January 31, 2015.  He submits the following information-

  1.  Basic salary:  ` 80,000 per month.
  2. Dearness allowance (forming part of salary): ` 5,000 per month.
  3. Retirement gratuity not exceeding ½ months salary for each year of completed service computed on average salary of last 10 months claimed exempt under section 10 (10)(ii), he is not covered by the Payment of Gratuity Act, 1972: ` 11,50,000.
  4. He does not have any leave to his credit at the time of retirement.  However, the employer has paid leave encashment of Rs.30,000 under company’s service rules.
  5. He has been allotted a furnished house at Coimbatore (population:26 lakh) by the company.  He has not vacated this property till March 31, 2015.  Lease rent of the property paid by the employer company is Rs.20,000 per month.  Besides, the company pays Rs.3,000 per month as rent of furniture provided along with the house.  The company does not charge any rent till the date of retirement.  However, a nominal rent of Rs.9,000 per month is charged after retirement in respect of the facility of rent-free furnished house.
  6. He has been provided with a car from the employer –company (1610 cc) without driver but only for coming and going from residence to office and back.
  7. A company maintains recognized provident fund to which each employee along with the company contributes 12 per cent of salary.
  8. Interest is credited in the provident fund account at the rate of 8.5 per cent which comes to ` 95,000.
  9. Professional tax paid by X : ` 2,000 on April 1, 2015.
  10. X wants to claim a deduction of   ` 20,000 on account of entertainment expenditure incurred by him for official purposes.  Nothing is reimbursed by the company on this account.

Compute Income taxable under the head salaries.
  19. Mrs. X (44 years) received the following income from B Ltd. during the year ending March 31, 2015:

       `
Salary @ Rs.30,000 per month 3,60,000
Leave travel concession for proceeding on leave (expenditure on air fare:  72,000) 75,000
Lunch allowance @ Rs.3,000 per month (expenditure:  `36,000) 36,000
Medical allowance (expenditure:  ` 20,000) 24,000
Allowance for purchase and maintenance of uniform for official use (expenditure incurred by X:  ` 4,000) 18,000

 

Mrs. X also enjoyed the following benefits and perquisites:

Free unfurnished flat in Bombay for which employer is paying a monthly rent of Rs.30,000.

Free use of a Maruti alto car with driver for personal use and official use.  Car can also be used by the family members of Mrs. X.

Free service of personal attendant (Salary:`12,000) and sweeper (Salary: `  18,000)

Free use of employer’s DVD player (costs to the employer:  `32,000, year of purchase: 2002-2003)

Compute net income of Mrs. X for the assessment year 2015-16, on the assumption that her income from other sources is ` 40,000.

 
  20. X gives you the following information pertaining to the previous year ending on March 31, 2015:

  `
Royalty from a patent registered in USA (royalty is received outside India from a foreign company and the foreign company has used the patent for manufacturing purposes in India) 20,00,000
Dividend from an Italian company (X holds 55 per cent shares in the Italian company, business of the company is partly controlled from India and dividends are received outside India) 18,00,000
Profit of a sole proprietary business situated in Dubai, received in Mauritius (business is entirely controlled from India) 4,50,000
Loss from a business situated in Pakistan (controlled from Pakistan) (-) 2,00,000
Rent of a commercial property situated in Bhutan (received in Nepal) 2,35,000
Speculation profit earned and received in India on April 1, 2016 4,00,000
Profit on sale of a house property situated in UK (50 per cent is received in Chennai and 50 per cent is received in UK) 1,77,000
Income from a profession set up in Bangalore (consultancy is provided in UK and amount is received in UK) 8, 32,000

 

Find out net income of X for the assessment year 2015-16 on the assumption that (a) X is resident and ordinarily resident in India (ROR), b) X is resident but not ordinarily resident (RNOR), (c) X is non-resident (NR) in India.

 
  21. Bring out in detail provisions relating to

a)      SPF , RPF , URPF and PPF

b)     Any five fully exempted incomes

(10+5)
SECTION – D
IV) Case Study                                                                                                              (1×15=15)                                                                                           
  22. Mr. W owns and occupies two houses for his residence and claims to have no income from house property. From the following information would you agree with him or do you consider he has taxable income from house property. Analyse.

  HOUSE A HOUSE B
Standard Rent 36,000 56,000
Fair Rent 42,000 62,000
Municipal valuation 24,000 44,000
Municipal taxation paid 1,200 1,200
Municipal taxes due 1,200 1,200
Ground rent paid 1,000 500

Date of completion of these houses was 31-1-12. He had taken a loan of Rs.2,50,000 @10% p.a for construction of House A on 1-6-2010 and he repaid Rs. 2,00,000 on 1-10-2014

 

 

 

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