University Of Pune Question Paper
M.Com. (Semester – I) Examination, 2013
Advanced Accounting and Taxation
Special Paper – II
INCOME TAX
(Group – A)
(2008 Pattern)
Time : 3 Hours Max. Marks : 100
Instructions : 1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Read questions very carefully before attempting the same.
4) Use of calculator is allowed.
1. Answer any two of the following : 15
a) State any five special allowances exempt U/S 10(14).
b) What is the difference between capital expenditure and revenue expenditure ?
c) What are the provisions relating to Tax Audit U/S 44 AB ?
d) Deductions from Net Annual Value U/S 24.
2. Write short notes (any three) : 15
a) Previous year and assessment year
b) Assessee
c) Cost of improvement and indexed cost of improvement
d) Gross total income
e) Depreciation allowable U/S 32 of Income Tax Act, 1961.
3. Mr. Z (age 58 years), an employee of a private sector transport company,
based at Pune and covered by the Payment of Gratuity Act, retires on
December 31, 2012 after service of 33 years and 7 months. 16
At the time of retirement, his employer pays Rs. 19,61,530 as gratuity and
Rs. 5,00,000 as accumulated balance of recognised provident fund. He is also
entitled for a monthly pension of Rs. 7,000. He gets 70% of pension commuted
for Rs. 2,10,000 on February 1, 2013. Determine the taxable income and tax
liability for the Assessment year 2013-14 with the help of the following information :
Basic salary Rs. 7,20,000 (Rs. 80,000×9)
Bonus Rs. 36,000
Special allowance Rs. 2,20,000
House rent allowance Rs. 1,17,000 (Rs. 13,000×9)
Rent paid by him Rs. 1,20,000 (Rs. 10,000×12)
Employer’s contribution towards RPF Rs. 1,10,000
Z’s contribution towards RPF 1,20,000.
Payment of insurance premium on 31st March 2013 amounting to Rs. 11,000
Professional tax paid Rs. 2,000
Income from other sources Rs. 7,50,000
Salary and pension fall due on last day of each month. Z and his family members
can use deluxe buses operated by the employer company (value of the facility
enjoyed by X and family members during October, 2012 is Rs. 9,000 & a sum of
Rs. 3,000 is recovered from X).
4. Mr. Y (age : 40 years) is a businessman in Mumbai. Determine his net income
and tax liability on the following Profit & Loss Account for the year ending
March 31, 2013 : 16
Particulars Rs. Particulars Rs.
Opening stock 1,04,000 Sales 92,61,000
Purchases 80,07,750 Closing Stock 2,10,000
Salaries and wages 1,75,000
Rent and rates 1,31,000
Commission 21,500
Household expenses 22,000
Income Tax for 2012-13 36,100
Advertisement 5,000
Postage and telegram 4,000
Interest on own capital 85,000
-3- [4370] – 104
Reserve for bad debts 3,400
Depreciation on furniture 18,000
Net profit 8,58,250
94,71,000 94,71,000
Other particulars :
1) Closing stock & opening stock has consistently been valued at 10% below
cost price.
2) Depreciation on furniture as per tax provision is Rs. 17,200.
3) Household expenses include a contribution of Rs. 1,000 towards public
Provident Fund.
4) On September 20, 2012, Y has received a gift of Rs. 96,000 from a friend
settled in U.K.
5) He paid medical insurance of Rs. 10,000 by an account payee cheque.
5. S owns three houses, which are situated in three different cities. All the houses
are meant for self-occupation of the assessee. The particulars of the houses
are as under : 16
Particulars House A House B House C
Municipal valuation 1,50,000 1,80,000 2,10,000
Fair rent 2,10,000 2,25,000 2,40,000
Standard rent 1,95,000 2,40,000 2,25,000
Municipal taxes paid 45,000 30,000 1,20,000
Interest on money borrowed
for purchase of house 50,000 30,000 25,000
Ground rent 10,000 – 12,000
Land revenue due – 10,000 –
Compute the income under the head House Property by making assumption in
such a manner that the tax liability of R is minimum.
6. A) R owns many properties in India. He sold some of these during the previous
year 1-4-2012 to 31-3-2013 : 10
1) House at New Delhi : Let out for residential purposes. It was inherited by
him in 1964. Sale price on 31-10-2012 Rs. 12,00,000. Fair market value
on 1 - 4 - 1981 Rs. 1,20,000. Cost of improvement made during 1989-90
Rs. 40,000. Expenses on transfer are Rs. 30,000.
2) Self cultivated land in an urban area was sold for Rs. 10,50,000 on
4 - 1 - 2013 and its cost in 1982-83 was Rs. 90,000. He purchased a new
piece of land for his own cultivation for Rs. 2,60,000 in June, 2013. From
the above particulars, compute total income assuming that he has no
other income except these. Cost inflation index are : 1982-83 – 109,
1989-90 – 172, 1996-97 – 305, 2012-13 – 850 (assumed).
B) The following are the particulars of income of M as determined by the
Assessing Officer. Compute his total income for the assessment year 2013-14.
Brought forward losses of the assessment year 2012-13 12
Rs.
Loss from speculation business 1,40,000
Unabsorbed depreciation 14,000
Details of income for A.Y. 2013-14
Profit from speculation in commodities 2,80,000
Loss of hardware business 38,000
Profit from business of paints (before charging depreciation of Rs. 1,50,000) 84,000
Profit from business of tyres 2,24,000
Income from house property 38,000
————
M.Com. (Semester – I) Examination, 2013
Advanced Accounting and Taxation
Special Paper – II
INCOME TAX
(Group – A)
(2008 Pattern)
Time : 3 Hours Max. Marks : 100
Instructions : 1) All questions are compulsory.
2) Figures to the right indicate full marks.
3) Read questions very carefully before attempting the same.
4) Use of calculator is allowed.
1. Answer any two of the following : 15
a) State any five special allowances exempt U/S 10(14).
b) What is the difference between capital expenditure and revenue expenditure ?
c) What are the provisions relating to Tax Audit U/S 44 AB ?
d) Deductions from Net Annual Value U/S 24.
2. Write short notes (any three) : 15
a) Previous year and assessment year
b) Assessee
c) Cost of improvement and indexed cost of improvement
d) Gross total income
e) Depreciation allowable U/S 32 of Income Tax Act, 1961.
3. Mr. Z (age 58 years), an employee of a private sector transport company,
based at Pune and covered by the Payment of Gratuity Act, retires on
December 31, 2012 after service of 33 years and 7 months. 16
At the time of retirement, his employer pays Rs. 19,61,530 as gratuity and
Rs. 5,00,000 as accumulated balance of recognised provident fund. He is also
entitled for a monthly pension of Rs. 7,000. He gets 70% of pension commuted
for Rs. 2,10,000 on February 1, 2013. Determine the taxable income and tax
liability for the Assessment year 2013-14 with the help of the following information :
Basic salary Rs. 7,20,000 (Rs. 80,000×9)
Bonus Rs. 36,000
Special allowance Rs. 2,20,000
House rent allowance Rs. 1,17,000 (Rs. 13,000×9)
Rent paid by him Rs. 1,20,000 (Rs. 10,000×12)
Employer’s contribution towards RPF Rs. 1,10,000
Z’s contribution towards RPF 1,20,000.
Payment of insurance premium on 31st March 2013 amounting to Rs. 11,000
Professional tax paid Rs. 2,000
Income from other sources Rs. 7,50,000
Salary and pension fall due on last day of each month. Z and his family members
can use deluxe buses operated by the employer company (value of the facility
enjoyed by X and family members during October, 2012 is Rs. 9,000 & a sum of
Rs. 3,000 is recovered from X).
4. Mr. Y (age : 40 years) is a businessman in Mumbai. Determine his net income
and tax liability on the following Profit & Loss Account for the year ending
March 31, 2013 : 16
Particulars Rs. Particulars Rs.
Opening stock 1,04,000 Sales 92,61,000
Purchases 80,07,750 Closing Stock 2,10,000
Salaries and wages 1,75,000
Rent and rates 1,31,000
Commission 21,500
Household expenses 22,000
Income Tax for 2012-13 36,100
Advertisement 5,000
Postage and telegram 4,000
Interest on own capital 85,000
-3- [4370] – 104
Reserve for bad debts 3,400
Depreciation on furniture 18,000
Net profit 8,58,250
94,71,000 94,71,000
Other particulars :
1) Closing stock & opening stock has consistently been valued at 10% below
cost price.
2) Depreciation on furniture as per tax provision is Rs. 17,200.
3) Household expenses include a contribution of Rs. 1,000 towards public
Provident Fund.
4) On September 20, 2012, Y has received a gift of Rs. 96,000 from a friend
settled in U.K.
5) He paid medical insurance of Rs. 10,000 by an account payee cheque.
5. S owns three houses, which are situated in three different cities. All the houses
are meant for self-occupation of the assessee. The particulars of the houses
are as under : 16
Particulars House A House B House C
Municipal valuation 1,50,000 1,80,000 2,10,000
Fair rent 2,10,000 2,25,000 2,40,000
Standard rent 1,95,000 2,40,000 2,25,000
Municipal taxes paid 45,000 30,000 1,20,000
Interest on money borrowed
for purchase of house 50,000 30,000 25,000
Ground rent 10,000 – 12,000
Land revenue due – 10,000 –
Compute the income under the head House Property by making assumption in
such a manner that the tax liability of R is minimum.
6. A) R owns many properties in India. He sold some of these during the previous
year 1-4-2012 to 31-3-2013 : 10
1) House at New Delhi : Let out for residential purposes. It was inherited by
him in 1964. Sale price on 31-10-2012 Rs. 12,00,000. Fair market value
on 1 - 4 - 1981 Rs. 1,20,000. Cost of improvement made during 1989-90
Rs. 40,000. Expenses on transfer are Rs. 30,000.
2) Self cultivated land in an urban area was sold for Rs. 10,50,000 on
4 - 1 - 2013 and its cost in 1982-83 was Rs. 90,000. He purchased a new
piece of land for his own cultivation for Rs. 2,60,000 in June, 2013. From
the above particulars, compute total income assuming that he has no
other income except these. Cost inflation index are : 1982-83 – 109,
1989-90 – 172, 1996-97 – 305, 2012-13 – 850 (assumed).
B) The following are the particulars of income of M as determined by the
Assessing Officer. Compute his total income for the assessment year 2013-14.
Brought forward losses of the assessment year 2012-13 12
Rs.
Loss from speculation business 1,40,000
Unabsorbed depreciation 14,000
Details of income for A.Y. 2013-14
Profit from speculation in commodities 2,80,000
Loss of hardware business 38,000
Profit from business of paints (before charging depreciation of Rs. 1,50,000) 84,000
Profit from business of tyres 2,24,000
Income from house property 38,000
————
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