Q1Total income computation with tax audit adjustments
15 marks very hard
Mr. Kamal, a resident and ordinarily resident aged 58 years, is engaged in the business of manufacturing steel. He is subject to tax audit under section 44AB of Income-tax Act, 1961. Based on his Profit & Loss account for year ended 31st March 2025, and additional information regarding stock valuation, salaries including pension contributions, interest on personal car loan, depreciation adjustments, scientific research asset loss, and compulsory acquisition of industrial land with reinvestment and interest received, compute the total income and tax liability of Mr. Kamal for the assessment year 2025-26 assuming he has opted out of section 115BAC.
Q1GST reverse charge on GTA services
2 marks hard
Case: Jyoti Transport Co., a Goods Transport Agency, is registered under GST. It did not exercise the option to pay GST itself on the services supplied by it in the preceding financial year. It provided goods transport services to: (a) Gaurav Traders, an unregistered partnership firm; (b) Mr. Amar, a casual taxable person, not registered under GST; (c) Vyapar Mandal Co-Operative Society registered under Societies Registration Act. In March of preceding financial year, Jyoti transported: (a) Defence Equipments; (b) Railway Equipments; (c) Organic Manure. From April current financial year, Jyoti exerc…
Which of the following persons are liable to pay GST under reverse charge in respect of the GTA services provided by Jyoti Transport Co. in February of the preceding financial year?
(a) i & ii
(b) ii & iii
(c) i & iii
(d) i, ii & iii
Q1(a)GST computation on machinery supply with subsidies
10 marks hard
Resty Ltd., Delhi, a registered supplier, manufacturing machineries has made a taxable supply of machinery during the month of March. Resty furnished details for each such machinery supplied including list price of machinery (` 10,00,000 exclusive of taxes), subsidy received from Central Government for supply to Government School (` 2,10,000), subsidy received from an NGO for supply to old age home (` 2,00,000), tax levied by Municipal Authority (` 2,50,000), and packing charges (` 1,25,000). The list price is after considering the two subsidies received. Other charges/taxes/fee are charged to customers over and above the list price. Resty also provided information pertaining to purchases made/services availed during March: Raw material (to be received in April) with GST ` 8,50,000; Club membership for employees with GST ` 4,00,000; Inputs to be received in 6 lots (1st lot received) with GST ` 3,50,000; Trucks for transport with GST ` 1,50,000; Capital goods with GST ` 3,50,000 (2 invoices missing, GST paid ` 2,82,000). Compute the net GST payable in cash by Resty Ltd. for the month of March.
Q1(b)Input tax credit availability analysis
5 marks medium
Punto Ltd. procured the following goods in the month of January: Goods used in constructing an additional floor of office building (cost capitalized) with GST ` 96,200; Trucks used for transportation of inputs in factory with GST ` 11,000; Inputs used in trial runs with GST ` 8,350; Confectionery items for consumption of employees working in factory with GST ` 4,325; Cement used for making foundation and structural support to plant and machinery with GST ` 9,550. Compute the amount of ITC available with Punto Ltd. for the month of January by giving necessary explanations. Assume that all other conditions necessary for availing ITC have been fulfilled. Note: Depreciation has not been claimed on tax component in case of trucks.
Q1(i)Interest deduction on housing loan under section 24(b)
2 marks hard
Case: Mr. Rohan Mehta, aged 45 years, a resident individual, is a retail trader. He is an eligible assessee under section 44AD of the Income-tax Act, 1961 and follows the mercantile system of accounting. For the financial year 2024-25, his total turnover amounts to ` 130 lakhs. The breakup of turnover and mode of receipts are: ` 25 lakhs received by account payee cheque during the previous year; ` 50 lakhs received by cash during the previous year; ` 25 lakhs received by account payee bank draft before the due date of filing of return under section 139(1); ` 30 lakhs not received till the due date o…
The amount of interest deduction u/s 24(b) for A.Y. 2025-26, if he has exercised the option of shifting out of the default regime provided under section 115BAC(1A), is
(a) ` 1,50,000
(b) ` 1,80,000
(c) ` 2,00,000
(d) ` 2,10,000
Q1(ii)Deemed profits under section 44AD
2 marks hard
Case: Mr. Rohan Mehta case scenario (as above)
What shall be the amount of deemed profits of Mr. Rohan under section 44AD(1) for A.Y. 2025-26?
(a) ` 10.40 lakhs
(b) ` 7 lakhs
(c) ` 5.50 lakhs
(d) ` 9.40 lakhs
Q1(iii)Capital gains taxation on agricultural land
2 marks hard
Case: Mr. Rohan Mehta case scenario (as above)
What would be the amount of capital gain chargeable to tax in the hands of Mr. Rohan for the A.Y. 2025-26?
(a) Short-term capital gain of ` 9.75 lakhs
(b) Short-term capital gain of ` 7 lakhs
(c) Long-term capital gain of ` 2,72,212
(d) Long-term capital gain of ` 2,50,158
Q2GST exemption on transportation services
2 marks hard
Case: Jyoti Transport Co. case scenario (as above)
Transportation of _________ by Jyoti Transport Co. is exempt from GST.
(a) i
(b) i & ii
(c) i & iii
(d) i , ii & iii
Q2(a)Residential status determination and income computation
6 marks medium
Determine the residential status and total income of Mr. Arvind under optional tax regime for the A.Y.2025-26. Mr. Arvind, aged 62, is a Canadian citizen employed in senior research position with multinational corporation based in Gurugram since 2009. He traveled to USA, UK, and Germany during FY 2024-25 while remaining based at Gurugram office. He was present in India for 380 days during last 4 years preceding P.Y. 2024-25 and 700 days during last 7 years preceding P.Y. 2024-25. Income earned during P.Y 2024-25: Salary of ` 15,80,000 credited to Indian bank account; Dividend of ` 48,000 from Singapore company deposited in Singapore bank account; Interest income of ` 10,500 credited to Punjab National Bank.
Q2(a)GST taxability of various services
4 marks medium
Comment on the taxability or otherwise of the following transactions under GST law. Also state the correct legal provisions for the same.
Q2(b)Tax deducted at source implications
4 marks medium
Examine TDS implications in case of following transactions, briefly explaining provisions involved; state the rate and amount to be deducted, assuming that the deductees are residents and having a PAN which they have duly furnished to the respective deductors.
Q2(b)Time of supply for reverse charge goods
6 marks medium
Determine the time of supply from the given information in each of the following independent cases
Q2(i)Interest income from gifted amounts
2 marks hard
Case: Mr. Mahesh Verma, aged 64 years, is a resident individual running a small trading business. On 1st April 2021, he gifts ` 3,00,000 to his wife, Nisha, and ` 2,00,000 to his daughter, Ria (20 years old). Both invest the gifted amounts in Government of India 11% Taxable Bonds with automatic reinvestment. In FY 2024-25, Mahesh has interest income from savings bank account (` 20,000), fixed deposit (` 25,000), and recurring deposit (` 10,000) with an NBFC. During scrutiny assessment, undisclosed investments of ` 7,00,000 are discovered without satisfactory explanation.
What is the amount of interest taxable in hands of Nisha for A.Y. 2025-26?
(a) ` 4,473
(b) ` 12,132
(c) ` 33,000
(d) ` 36,630
Q2(ii)Deemed income under section 69
2 marks hard
Case: Mr. Mahesh Verma case scenario (as above)
Determine the amount of tax payable by Mahesh on the value of investments considered to be deemed income as per section 69?
(a) ` 2,18,400
(b) ` 55,000
(c) ` 5,46,000
(d) ` 54,600
Q2(iii)Chapter VI-A deductions outside default regime
2 marks hard
Case: Mr. Mahesh Verma case scenario (as above)
What would be the deduction allowable to Mr. Mahesh under Chapter VI-A if he has exercised the option of shifting out of the default regime provided under section 115BAC(1A) for the A.Y. 2025-26?
(a) ` 55,000
(b) ` 10,000
(c) ` 20,000
(d) ` 50,000
Q3Dividend income and investment loan interest
2 marks easy
Mr. X, aged 61 years, earned dividend of ` 12,00,000 from ABC Ltd. in P.Y. 2024-25. Interest on loan taken for the purpose of investment in ABC Ltd., is ` 3,00,000. Income included in the hands of Mr. X for P.Y. 2024-25 would be
(a) ` 12,00,000
(b) ` 9,60,000
(c) ` 9,00,000
(d) ` 2,00,000
Q3Time of supply for services
2 marks hard
Case: Jyoti Transport Co. case scenario (as above)
What will be the time of supply in respect of the services provided by Jyoti Transport Co. to Rathi Industries Pvt. Ltd.?
(a) 6th May
(b) 5th May
(c) 30th May
(d) 1st April
Q3(a)HRA vs rent-free accommodation comparison
6 marks medium
Mr. Krishna, aged 38 years, is entitled to a salary of ` 40,000 per month. He is given an option by his employer either to take house rent allowance of ` 8,000 per month or a rent free accommodation which is owned by the company. The monthly rent for the hired accommodation is ` 6,500. Advice Mr. Krishna whether it would be beneficial for him to avail HRA or Rent Free Accommodation on the basis of 'Net Take Home Cash benefits'. Assume Mr. Krishna opts out from the provisions of section 115BAC.
Q3(a)GST registration threshold and applicability
5 marks medium
Examine whether the supplier of goods is liable to get registered in the following independent cases
Q3(b)Capital gains and trust distributions
4 marks medium
Examine the following transactions in the context of Income-tax Act, 1961
Q3(b)Tax invoice issuance on sale or return basis
5 marks medium
M/s. Virtus Trans of Kolkata is engaged in the trading of transmitters. On 20th May, M/s. Virtus Trans has sent 500 units of transmitters for exhibition at Chennai on sale or return basis. Out of the said 500 units, 300 units have been sold on 28th August at the exhibition. Out of remaining 200 units, 150 units have been brought back to Kolkata on 25th November and balance 50 units have neither been sold nor brought back. Explain the provisions under GST law relating to issue of invoices with exact dates on which tax invoices need to be issued by M/s. Virtus Trans.
Q4Section 80G deduction on charitable donations
1 marks easy
Mr. Shivam made a donation of ` 50,000 to PM Cares Fund and ` 20,000 to Prime Minister's Drought Relief Fund. He made a cash donation of ` 10,000 to a public charitable trust registered under section 80G. The deduction allowable to him under section 80G for A.Y.2025-26 is
(a) ` 80,000
(b) ` 70,000
(c) ` 60,000
(d) ` 35,000
Q4GST registration effective date
2 marks hard
Case: Anjani was engaged in providing various services within the State of Rajasthan since April. His Aggregate turnover crossed the threshold limit on 04th June. He applied for registration under GST on 2nd July. He got his GST registration on 10th July. After taking registration, Anjani started a business across India including supply of goods. He received an order from Delhi for which he supplied taxable goods valuing ` 45,000 (IGST @ 12%) and exempted goods valuing ` 4,000 in one invoice. While shutting down his business, he informed tax consultant to cancel the GST registration. The tax consult…
Effective date of registration of Anjani is ____________.
(a) 04th June
(b) 02nd July
(c) 03rd July
(d) 10th July
Q4(a)Income computation with multiple income sources
6 marks medium
Mr. Sanjeev, aged 30 years, submits information of multiple transactions and income sources during P.Y. 2024-25, including: transfer of house to family member with rental income split condition, partnership firm fixed deposit with reinvested interest, dividend transfer to servant's daughter, capital gains/losses, and miscellaneous income including betting and card games. Compute the total income of Mr. Sanjeev for the A.Y.2025-26 and the losses to be carried forward assuming he opts out from default regime under section 115BAC.
Q4(a)Post-supply discounts and supply value
5 marks medium
Are post-supply discounts eligible for deduction from the value of supplies in all situations? Explain.
Q4(a)-altPlace of supply for mobile services
5 marks medium
What is the place of supply for mobile connection? Can it be the location of supplier?
Q4(b)Aadhar number intimation consequences
4 marks medium
What are the consequences of failure to intimate Aadhar Number. Is there any fee for such default?
Q4(b)GSTP registration eligibility criteria
5 marks medium
Who can be registered as Goods and Service Tax Practitioners under Section 48 of the CGST Act, 2017?
Q4(b)-altAdvance tax on capital gains and casual income
4 marks medium
Briefly discuss the provisions relating to payment of advance tax on income arising from capital gains and casual income.
Q5Consignment value calculation for e-way bill
2 marks hard
Case: Anjani case scenario (as above)
Consignment value of goods supplied to Delhi by Anjani is `___________.
(a) 45,000
(b) 49,000
(c) 50,400
(d) 54,400
Q6Final return filing deadline after GST cancellation
2 marks hard
Case: Anjani case scenario (as above)
Due date by which Anjani is supposed to file Final return under GST is ____________.
(a) 25th October
(b) 30th October
(c) 25th December
(d) 31st December
Q7E-way bill validity period
2 marks easy
Udit Associates, Delhi dealing in garments has ordered ladies suits from Pakiza Garments in Ludhiana (Punjab) which is 350 km away from its warehouse. E-way bill is generated by Sahiba Garments and the order is coming by a normal cargo. For how many days will the e-way bill be valid from the time it is generated?
(a) 24 hours
(b) 2 days
(c) 5 days
(d) 7 days
Q8GST applicability on residential property rental
1 marks easy
Harjeet Kaur, a resident of Punjab, is having a residential property in Amritsar, Punjab which has been given on rent to a family for ` 72 lakh per annum for residence purposes. Determine whether Harjeet Kaur is liable to pay GST on such rent.
(a) Yes, as services by way of renting is taxable supply under GST.
(b) No, service by way of renting of residential property is exempt.
(c) No, service by way of renting of residential property does not constitute supply.
(d) Harjeet Kaur, being individual, is not liable to pay GST.