Q1(a)Income Computation - Profit & Loss Analysis, House Property,
10 marks hard
The following is the Profit and Loss Account of Mr. Aditya, aged 55 years, a resident, for the year ended 31.03.2013:
Particulars: Rent 60,000 | Particulars: Gross Profit 1,85,000
Repair of car 3,000 | Gift of cash from a friend (received on 15.09.2012) 25,000
Wealth tax 5,000 | Sale of car 17,000
Medical expenses 4,500 | Interest on income-tax refund 3,000
Salary 18,000
Depreciation on car 3,600
Advance bonus 1,500
Net Profit 1,33,000
Total 2,30,000 | 2,30,000
Other information:
(1) Aditya bought a car during the year for ₹ 20,000. He charged depreciation @ 15% on the value of the car. The use of the car was 3/8 for business and 1/8 for personal use.
(2) Medical expenses were incurred for the treatment of Nikita, his wife.
(3) Salary had been paid on account of driver.
(4) Rent includes arrears of rent from April 12 to October 12 @ ₹ 5,000 p.m., paid in cash on 1.11.2012.
(5) Mr. Aditya had also let out a house property at a monthly rent of ₹ 25,000. The annual letting value is considered to be ₹ 2,50,000. The municipal taxes are ₹ 6,000, out of which ₹ 3,000 are paid by the tenant and ₹ 3,000 are yet to be paid by Mr. Aditya. Interest on the house property is ₹ 20,000.
(6) Mr. Aditya's minor daughter received ₹ 75,000 from stage acting. Interest on company deposits of Mr. Aditya's daughter (deposit was made out of income from stage acting) was ₹ 10,000.
(7) Aditya incurred an expense of ₹ 50,000 on the medical treatment of his dependent son, who has disability of more than 80%.
(8) Aditya had taken a loan during the year 2012-13 for the education of his son, who is pursuing B.Com. in Delhi University. Interest paid on the same during the year was ₹ 10,000.
Compute the total income of Mr. Aditya for the assessment year 2013-14.
Q2aHouse Property Income
8 marks very hard
Mr. Krishna owns a residential house in Delhi. The house is having two identical sets. First unit of the house is self-occupied by Mr. Krishna and another unit is rented for ₹ 12,000 p.m. The rented unit was vacant for three months during the year. The particulars of the house for the previous year 2013-14 are: Standard Rent: ₹ 2,50,000 p.a.; Municipal Valuation: ₹ 2,44,000 p.a.; Fair Rent: ₹ 2,35,000 p.a.; Municipal tax paid by Mr. Krishna: 12% of the Municipal Valuation; Light and water charges: ₹ 800 p.m.; Interest on borrowed capital: ₹ 2,000 p.m.; Insurance charges: ₹ 3,500 p.a.; Painting expenses: ₹ 15,000 p.a. Compute income from house property of Mr. Krishna for the assessment year 2013-14.
Q2b(i)Service Tax - Provider Obligations
4 marks medium
What will be the obligation of service provider in respect of excess service tax collected from the recipient under the service tax law?
Q2b(ii)Service Tax - Multiple Service Provider
0 marks easy
Can a multiple service provider use a single challan for payment of service tax for various services rendered by it?
Q3aSalary, Dearness allowance, Provident fund contribution
8 marks very hard
From the following details, find out the salary chargeable to cost of Mr. Anand for the assessment year 2013-14:
Mr. Anand is a regular employee of Malgoal Ltd. in Mumbai. He was appointed on 01-03-2012 in the scale of ₹ 5,000-2,500-35,000. He is paid dearness allowance (which forms part of salary for retirement benefits) @ 15% of basic salary and basic equivalent to one and a half times the scale at the end of the year. He contributes 18% of his salary (basic pay plus dearness allowance) towards recognised provident fund and the Company contributes the same amount.
Q3bService Tax Calculation
8 marks hard
Professionals Ltd. is engaged in providing services which became taxable with effect from 1st July 01, 2012. Compute the service tax payable by Professionals Ltd. on the following amounts (exclusive of service tax) received for the month of March, 2013: Services performed before such service became taxable (Invoice issued on 28th June, 2012): ₹ 5,00,000; Services by way of renting of residential dwelling for use as residence: ₹ 1,50,000; The services rendered to the friends of directors: ₹ 20,000; Advance received for services to be rendered in July, 2013: ₹ 5,00,000; Other receipts: ₹ 12,00,000. Rate of service tax is 12%; Education cess is 1%; Secondary & Higher Education cess is 1%.
Q3bService tax, Documentation requirements
4 marks medium
List out the documents to be submitted along with the first service tax return.
Q3cVAT Calculation
5 marks medium
Compute net VAT liability of Sachin from the following information: Raw materials from foreign market (includes duty paid on imports @ 20%): ₹ 1,20,000; Cost of raw material: ₹ 2,50,000; Add: Excise duty @ 12%: ₹ 30,000; Add: VAT @ 4%: ₹ 11,200; Raw materials purchased from neighbouring State (includes CST @ 2%): ₹ [amount]; Sorting and transportation cost: ₹ 9,000; Manufacturing expenses: ₹ 30,000. Sachin sold goods to Mohan and earned profit @ 12% on the cost of production. VAT rate on sale of goods is 4%. There is no opening or closing stock.
Q3cVAT, Composition scheme, Eligibility criteria
4 marks medium
What happens to VAT claim when a seller opts for composition scheme? What are the eligibilities for the composition scheme under the VAT regime?
Q4aCapital gains, Property valuation, Stamp duty
4 marks hard
Mr. Vaibhav sold a house, held as a capital asset, to his friend Mr. Dhanesh on 1st December, 2012 for a consideration of ₹ 25,00,000. The Sub-Registrar refused to register the document for the said value, as according to him, stamp duty valuation based on State Government guidelines was ₹ 45,00,000. Mr. Vaibhav preferred an appeal to the Revenue Divisional Officer, who fixed the value of the house at ₹ 35,00,000 (₹ 22,00,000 for building portion). The differential stamp duty was paid, accepting the said value. Mr. Vaibhav had purchased the land on 1st June, 2006 for ₹ 5,19,000 and completed the construction of the house on 1st October, 2010 for ₹ 14,00,000.
Q5State VAT, Input tax credit, Capital goods
4 marks medium
Mayak, a dealer, furnished the following details for the month of January, 2013:
Imports purchased within the State: ₹ 1,00,000
Finished goods sold within the State: ₹ 2,00,000
Goods sold in the course of inter-State trade: ₹ 1,00,000
Capital goods procured during the month: ₹ 1,00,000
VAT paid on capital goods: 12.5%
Input VAT rate: 12.5%
Output VAT rate: 4%
Central Sales Tax rate: 2%
Compute the total tax liability under the State VAT law.
Note: The capital goods are not goods included in the negative list. Input tax credit on capital goods is available in full in the year of purchase.
Q6(a)Income Tax - Total Income Computation
8 marks hard
Compute the total income of Mr. Krishna for the assessment year 2013-14 from the following particulars:
Income from business before adjusting the following items: ₹ 1,75,000
(a) Business loss brought forward from assessment year 2011-12: ₹ 70,000
(b) Current depreciation: ₹ 40,000
(c) Unabsorbed depreciation of earlier year: ₹ 1,55,000
Income from house property (Gross annual value): ₹ 4,32,000
Municipal taxes paid: ₹ 32,000
Mr. Krishna sold a plot of land in Noida on 12th Sep. 2012 for a consideration of ₹ 6,00,000, which had been purchased by him on 20th Dec. 2009 at a cost of ₹ 4,10,000.
Long-term capital loss on sale of shares sold through recognized stock exchange (STT paid): ₹ 75,000
Long-term capital gain on sale of debentures: ₹ 60,000
Dividend on shares held as stock in trade: ₹ 22,000
Dividend from a company carrying on agri business: ₹ 10,000
Q7(a)Income Tax - Definition of Assessee
4 marks medium
Define the term 'assessee' as per the Income Tax Act, 1961.
Q7(b)Income Tax - Business Income, SEZ, DTA
8 marks very hard
Case: Mr. Premy is running two industrial undertakings, one in a SEZ (Unit A) and another in a DTA (Unit B). The brief details for the year ended 31.03.2013 are provided.
Mr. Premy is running two industrial undertakings, one in a SEZ (Unit A) and another in a DTA (Unit B). The brief details for the year ended 31.03.2013 are as under:
Particulars | Unit A (₹ in lacs) | Unit B (₹ in lacs)
Domestic turnover | 10 | 100
Export turnover | 120 | Nil
Gross Profit | 20 | 10
Less: Expenses and depreciation | 07 | 06
Profits derived from the units | 13 | 5
The brought forward business loss belonging to assessment year 2010-11 for Unit B is 3.2 lakhs. Briefly compute the business income of the assessees.
Q9(d)VAT - Value Added Tax
4 marks medium
Fill up the blanks for the following items in the context of VAT:
(i) The most commonly used method for computing VAT is the _____ method.
(ii) The most widely used variant among the various ones is the _____ variant.
(iii) When a dealer opts for Composition Scheme, the VAT chain _____ (continues/gets broken)
(iv) Among the following is not an applicable VAT rate: 0, 5, 8, 12
Q10(b)Charitable Services, VAT/Tax
4 marks medium
In the context of charitable services, what are the implications of the term 'provided or supplied'?
Q10(c)VAT - Input Tax Credit
4 marks medium
List the purchases which are not eligible for input tax credit under VAT legislation.
Q11Charitable trust conditions under section 12A, Income Tax Ac
4 marks medium
What are the conditions to be fulfilled by a charitable trust under section 12A for applicability of exemption provisions contained in section 11 and 12 of the Income-tax Act, 1961?
Q11Service tax valuation when consideration is mixed
4 marks medium
Describe briefly the manner of determination of value for service tax purposes, when consideration is not wholly/partly consisting of money.
Q11VAT system deficiencies
4 marks medium
What are the deficiencies of VAT system?