Dibrugarh University Question Papers: Income Tax (May' 2016)

2016 (May)
Course: 601
(Income Tax)
Full Marks: 80
Pass Marks: 32
Time: 3 hours
The figures in the margin indicate full marks for the questions

1. (a) Write ‘True’ or ‘False’:                                        1x4=4
a)      Income Tax is calculated on the basis of residential status of assessee.
b)      Salary is taxable on due basis or on receipt basis, whichever is earlier.
c)       House or property used by the political party is exempted from House Property Tax.
d)      An Income Tax Inspector is appointed by the Central Government.

(b) Fill in the blanks:                                                    1x4=4
a)      According to Income-Tax Act, 1961, the ____ is that year in which year income is earned to be taxable in the next year.
b)      Gross total income of an assessee consists of income from salaries, income from house property, profits and gains of business or professions, capital gains and from ____.
c)       As per the Income Tax Act, 1961, agriculture income in India is ____ to tax.
d)      ____ arises from the transfer of any capital asset.

2. Write short notes on any four of the following:                                             4x4=16
a)      Assessee.

b)      Agricultural Income.
c)       Person (as per Income-tax Act, 1961).
d)      Income exempted from Income-tax Act.
e)      Tax evasion and its penalties.

3. (a) From the following information of Mr. Ashok, compute his taxable income for the assessment year, 2015-16: 14
a)      Basic salary @ Rs. 20,000 p.m.
b)      Arrears of salary Rs. 10,000.
c)       Dearness allowance @ Rs. 8,000 p.m.
d)      Employer is paying insurance premium of Rs. 20,000 p.a. on his life.
e)      Bonus Rs. 30,000.
f)       Education allowance for his two children @ Rs. 600 p.m.
g)      Cash gift Rs. 40,000.
h)      City compensatory allowance @ Rs. 2,000 p.m.
i)        Medical expenses paid by employer Rs. 18,000.
j)        He contributes 15% of his salary to a recognized provident fund and his employer also contributes the same.
k)      He is provided with a mobile phone, the bill of which is paid by the company Rs. 6,000.
l)        He is given lunch allowance @ Rs. 100 per day for 250 days during the previous year.


(b) Explain how the following items are treated under Income-tax Act, 1961:
a)      Gratuity.
b)      House rent allowance.
c)       Residential accommodation provided by employer.
d)      Encashment of earned leave.

4. (a) Mr. Bimal owns a residential house property. It has two equal residential units, Unit – I and Unit – II. While  Unit – I is self-occupied by Mr. Bimal for his residential purpose, Unit – II is let out (rent being Rs. 6,000 per month, rent of two months could not be recovered). Municipal value of the property is Rs. 1,30,000, standard rent is Rs. 1,25,000 and fair rent is Rs. 1,40,000. Municipal tax is imposed @ 15% which is paid by Mr. Bimal. Other expenses for the previous year 2014 – 15 being repairs Rs. 800, insurance Rs. 1,500, interest on capital for constructing the property Rs. 63,000.  Compute the house property income of Mr. Bimal for the assessment year 2015-16.                14


(b) (i) Distinguish: Annual value and Annual rental value.
(ii) How would you determine the annual value of let-out house and self-occupied house (as per Income-tax Act, 1961)                                7+7=14

5. (a) What do you mean by “Tax Holiday” in a trade zone? Write a note on industries which are under the preview of Tax Holiday Scheme in the North-Eastern Region.                         5+9=14


(b) What do you mean by Special Economic Zone? State 10 incomes which are not form a part of total income (as per Section 10 of the Income-tax Act, 1961).

6. (a) What are the legal provisions to be made in computing taxable income from income from capital gain? How are taxes chargeable in short-term capital assets and long-term capital assets?                                                      8+6=14


(b) Write short notes on:                                          3 ½ x4=14
a)      Income from other sources.
b)      Deemed income and Deemed ownership.
c)       Tax deducted at source.

d)      Central Board of Direct Taxes (CBDT)