Dibrugarh University B.Com Fifth Sem: Direct Tax - I Question Papers (Nov' 2018)

[Direct Tax I Question Paper 2013, Dibrugarh University, B.Com 5th Sem, Non CBCS Pattern]

Course: 504
(Direct Tax - I)
The figures in the margin indicate full marks for the questions
Full Marks: 80
Pass Marks: 24
Time: 3 hours
1. (a) Write True or False:         1x4=4

1)         The total income of individual leaving India up to the date of his departure shall be chargeable to tax in that assessment year.
2)         Scholarship received by students must be financed by the government.
3)         Any income received by any person for or on behalf of the New Pension System Trust (established on February 27, 2008) will not be chargeable to tax.
4)         Interest on borrowed capital is allowable as deduction if capital is borrowed for the purpose of purchase, construction, repair, renewal, etc.
(b) Choose the correct answer of the following:                                      1x4=4
1)         The contribution made by the Central Government in the previous year, to the account of an employee under a pension scheme referred to in
a)      Section 80C.
b)      Section 80CCC.
c)       Section 80CCD
2)         Where an assessee uses his property for carrying on any business or profession, no income is chargeable to tax under the head
a)      Income from Salaries.
b)      Income from House Property.
c)       Income from Other Sources.
3)         The Appellate Tribunal, constituted by the Central Government, functions under the Ministry of Law, consists of which of the following two classes of members?
a)      Judicial and accountant.
b)      Commissioners and accountant.
c)       Inspector of income tax and accountant.
4)         Statutory Provident Fund is set up under the provisions of the
a)      Provident Fund Act, 1952
b)      Provident Fund Act, 1925
c)       Income-tax Act, 1961
2. Write short notes on any four of the following:                               4x4=16
a)         Charge of Income Tax.
b)         Entertainment Allowance.
c)          Approved Superannuation Fund.
d)         Unrealized Rent.
e)         Commission of Income Tax.
3. (a) “Appeal against the order of the Assessing Office lies with the Commissioner (Appeals).” Do you agree? Write an explanatory note in support of the above statement.            14
(b) Mention any fourteen such incomes that are absolutely exempt from income tax under Section 10 of the Income-tax Act, 1961.           14
4. (a) Shri Uttom, is an employee of an Guwahati-based company. He provides the following particulars of his salary income:                                                             14
1)         Basic salary – Rs. 50,000 per month.
2)         Dearness allowance – Rs. 12,500 per month (40 per cent of which is include for the purpose of determining retirement benefit).
3)         Bonus – Rs. 25,000.
4)         Transport allowance – Rs. 7,600 p.m. (out of which Rs. 1,600 is used for the journey between office and residence, remaining amount is not spent).
5)         He contributes 15% of basic salary towards RPF and the company also makes a matching contribution.
6)         Interest credited to RPF @ 12% is Rs. 30,000.
7)         Reimbursement of medical bills Rs. 60,000 out of this Rs. 20,000 is in respect of medical bill of his wife and she got her medical treatment from government hospital.
8)         Leave encashment Rs. 30,000. It relates to encashment of current year’s leave.
9)         He has been provided with a rent free house hired by employer at Rs. 15,000 p.m.
10)      He paid Rs. 3,000 as professional tax.
Compute Shri Uttom income under the head Income from Salaries for the Assessment year, 2018 – 19.                                
(b) What do you mean by the term ‘perquisites’ under the head salary? What are the classifications of perquisites? Explain briefly the perquisites which are not taxable.         3+2+9=14
5. (a) Mr. Swadhin owns resident house properties. Following are the particulars of two house properties owned by him:

House – I
House – II
Municipal valuation (in Rs.)
Fair rent (in Rs.)
Standard rent (in Rs.)
Actual rent received (in Rs.)

Let out

Municipal taxes:
Due (in Rs.)
Paid (in Rs.)

Interest on borrowed money (in Rs.)
9,000 p.m.
01.04.2017 to



10,000 p.m.



Loan taken to construct House – II is still outstanding. Loan was taken in 1998.
Find out the income from house properties of Swadhin for the Assessment Year, 2018-19.           14
(b) Explain how to compute income from self-occupied house property. Write a note on special provisions with regard to unrealized rent when it is realized subsequently.        10+4=14
6. (a) Write a note on Central Board of Direct Taxes. Explain the powers of Assessing Officers.   4+10=14
(b) What do you mean by ‘right to appeal’? What are the procedures in appeal? Explain in detail.    4+10=14
Full Marks: 80
Pass Marks: 32
Time: 3 hours
1. (a) Write True or False:                               1x4=4
1)         A company shall be ‘non-resident’ if its place of effective management is situated wholly or partially outside India during the relevant accounting year.
2)         Statutory Provident Fund is set up under the provision of the Provident Fund Act, 1952.
3)         Any income derived by the SAARC fund for regional project is exempt from tax.
4)         Income is taxable under the head Income from House Property only if the assessee is not the owner of a house property.
(b) Choose the correct answer of the following:       1x4=4
1)         One can deposit in Public Provident Fund subject to
a)      Minimum Rs. 500 and maximum Rs. 1,50,000 per annum.
b)      Minimum Rs. 600 and maximum Rs. 2,00,000 per annum.
c)       Minimum Rs. 700 and maximum Rs. 2,50,000 per annum.
2)         Example of an Association of Persons (AoP) is
a)      A village Panchayat.
b)      Mark fed.
c)       Reliance Industries Limited.
3)         Pankaj is entitled to hostel allowance @ Rs. 500 p.m. per child for 3 children. It will be exempted to the extent of
a)      Rs. 7,200.
b)      Rs. 12,000.
c)       Rs. 16,400.
4)         Underground allowance granted to an employee who is working in uncongenial, unnatural climate in underground mines is exempted to the limit of
a)      Rs. 1,000 per month.
b)      Rs. 800 per month.
c)       Rs. 600 per month.
2. Write short notes on any four of the following:            4x4=16
a)         Income.
b)         Annuity.
c)          Deemed Income.
d)         Recognized Provident Fund.
e)         Municipal Rental Value.
f)          Income-tax Act, 1961.
3. (a) Explain in detail any twelve incomes which are exempted under Section 10 of the Income-tax Act, 1961.    12
(b) “Income received in India is taxable in all cases irrespective of residential status of the assessee.” Explain the statement in detail.                                                        12
4. (a) “Income-tax concession is given to newly established units in special economic zone.” Explain this statement.     11
(b) Write brief notes on the following:                          5.5+5.5=11
1)         Income which are not included in the total income.
2)         Tax holiday for industrial units in trade zones.
5. (a) From the following information compute the taxable income from salary of Shri Kamal Deka for the Assessment Year, 2018 – 19:           11
1)         Basic salary – Rs. 3,60,000 p.a. 
2)         Dearness allowance – Rs. 36,000 (25% enters for retirement benefit)
3)         Education allowance for two children at Rs. 350 per month per child and hostel allowance for two children at Rs. 450 per month per child.
4)         Commission received on turnover – Rs. 50,000.
5)         Special allowance Rs. 3,000 per month.
6)         Entertainment allowance @ Rs. 10,000 per annum.
7)         He is provided with a rent-free house hired by employer at Rs. 10,000 per month.
8)         He is provided with a car of 1.8 litre capacity (with driver) for both official and personal purposes.
9)         He receives Rs. 20,000 as leave travel concession but has not travels anywhere.
10)     Professional tax paid by him – Rs. 250 per month.
Compute the taxable income from salary of Shri Kamal Deka for the Assessment Year, 2018-19.
(b) In order to encourage savings for the social security of employees, government has set up various kinds of provident funds.
In the light of the above statement, explain the following:                  5.5+5.5=11
1)         Recognized Provident Fund.
2)         Unrecognized Provident Fund.
6. (a) Mohan is a manager (finance) in Reliance Ltd., Mumbai and gets Rs. 34,000 per month as salary. He owns two houses one of which is let out to the employer-company which in turn provided the same to Mohan as rent-free accommodation. Determine the net income of Mohan for the Assessment Year, 2018-19 taking into account the following information relating property income:   11

House – I
House – II
Fair rent (FR) (in Rs.)
Annual rent (in Rs.)
Municipal valuation (MV) (in Rs.)
Standard rent
Municipal taxes paid (in Rs.)
Repairs (in Rs.)
Insurance (in Rs.)
Land revenue (in Rs.)
Ground rent (in Rs.)
Interest on capital borrowed by mortgaging House – I (funds are used for construction of House – II) (in Rs.)
Unrealized rent of the previous year, 2003 – 04 (in Rs.)
Unrealized rent of 2017-18 (in Rs.)
Nature of occupation

Date of completion of construction

Let out to

March 1999


Let out to
Rohan for

April 2001

(b) Explain the procedure of computation of gross annual value in the case of self-occupied house property. 11
7. (a) What is the role of commissioner of income tax? Explain the powers which are entrusted to him by Central Board of Direct Taxes.                    11
(b) Write notes on the following:                     5.5+5.5=11
1)         Central Board of Direct Taxes.
2)         Commissioner of Income Tax.


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