2017
DIRECT TAXES
Full Marks: 80
Time: 3 hours
(The figures in the margin indicate full marks for the questions)
1. (a) State whether the statements are True or False: 1x5=5
1) An Indian citizen is always considered as ‘resident and ordinarily resident’ in India.
2) If a company is incorporated in India, it is considered as resident in India.
3) Income of all private Nursing Homes is exempted from Income Tax.
4) All types of companies are liable to pay wealth tax.
5) In India, Wealth Tax Act of 1957 has been made effective from 1st April, 1956.
(b) Fill in the blanks with appropriate word: 1x5=5
1) The present Income Tax Act came into force with effect from _______, _______.
2) Rent of agricultural lands is _______ income.
3) _______ of an assessee has no relation with the concept of residential status.
4) Perquisites _______ be given in monetary form.
5) Interest on capital received by a partner of a farm engaged in agricultural operation is _______ income.
2. Write short answers to the following in about 50 words each: 2x5=10
a) State the meaning of ‘Previous year’ as per the Income Tax Act.
b) State the meaning of ‘Perquisite’ as per Income Tax Act.
c) Who is a ‘Resident but not ordinarily resident’ individual?
d) Define ‘Net Wealth’ under the Wealth Tax Act.
e) Mention two specific incomes under the head ‘Income from other sources’.
3. Describe briefly any four of the following: 5x4=20
a) Explain the meaning of ‘Short-term capital gain’.
b) How is the ‘residential’ status of a company determined?
c) Mention the items of General Income under the head ‘Income from other Sources’.
d) What is Annual value of a house property under Income Tax Act?
e) What are the various modes of assessment of Income tax as per Income Tax Act, 1961?
f) Define ‘Agricultural Income’. Give examples of incomes which are related to land, but are not agricultural income.
4. Answer any four from the following: 10x4=40
(a) Mr. Hazarika is employed in a private limited company in Guwahati. During the previous year 2015-16, he received the following payments from his employer:
| | Rs. |
| 1) Basic salary 2) Dearness allowance 3) Entertainment allowance 4) Servant allowance 5) Bonus for the year 6) Commission received 7) Free furnished accommodation to him for which the employer, paid a rent of 7,000 p.m. 8) Employer’s contribution to Recognized Provident Fund @ 13% p.a. on basic. 9) During the year (previous) his employer deduction Rs. 2,800 as Professional tax from his salary. | 25,000 p.m. 20,000 p.m. 3,000 p.m. 1,000 p.m. 1,00,000 50,000 |
Compute his income from salary for the relevant assessment year.
(b) Mr. Rajib Sharma is the owner of a house property in Tinsukia. The house is let out at a rent of Rs. 20,000 p.m. Its municipal valuation is Rs. 1,80,000 p.a. and standard rent is Rs. 2,10,000 p.a. The fair rent of the house is Rs. 2,20,000. The house remained vacant for one month and rent for two months is outstanding and there is no chance of its recovery as per rules.
Municipal tax paid by the tenant Rs. 8,000 and by the owner Rs. 6,000.
Compute the Net Annual Value for the assessment year 2015-16.
(c) What is meant by ‘Assessment of Income’? State the procedure of filing of return by an individual assessee.
(d) Define ‘asset’ as per Wealth Tax Act, 1957. Explain the items of assets included for ascertaining the net wealth of a person.
(e) Write short notes on:
1) House rent allowance.
2) Medical facility.
(f) State the deductions available from Gross Total Income under Section 80C of Income Tax Act, 1961.
(g) Describe briefly the procedure of ascertaining the income under the head “Profits and gains of business or profession.”
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