Dibrugarh University B.Com 6th Sem: Income Tax Question Papers (May'2019)

Course: 601
(Income Tax)
Time: 3 hours
The figures in the margin indicate full marks for the questions
Full Marks: 80
Pass Marks: 24
1. (a) Write True or False:                   1x4=4

1)         The residential status of an assessee may change from year to year.
2)         Any amount withdrawn from the Statutory Provident Fund is exempt from tax.
3)         Entertainment allowance is fully taxable irrespective of any expenditure incurred on entertainment of guests or customers.
4)         House Property Income = Annual Value of Building – Specified deductions u/s 22.
(b) Fill in the blanks:                   1x4=4
1)         The income tax was introduced in India for the first time in _______ by British rulers.
2)         Under Section _______, the full amount of scholarship granted to meet the cost of education is exempted.
3)         The value of perquisites is chargeable to tax under the head _______.
4)         Income from house property held by a local authority shall be _______.
2. Write short notes on any four of the following:   4x4=16
a)         Person [Section 2(31)]
b)         Special Economic Zone.
c)          Profit in lieu of Salary [Section17(3)]
d)         Deemed Owner of House Property.
e)         Self-occupied Property.
3. (a) Define the terms ‘previous year’ and ‘assessment year’. What are the exceptions to the rule that income of a previous year is assessed to tax in the assessment year?         5+5+4=14
(b) “The incidence of income tax depends upon the residential status of an assessee.” Explain this statement in detail.  14
4. (a) What do you mean by tax-free income? Discuss any twelve incomes which are neither included in total income nor income tax is payable on them.                        2+12=14
(b) Explain the following:                               7+7=14
1)         Tax exemption for 100% export-oriented units.
2)         Tax holiday in respect of free trade zones.
5. (a) Mr. X is a production manager of an industrial unit at Chennai. The particulars of his salary income are as under:
1)         Basic salary – Rs. 40,000 p.m.
2)         Dearness allowance (given under the terms of employment) – Rs. 15,000 p.m.
3)         Entertainment allowance – Rs. 1,000 p.m.
4)         Medical allowance – Rs. 500 p.m.
5)         House rent allowance – Rs. 12,000 p.m.
6)         Rent paid for the house – Rs. 15,000 p.m.
7)         Car of 1.2 liters capacity provided by employer for private and official use. Employer meets expenses of car.
8)         He and his employer (each) contribute 13% of salary to Recognized Provident Fund.
9)         Mr. X had taken interest-free loan of Rs. 15,000 to purchase a refrigerator.
Compute income under the head salary for the Assessment Year, 2018-19.                              14
(b) Explain in brief the following items as per the Income-tax Act, 1961:     3.5x4=14
1)         Statutory Provident Fund.
2)         House Rent Allowance.
3)         Perquisites.
4)         Leave Travel concession.
6. (a) Who are the persons liable to pay tax on income from house property? Explain briefly the different types of incomes from house property not chargeable to tax.         4+10=14
(b) Following are the particulars of two house properties owned by Mr. Ghanshyam:

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 (in Rs.)
Interest on borrowed money (in Rs.)
9,000 p.m.
01.04.2018 to

01.12.2018 to

10,000 p.m.
01.12.2018 to

01.04.2018 to

Loan taken to construct House – II is still outstanding Loan was taken in 1998.
Find out Mr. Ghanshyam income from house property for the Assessment Year, 2018-19.            14
Full Marks: 80
Pass Marks: 32
1. (a) Write True or False:                   1x4=4
1)         Income-tax Act, 1961 came into force from April 1, 1962 in whole of the country.
2)         Agricultural income from land situated in India is fully taxable.
3)         Recognized Provident Fund was started in the year 1925.
4)         Bank interest is an example of taxable interest u/s 56(1) of the Income-tax Act, 1961.
(b) Fill in the blanks:                1x4=4
1)         If an HUF is controlled from India even partially, it will be _______ assessee.
2)         Unrecognized Provident Fund is that fund which is not recognized by the _______ of Income tax.
3)         The rent fixed under the Rent Control Act where so ever applicable is called _______ rent.
4)         An income under the head capital gain to a registered Trade Union is _______.
2. Write short notes on any four of the following:                4x4=16
a)         Assessee.
b)         Free Trade Zone.
c)          Gratuity.
d)         Municipal Value.
e)         Capital Assets.
3. (a) Write a note on history of income tax in India.                        12
(b) What are the different categories of assessee according to their residential status? How would you determine the status of an individual and a firm?                        4+8=12
4. (a) Explain in brief at least fifteen incomes which are exempted u/s 10 of the Income-tax Act, 1961.                    11
(b) Explain the following:              5.5x2=11                
1)         Tax holiday for export-oriented undertakings.
2)         Tax holiday for newly established units in Special Economic Zones.
5. (a) Mrs. Shilpa is employed in HL Ltd. as marketing officer at Vijayawada. She resigned from the job on 31.07.2017. Her salary particulars are as follows:
Conveyance allowance
Rs. 25,000 p.m.
Rs. 12,500 p.m.
Rs. 500 p.m.
Rs. 1,000 p.m.
She claims to have spent 75% of this in the performance of her duties.
From 01.08.2017, she joined XYZ Ltd. in Hyderabad. Her salary particulars from her new employer are as follows:
Rs. 27,000 p.m.
Rs. 13,500 p.m.
Rs. 700 p.m.
Rs. 8,000 p.m. (she pays Rs. 12,000 p.m. as rent
She and her employer both were contributing @ 14% of salary towards Recognized Provident Fund.
Compute the salary income of Mrs. Shilpa for the Assessment Year, 2018-19, if her salary is due on last date of the month.           11
(b) Explain in brief the following items as per the Income-tax Act, 1961 (any two):    5.5x2=11                    
1)         House Rent Allowance.
2)         Statutory Provident Fund.
3)         Entertainment Allowance to Government Employees.
6. (a) A house was completed on April 1, 2017 and the following information is available about this house:
Municipal value of the house
Fair rental value of the house
Actual rent
Municipal taxes
Rs. 30,000 p.a.
Rs. 32,000 p.a.
Rs. 4,000 p.m.
Rs. 6,000 p.a.
Let out for the period 01.04.2017 to 31.12.2017 and self-occupied from 01.01.2018 onwards:

Fire Insurance Premium
Land Revenue
Interest on Loan for the period:
(1) 01.04.2014 to 31.03.2017
(2) 01.04.2017 to 31.03.2018

Calculate Income from House Property for the Assessment Year, 2018 – 19.                                        11
(b) Explain the following in brief (any two):           5.5x2=11
1)         Exempted Income from House Property.
2)         Deemed owner of House Property.
3)         Recovery of Unrealized Rent.
7. (a) Mr. P.K. furnishes the following particulars for the Previous Year ending 31.03.2018 and requests you to compute the taxable capital gain:             11
1)         He had a residential house inherited from father in December 2014, which was acquired by father in 1998 and the fair market value of which as on 01.04.2001 is Rs. 4,00,000.
2)         In the year 2006-07, further construction and improvement cost came to Rs. 1,80,000.
3)         On 18.09.2017, the house was sold for Rs. 35,00,000. Expenditure in connection with transfer was Rs. 90,000.
4)         On 20.12.2017, he purchased a residential house for Rs. 18,00,000.
Cost of inflation index:

(b) Discuss in detail the provisions of Income-tax Act, 1961 for determination of income from other sources.       11


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