T.Y.B.COM.

TAXATION

REVISION TEST-3 (University)

SECTION-I Q.1 From the following Income and Expenditure Account of Dr. Kamble compute his total taxable income for Assessment Year 2011-12. (16) Income & Expenditure Account for the year ended 31-3-2011 Expenditure Income To To To To To To Staff Salaries Dispensary Expenses Dispensary Rent Purchase of Medicines Income Tax Professional fees to Doctors To Car Expenses (For Profession) To Membership Fees To Municipal Tax for Rented House To Interest on housing Loan For Rented House To Printing Charges To Depreciation To Charity To Surplus for the year Additional Information: 1. Gifts from patients include 1,000 from his father in personal capacity. 45,000. 8,000 by cheque. 2. Depreciation as per Income Tax Rules 3. He paid medical insurance premiums of 1,20,000 67,500 60,000 45,000 35,000 22,000 36,400 2,000 12,000 18,000 4,000 48,000 1,500 2,68,600 7,40,000 7,40,000 By By By By Consulting Fees Visit Fees Gifts from Patients Sale of Medicines at the Dispensary By Rent from House Property 4,00,000 1,00,000 40,000 80,000 1,20,000

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

4. He purchased National Savings Certificates of 30,000 and paid Life Insurance Premium of 60,000. 5. He paid 20,000 to Nationalised Bank towards Principle Repayment of Housing Loan. Q.2 (a) 1. 2. 3. State whether True or False. Every Person does not have to pay Income Tax. Residential status has nothing to do with citizenship. Mediclaim premium paid by the employer on behalf of employee is a Tax free perquisite. Municipal tax is a deduction from net annual value. Fill in the Blanks. Commercial Training service became taxable w. e. f. ________ . A person seeking registration under Service Tax should file an application in Form No. _________ . Total no. of taxable services as on 1st April 2011 is _________ . If registration is not granted within ____ days of application, it is deemed to have been granted. Rewrite the following sentences by selecting the correct option. (4) (4) (4)

4. (b) 1. 2.

3. 4.

(c) 1.

Total income of a person is determined on the basis of his (a) Citizenship (b) Marital status (c) Residential status Uncommuted Pension received by a Government employee is (a) Exempt (b) Partly Exempt (c) Taxable

2.

3.

Mr. Shivaprasad pays tuition fees of 10,000 for M.Com Part I for his wife. The amount deductible under section 80C shall be (a) Exempt (b) Partly Exempt (c) Taxable

4.

Salary received by Manager of Agriculture Farm is (a) Fully Exempt (b) Partly Exempt

(c) Fully Taxable

Q.3

Shri. Gangadhar Joshi took voluntary retirement on 1st October, 2010. He has completed 20 years of service in Tech-India Ltd. He furnishes the following for the year ended 31st March, 2011. (12) a) Basic Salary 40,000 per month. 2,000 per month. 2,000 per month. b) Dearness allowances @ 60% of Basic salary. c) Entertainment allowance received d) Conveyance allowance received

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

(Exempt 800 per month.) 8,50,000. 5,00,000) 2,34,000. 96,000. e) Voluntary retirement compensation (Exempt u/s 10 @ (fully exempt) f) g) Gratuity received (fully exempt) h) Professional Tax paid i) j) l) Uncommuted pension 2,500. 10,000 per month. 15,000 Commuted pension (1/3rd exempt)

Leave encashment (fully exempt) 3 months basic.

k) He paid

15,000 towards LIC premium.

He paid interest on loan taken for Higher education of son

Compute his Net Taxable Income for the Assessment Year 2011-12. OR Q.4 Mr. Narendra owns three houses, the details regarding which for the year ended 31st March, 2011 are as follows: (12)

1. The first house of the annual value of 12,500 was let out at 1,800 per month. He paid 2,000 as interest on money borrowed for construction of this house, 450 as ground rent and 600 as fire insurance premium. Principal repayment is 1,000. 2. The second house of the annual rental value of 55,000, was occupied by him for his residence. Its municipal taxes were 12,500. He had borrowed 1,00,000 from H.D.F.C. Ltd. for its repairs on which 29,000 interest was due for the year. Insurance Premium paid was 2,000 and principal repayment is 9,120. 3. The fair rent of the third house is 30,000 and its actual rent is 25,000, but in respect of this house a legal maintenance charge of 7,000 per year existed in favour of his mother, as per terms of a family arrangement. The details of his other receipts during the year are as follows: i. Interest received on fixed deposits with Hindustan Lever Ltd. 2,000. 3,000. ii. Directorship fees received from J.N.A. Ltd. ii. Dividends received from : ACC Ltd. 700 (declared on 2nd May, 2010 and paid on 31st May, 2010 Zuary Industries Ltd. 900 (declared on 1st July, 2010.) iv. Winnings from Lottery Mr. Narendra donated donated clothes worth 1,00,000. 6,000. v. Income from Unit Trust of India

1,000 as medical aid to a poor person, and also 5,000 to an approved institution.

Compute his Total Taxable Income for the assessment year 2011-12.

OR

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

Q.5 (a) Mr. Ram Gopal Varma, a citizen of USA has been staying in India since 1989. He leaves India on 16th July 2010 on a visit to USA and returns on 4th January 2011. Determine his residential status for the previous year 2010-11. (6) (b) Shri Vinod Vyas purchased a residential house on 1st August 1978 for 2,00,000. The Fair market value of the house on 1-4-1981 was 3,00,000. He incurred 1,00,000 towards cost of Improvement during the previous year 1983-84. He sold the House on 31st December, 2010 for 30,00,000. He paid brokerage of 50,000. The cost Inflation Index for Financial Year 1981-82 is 100 for Financial Year 1983-84 is 116 and for the Financial Year 2010-11 is 711. Compute Capital gains of Shri Vinod Vyas for the Assessment Year 2011-12. (6) SECTION II Q.6 State with reasons whether the following activities would form a part of Taxable service or not, under the respective services: (10) (a) (b) (c) (d) (e) Renting of Immovable property by a religious body Commercial Training Centre imparting skill or knowledge or lessons to students. Services of production or processing of Goods in relation to manufacture of cut and polished diamonds. Royalty received by a Chartered Accountant on a book in Accountancy Shooting of a TV serial in a rented studio premises. OR Q.6 Choose the correct option and rewrite the statement:(a) (b) (c) Service Tax is applicable to Whole of India Whole of India except Jammu & Kashmir Jammu & Kashmir only Where any Taxable service is provided by a Non - resident, Service Tax is not payable is payable by the service recipient is payable by service provider. Return of Service Tax has to be field Monthly Half yearly Yearly (10)

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

(d) (e) (f) (g) (h) (i) (j) Q.7. Due date of Payment of Service Tax, other than for the month of March, in case of a company is 5th day of the month immediately following the calendar month 5th day of the month immediately following each quarter Last day of the month Renting of Immovable property includes Letting Leasing Letting and Leasing both Business Auxiliary Service became taxable w. e. f. 1 7 2003 1 7 1997 1 6 1997 If the charges for the Taxable Services have been received in advance before rendering of the services No Service Tax is payable on Receipt of Advance The Service Tax is payable on Rendering of Service The Service Tax is payable on Receipt of Advance. The Certificate of Registration under Service Tax is in Form ST 1 Form ST 2 Form ST 3 Service Tax Law is governed by The Income Tax Act, 1961 The Service Tax Act Chapter V of the Finance Act, 1994 The Credit of the Service Tax paid on the input service is Governed by The Service Tax Act The CENVAT Credit Rules, 2004 The Finance Act, 1994

M/s. Arif & Associates a works contractor has executed a works contract. The details are given below: (10) Particulars Charges for planning, designing and Architects fees Labour charges for execution of the works contract Charges for Hire of Machinery 1,00,000 12,00,000 2,00,000

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

Value of Goods transferred during execution of works contract (Net) VAT on above Goods @ 20% Cost of consumables such as Water, Electricity etc. Amount paid to a Subcontractor for Labour 2,00,000 40,000 75,000 2,50,000

Compute the service tax payable assuming that he has opted for the composition scheme. OR Q.7 During the year ended 31.3.2011, Kohil & Co. Running a coaching centre has collected. A sum of Rs.10.2 lacs as service tax. Rs.70,000 was net through Cenvat credit and balance was paid by cheque on various dates. The details pertaining to the quarter ended 30.06.2011 are as under: (10) Particulars Value of free coaching rendered Coaching fees collected from the students (Service tax collected separately) Advance received from a college for coaching their students on 30.6.2011 Determine the service tax liability for the quarter. Q.8 1. 2. 3. 4. 5. State whether the following are Sale under the MVAT ACT 2002. Give reason. Sale of Sim Card Free Samples Pledge of Goods Branch Transfer Mortage OR Q.8 Choose the correct option and rewrite the statement: (10) 1. M/s. Darshan & Co. Solapur, purchased goods for 15,300 (inclusive of CST 300) from M/s. Siddhesh & Co. Gandhidham. He sold these goods to Shravan & Co. Yavatmal for VAT @ 12.5%). The VAT payable is (a) 2,200 (b) 300 22,500 (inclusive of (c) 2,500 (10) 20,000 14,50,000 3,00,000

2. VAT at 12.5% is under (a) Schedule A (b) Schedule D (c) Schedule E

3. M/s. Deepak Sane & Co. purchases goods for 90,000 and sells them for 1,20,000 (both excluding tax), the goods being classified under Schedule 'D'; the Net Tax Payable wH be (a) 24,000 (b) 6,000 (c) 18,000

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

4. Schedule 'C' goods include (a) Gold, Silver, Precious metals (b) All declared goods (c) Basic Goods such as Agricultural Tools, Books, Vegetables 5. Under a composition scheme under section 42, rate of 5% is applicable to (a) Works contract other than construction contracts (b) Construction contracts (c) Mandap keeper 6. 'Goods' as defined under MVAT Act, 2002 do not include (a) Trees (b) Lottery tickets (c) Livestock

7. A retailer has opted for composition scheme, his sales are 25,00,000 and purchases from unregistered dealers 4,00,000 and purchases from registered dealers are 15,00,000, the Composition Tax payable is (a) 80,000 (b) 1,68,000 (c) 48,000

8. A product is sold @ 150 per unit. The octroi is 6 per unit and the excise duty 10 per unit, the packing charges were 14 per unit, the sale price liable for MVAT is (a) 166 (b) 160 (c) 180

9. A Tax invoice is to be issued (a) Only by Importer (b) Only by Registered Dealer (c) Only by Consultant 10. Taxable purchases for the purpose of registration include (a) purchases under Schedule A (b) purchases from other states. (c) total purchases taxable under MVAT Q.9. M/s. Herwadkar and Associates commenced business on 27th March, 2011. From the following particulars regarding purchases and sales transactions, find out from which date he will be liable for Registration and to pay tax as per the provisions of MVAT Act 2002. Give reasons. (10) Date Purchases Sales Taxable 27-03-2011 28-03-2011 29-03-2011 02-04-2011 6,000 3,000 1,500 6,000 Tax Free 18,000 25,000 80,000 2,28,000 Taxable 8,000 1,000 500 8,000 Tax Free 24,000 32,000 95,000 3,75,000

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

04-04-2011 07-04-2011 08-04-2011 01-04-2011 15-04-2011 4,000 10,000 6,000 4,000 5,000 OR Q.9 M/s. Bansode and co. is a dealer in chemicals. From the following information find out its Tax liability for the month of Sept., 2011 as per the provisions of MVAT Act., 2002. (10) Particulars Sales (Inclusive of tax) Schedule C Goods @ 4% Schedule E Goods @ 12.5% Purchases (Inclusive of tax) Schedule C Goods @ 4% Schedule E Goods @ 12.5% Schedule B Goods @ 1% 4,16,000 28,12,500 32,28,500 6,24,000 16,87,500 5,05,000 28,16,500 SECTION III Q.10 (a) Mr. Ravindra is employed with Victory Enterprises. He provides you with following information for the year ended 31 2011: Net Salary (after deducting income tax, profession tax And Installment of loan from employer) Income tax deducted from salary Profession Tax deducted from salary Installment of loan deducted from salary Bonus received from employer Loan taken from employer for higher education of son Reimbursement of medical expenses incurred He received dividend from the NKGSB Co-operative Bank Ltd. He received net interest 10,764 on fixed deposits with Bank (TDS 1,236)
st

1,75,000 1,00,000 1,20,000 75,000 1,10,000

1,000 20,000 15,000 10,000 5,000

1,05,000 1,10,000 1,05,000 2,10,000 1,28,000

(12) March

25,000 1,800 200 2,000 30,000 1,50,000 27,400 8,000 24,000

Per Per Per Per

Month Month Month Month

Complete his Taxable Income from salary for the Assessment year 2011-12

IDEAL/T.Y.B.COM/TAXATION/REVISION TEST-3 (UNIVERSITY)

Q.10 (b) Answer any four of the following with reference to the Assessment year 2011-12, giving reason in brief wherever necessary. (8) 1. Tata Steel Ltd., being an Indian Co. has its major business in India. What is the residential status of the company? 2. Mr. Sachin retired from a Government Organisation. He received pension of 5,000 p.m. During the previous year, he claims this pension as exempt being received from a government organisation. In his claim correct? 3. Mr. Yogesh Datey has given his commercial property on rent of p.m. He claims this as a business income. Is he right? 4. Mr. Aditya sells his mother car for depreciation for 11 months. 1,00,000

1,00,000 on 28/02/2010 and claims

5. Miss Smita earns 25,000 as interest on public provident fund (PPF) Account. She claims that this Income is not Taxable in her hands. Is her claim correct? 6. Mr. Manoj Shinde is physically handicapped (45%) as certified by medical authorities. He claims a deduction of 1,00,000/- U/s 80 U. Is he correct?

NOTE:REVISION TIME TABLE

Day Monday Tuesday Wednesday Friday Friday Saturday Sunday Date 5/3/2012 6/3/2012 7/3/2012 9/3/2012 9/3/2012 10/3/2012 11/3/2012 Subject Fin./Cost./Audit. Fin./Mgmt. Fin./Cost./Audit. Fin./Mgmt. Tax Fin./Cost./Audit. Fin./Mgmt. Branch Go/K(E)/Bhy/ NS Bo./Vasai/ Virar VP./S./Bandra Andheri Dinanath Hall Prabodhankar Thakare Hall Hall