TYBCOM Sem 5 Direct Tax Question Paper
TYBCOM Sem 5 Direct Tax Question Paper

TYBCOM SEM 5 Direct Tax Question Paper

November 2018

(3 Hours)                                                                                                                                            (Total Marks 100)

N.B.
1) All questions are compulsory.
2) Figures to the right indicate maximum marks.
3) Working should form part of the main answer.

Q.1 A) Choose the correct option and rewrite the statements (Any Ten): (10 marks)

1) Income Tax Act extends to __________.
a) Whole of India
b) India and Pakistan
c)Whole of Maharashtra

2) Income Tax is a tax on ___________.
a) Goods
b) Services
c) Income

3) The Legal status of Ms. Hima Das, Indian sprint runner is ___________.
a) an individual
b) a body of individuals
c) a sportsman

4) Personal 24 carat gold mangalsutra is _________ asset.
a) Fixed on
b) Capital
c) Current

5) Every assessee is a person and __________.
a) Every person is also an assessee
b) Every person need riot be an assessee
c) An individual is always an assessee

6) Total income of a person is determined on the basis of his ___________.
a) Citizenship
b) Residential Status
c) Marital Status

7) In case of capital assets acquired on 01 -04-1971, Fair Market Value of this capital asset is determined as on ___________.
a) 01-04-2001
b) 01- 04- 1981
c) 01-04-1971

8) Deduction under Section 80D in respect of medical insurance premium is allowed to __________.
a) An individual
b) Any assessee
c) An individual and HUF

9) Share of profit received by a partner of partnership firms ___________.
a) Fully exempt
b) Fully taxable
c) Partly Treble

10) Uncommuted pension received by a government employee is ___________.
a) Exempt
b) Taxable
c) 1/3 exempt

11) The deduction under Section SOE is allowed for payment of interest to the extent of __________.
a) ₹25,000
b) ₹10,000
c) any amount

(12) Award received from the government is ___________.
a) Taxable
b) Exempt
c) Partly exempt

Q.1 B) Re-write following full sentence and state whether it is True or False (Any Ten): (10 marks)

  1. Ex-gratia received from employer is taxable as a salary.
  2. When a property is occupied by the owner himself that property is called let-out house property.
  3. Expenses on local festival Navaratri puja is allowable business expenditure.
  4. Previous year can be more than 12 months.
  5. There are total five heads of income.
  6. Salary received by a Member of Parliament is taxable under the head Income from salaries.
  7. Cost inflation index is applicable for transfer expenses.
  8. The status of Indian origin individual is always a resident.
  9. Ground tent is taxable under the head income from house property.
  10. Gift received by a doctor from his patient is taxable under the head income from profession.
  11. Interest on Income Tax refund is taxable under the head income from other sources.
  12. Any sum received under key-man insurance policy is taxable,

Q.2) Mr. Abhijit, who is physically disabled to the extent of 55%, works in a private company. He has provided the following particulars of his income for the previous year ended on 31 March, 2018. (15 marks)

1) Basic Salary ₹40,000 per month.
2) Dearness Allowance ₹16,000 per month.
3) House Rent Allowance ₹10,000 per month.
[Exempt (under section 10) ₹6,000 per month.]

4) Travelling Allowance ₹50,000.
(Amount actually spent on travelling ₹38,000)
5) He was provided with the accommodation by his employer, of which was ₹35,000.
6) Bonus declared by employer during the year was ₹15, 000.
7) Profession tax ₹2,500.
8) Employee’s contribution to Provident Fund ₹48, 000.

He also received the following:
9) Interest on fixed deposits with Bank of India ₹44,000.
10) Interest on fixed deposits with Post Office ₹10,000.
11) Dividend from co-operative credit society ₹6,500.
12) Gift from his sister ₹51,000.
During the year, he paid ₹32,000 as premium on his Life Insurance Policy.
Compute his taxable income for the Assessment Year 2018-19

OR

Q.2) Mr. Kedar was a Maharashtra State Government employee, who retired on 30th November,2017. Thereafter, he joined a private company from 1st January, 2018. (15 marks)
He has provided the following particulars fc for the previous year ended on 31st March 2018.

(A) From Maharashtra State Government:
Basic Salary @₹30,000 per month.
Dearness Allowance @₹10,000 per month.
Gratuity received on retirement ₹3,00,000.
Commutation of Pension received on retirement ₹2,20,000.
Pension received @₹8,000 per month.
Profession tax deducted @₹200 per month.
Employee’s contribution to provident fund @₹5,000 per month.

(B) From Private Company:
Salary ₹25,000 per month.
Entertainment Allowance @₹2,200 per month.

(C) Other Information:
Interest received on company debentures ₹60,000.
Dividend received from Indian Companies ₹32,000.
Interest received on 8% Taxable RBI Bonds ₹20,000.
During the year, he deposited ₹50,000 in his PPF account and paid ₹22,000 towards medical insurance premium for himself and his spouse.
Compute his taxable income for the Assessment Year 2018-19.

Q.3) Mr. Sanghameetra provides the following information for the previous year ended 31st March, 2018. You are required to compute his net taxable income for Assessment Year 2018-19. (15 marks)
Profit and Loss A/c for the year ended 31% March, 2018

ParticularsParticulars
To Printing & Stationery20,000By Gross Profit8,50,000
To General expenses25,000By Income Tax Refund8,000
To Interest on capital55,000By Dividend from UT35,000
To GST Penalty23,000By Interest on Saving Bank A/c5,000
To Income Tax49,000By Amount received from LIC for matured insured policy15,000
To Office Rent26,000
To Depreciation30,000
To Salaries1,20,000
To Advertising9,001
To Net Profit5,55,999
Total9,13,000Total9,13,000

Additional Information:

Salaries includes ₹55,500 for medical treatment of Mr. Sanghameetra’s dependent brother, who is person with severe physical disability (81%).

OR

Q.3) The following is the Receipts and Payments Account of Advocate Happy Salve for  the year ended 31st March, 2018: (15 marks)
Receipt and Payment A/c

Receipts Payments
To Balance b/d4,00,000By Office Expenses8,00,000
To Fees from clients25,00,000By Stamp paper & court fees3,00,000
To Fee for fighting India’s case at International Court1By Salary to staff15,00,000
To Income for attending court hearing7,00,000By Office Rent4,00,000
To Gift received from client5,55,555By Conveyance1,00,000
To Dividend from foreign company10,000By Drawings6,00,000
To Rent from open plot of land12,000By Balance c/d4,77,556
Total41,77,556Total41,77,556

Additional Information:

(1) Drawings includes ₹99,000 towards pension fund (U/S 80CCC) of LIC and ₹92,000 for medical treatment expenditure of his son who is physically disabled to the extent of 51%.
You are required to compute his net taxable income for the Assessment Year 2018-19.

Q.4) Mr. Aniket furnishes you the following particulars of income earned by him during the previous year ended on 31st March, 2018. (15 marks)
Compute his Gross Total Income for the Assessment Year 201 8-19 assuming that he is:
1) Resident and Ordinarily Resident.
2) Resident but not Ordinarily Resident.
3) Non-Resident.

S.No.Particulars
1)Income from business in Delhi, controlled from London2,00,000
2)Interest on Debentures of Indian Company received in Japan2,20,000
3)Rent from property in France received in Mumbai2,40,000
4)Interest on Bank Accounts in Dubai1,20,000
5)Income from agriculture in Sri Lanka1,40,000
6)Income from business in Nepal controlled from India1,60,000
7)Salary earned and received in Singapore1,80,000
8)Past untaxed profits earned in U.K. brought to India during the previous year.2,60,000

OR

Q.4) Mr. Pratham is an Indian citizen. He visits various countries for the purpose of his business. Following are the details of his visits out of India: (15 marks)

Name of CountryDate of Departure from IndiaDate of Arrival in India
Germany (for first time)01.07.201501.03.2017
France10.04.201728.04.2017
U.K.15.05.201701.06.2017
Australia28.06.201715.07.2017
Singapore01.09.201717.09.2017
China01.02.201822.02.2018

Determine his residential status for the Assessment Tear 2018-19

Q.5) Mr. Mahesh is the owner of two houses. He provides you the information of these two houses for the year ended on 31% March, 2018 as under: (15 marks)

a) First house is let-out with municipal valuation ₹3,00,000 p.a. and actual rent ₹30,000 p.m. municipal tax paid @10% on municipal valuation. Interest on housing loan paid £50,000 and house was vacant for 2 months.
b) Second house is self-occupied property with municipal valuation ₹1,00,000, municipal tax paid ₹10,000 and interest on housing loan paid ₹45,000.

c) He also received following income during year:
Interest on deposit with companies ₹1,60,000

Dividend from Bank of India              ₹40,000

Interest on Saving Bank Accounts     ₹15,000

Dividend from co-operative bank     ₹10,000

d) He also deposited £1,20,000 in P.P.F. during the Previous Year.

You are required to calculate taxable income for the Assessment Year 2018-19.

OR

Q.5) Mr. Dinesh provides the following particulars of assets transferred by him during the previous year ending 31st March, 2018. You are required to compute his Income from Capital Gains chargeable to tax for Assessment Year 2018-19. (15 marks)

A residential house in Indore was purchased on 12″ December, 1998 at a cost of ₹18,00,000. Fair Market Value of the residential house on 1st April, 2001 was ₹25,00.000. The cost of improvement incurred by him was as follows:

Financial YearAmount
1999 – 20002,00,000
2003 – 20043,27,000
2009 – 20103,70,000
2014 – 20158,40,000

He sold the above house on 19th March, 2018 for ₹1,50,00,000.
He incurred transfer expenses of ₹3,00,000 on the sale transaction.
He purchased a new residential house in Bhopal for ₹40,00,000 on 28th March, 2018.
He purchased 3 years bonds issued by Rural Electrification Corporation (REC) for ₹12,00,000 on 29th March, 2018.

Cost Inflation Index are as follows:

Financial YearCost Inflation Index
2001 – 2002100
2003 – 2004109
2009 – 2010148
2014 – 2015240
2017 – 2018272

Q.6 a) Explain the term Income with suitable examples. (10 marks)
Q.6 b) Explain the deductions under Income from other sources. (10 marks)

OR

Q.6 Write short notes on any four of the following: (20 marks)

i) Assessment Year and Previous Year.
ii) Taxable perquisites.
iii) List of assets which are not capital assets.
iv) Allowable business expenditure.
v) Deductions under Income from house property.
vi) Deduction under section 80DD.

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