BACHELOR'S DEGREE PROGRAMME Term-End Examination December, 2009 ELECTIVE COURSE : COMMERCE ECO- 11 : ELEMENTS OF INCOME TAX

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1 N- 11) O BACHELOR'S DEGREE PROGRAMME Term-End Examination December, 2009 ELECTIVE COURSE : COMMERCE ECO- 11 : ELEMENTS OF INCOME TAX Time : 2 hours Maximum Marks : 50 (Weightage 70%) Note : Attempt any four questions including question no. 1 which is compulsory. 1. Mr. Trivedi is in the teaching staff of a well known 14 college in Ahmedabad owned by a limited company. During the previous year he gets the following emoluments : Rs. Basic Salary 1,86,000 Dearness Allowance (forming part of his salary) City compensatory Allowance Children's education allowance (Rs. 65 per month for three children) (e) House Rent Allowance (rent paid Rs. 20,000) 12,300 3,100 2,340 16,200 1 P.T.O.

2 He gets Rs. 18,890 as reimbursement from the employer in respect of expenditure incurred on medical treatment of his family members. He also gets Rs. 12,600 as reimbursement from the employer in respect of books and journals purchased by him. (h) He contributes 11% of his salary to recognised provident fund to which a matching contribution is made by the employer. Besides, he incurrs an expenditure of Rs. 10,000 as insurance premium on his life policy (sum assured Rs. 50,000). Compute his taxable income from his salary and the amount of deduction under section 80 C for the year Explain the salient features of Section 80 C of the 8,4 Income Tax Act. Also explain as to how it affects the deductions under sections 80 CCC and 80 CCD. 2

3 3. (a) Gyaneshwar is a resident individual who 6 submits the following particulars of his income for the year ended Rs. Agricultural income in 25,000 Nepal Director's Fees 10,000 Interest on postal 500 Savings Bank A /c. Interest on Deposits 2,500 with IFCI Dividend received from 3,500 a co op. society Rent from sub-letting a 60,000 house Rent payable on sub-let 46,750 house Winnings from horse 61,500 race Compute this income from other sources for the assessment year (b) What do you mean by annual value of a 6 house property? Show its calculation with an example and state how does standard rent affect its determination. 3 P.T.O.

4 4. (a) Explain the scope of Total Income of an 6 assessee on the basis of his residential status in the previous year. (b) From the following information compute the 6 amount of long term capital gain of the assessee for the assessment year : Listed shares purchased on for Rs. 40,000 sold for Rs. 1,80,000 on Gold ornaments purchased for Rs. 2,00,000 on sold for Rs. 3,20,000 on Cost of living index for was 551 and and it was 351 and 389 respectively. Also state the amount of capital gain that shall be taxable assuming that the shares had been sold through recognised stock exchange and security transaction tax has been duly paid thereon. 5. (a) Define the term 'Perquisites' and state any 6 five perquisites that are fully exempt from tax. (b) State the consequences of delay in filling of 6 returns. 4

5 6. Write short notes on any three of the following : 4,4,4 Bond washing transactions. Death-cum-retirement gratuity Taxation of winnings from lotteries, horse races, card games, etc. Grossing up of interest on less tax securities (e) Deduction in respect of Entertainment Allowance. - o 0 o - 5 P.T.O.

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7 31-Er4 tf-tar -R-q74 -circii -ER f-*--q, i-zr 01;1-51-nr-dift tc Li ri41thi -51FFI 18,890 T. Trf-A--*74 7 -T-r--7. -z1 1, d-T-N f9-zn-wi wi 12,600 T. (h) 3T-Er-4 k-d-a- chi 11% c11 7TI1 ITF-diszT r-irg 31'71-qrfTi 7--r-kai-ffrata ai-crt err Tuf-oit(r Trr-7 50,000 T. t) i 10,000 T. atf fry 1-).1,,{ cb -ff2it NRT 80 C cb ;1 2.3Tp-f*-7 3Tf rrn1 R180C cn1-41-&4 fa dt3rn1 8,4 1ft TITE -wrr--a7 f q-r-r 80 CCC '47T 80 CCD <4;1 crzl1i i c fir ichr 3 11-rf-a-ff t 8

8 3. (a) Rd'1474TNT7-0-r-d-zrr fiq-rt t;- f-qth-zr 6 ci ti F d 31 rq 571 : T. keit Tfti. 3TFT 25,000 Thti 10,000 sich 779. Lc wci 41( ITT.jrri 2,500 (v) TITTrt 7T1-14f-d. 74 II-1 3,500 Islas (vi) 4-1 cht-r 3i-r4 f-*-u ITT 60,000 3cif t4 (sub-letting) -9-Fr ft7-r-z (vii) 34-r4 f* JR 46,750 H ch tzif 'I q f f-*--trzu 1.)s ct)1 61,500 7-rwr apt finitur Ch 31{ a-, 7:1)-r73-Trzr a.)1,1utli (b) 4-1* I 'T qlftsit q-,1 t? 6 d^l^t U l ct 'ICI ii 1;1 raiq ol c fa, 4-11-r =h f*--trzu 4:1 'qu ill a-) -f-*-7=r iachr 5 91Tr-d.WT-dfit 9 P.T.O.

9 4. (a) ad 7ff 14 f9-41t 3-TRTR TR 7T finiftt cr>1 6 3-Trzi 4;1 ch1 oear?if --1-fA7 I (b) -{1131T TIT fffnftitt t 64, -F-rif-T-d 8144)1 11-i Itrm M ?TAT : ,000 T C1-tr 71-41f=17 *zit 4) chl 1,80,000 T at1 2,00,000 T. -4-4J-T1-Tr) =hl 3,20,000 T. -11 Jim mi Mind tci ciii ci-) =t)i-rf: I I fah 71--zr4.) 4-11-q c dti 'TT 'Arctlft ch,& chi lirrdti fwzil 4 1i1, 411 olci 111 r Trft 4q r trt? 5. (a) 31-17VI-T' (Perquisites) ch1 (-i outrr 6 L11-4 t (b).11,y0 31TW{ r4ci+, u 1 6 Lik u icil5 I 10

10 6. r-t 4--1 Fri PA cf-4 TR ik-rtfzwru foftr : 4,4,4 kt_g i c a (Bond washing transactions) 1--M TqW71 17-crT 1-j7Fd clka, TO3-, cir1.,11d =1;) TIFF 51fci (e) c4 - o 0 o - 11