M.Com. (Semester (CBCS) Examination Nov/Dec-2018
TAXATION (Paper
Time: 2½ Hours Max. Marks: 70
Instructions: All questions are compulsory.
All questions carry equal marks.
Q.1 Choose the alternatives given below. 14
Year in which assessment is conducted is known as
Previous Year Assessment Year
Accounting Year Leap Year
Education cess is leviable in case of:
An individual and HUF A company assessee only
Partnership Firms All assesses
Income tax in India is a kind of
Direct Tax
Nearest one rupee
Indirect Tax
Nearest Hundred rupee
Residential status to be determined for:
Previous year Assessment year
Accounting year ITR filing year
Agricultural income is exempt under section:
10 20
30 40
A has two house properties. Both are self-occupied. The annual value of
Both house shall be nil One house shall be nil
No house shall be nil None of these
Rent paid of shop is a kind of
Allowable Expenditure Disallowable Expenditure
No Expenditure Drawings
For person carrying on business, tax audit is compulsory, if the gross receipts
of the previous year exceeds:
Rs. 500 lakhs Rs. 400 lakhs
Rs. 100,00,000/- Rs.
Education cess is payable on
Gross Total Income
Income Tax Plus Surcharge, if any
Profit of the business
Not require to pay
10) Where the total income of a person is Rs. the income tax payable
is Rs.
Nil

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11) Income accruing in Japan and received there is taxable in India in the case of
Resident and ordinary resident only
Both resident and ordinary resident and resident but not ordinary resident
Both resident and non resident
Non resident
12) For an employee in receipt of children education allowance for his three
children, the maximum annual allowance exempt is:
Rs. Rs.
Rs. Rs.
13) Bonus received by an employee is:
Fully Taxable Partly Taxable
Non Taxable None of these
14) Holiday allowance received by an employee is:
Exempt to the extent of expenditure incurred for official purposes
Fully Taxable
Non Taxable
Partly Non Taxable
Q.2 Write short Notes. (Any two) 14
Income from other source
Any five heads of deduction under section 80C
Gross Annual Value
Q.3 Write short notes on any one of the following. 07
Allowable Expenses for business
Section 80D
Mr. Kiran is having house property at Solapur which is let out for the annual
rent of Rs. He has paid Rs. towards Municipal Tax of
local municipal corporation and Rs. for maintenance of the property.
He had borrowed loan for the construction of the said house property in
2013 and in financial year 2016-17 he has repaid the loan as follows:
towards principal Rs. towards interest 90,000/-.
07
You are required to compute taxable income from house property of Mr.
Kiran for assessment year 2017-18.
Q.4 Mrs. Anita, a resident of Chennai has furnished you the following information
related to financial year 2016-17.
14
Particulars Amount
Basic Salary 40,000 PM
Dearness Allowance 114% of Basic Salary
Bonus Equivalent to one month salary
(Salary includes Basic Salary Dearness Allowance)
House Rent Allowance
(Mrs. Anita has paid INR to is landlord PM)
16,000 PM
Telephone Allowance 2,700 PM
Fixed Medical Allowance 1,600 PM
Children Education Allowance
(Mrs. Anita has three children and she has received
Children Education Allowance for two children)
1600 PM
Hostel Expenditure Allowance
(Mrs. Anita has three children and she has received
Hostel Expenditure Allowance for two children)
2400 PM
Transport Allowance 4,000 PM
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Helper Allowance
(Mrs. Anita has appointed a helper and paid him Rs.
PM)
3,000 PM
Research Allowance
Research Allowance has been incurred by Mrs.
Anita on Research)
80,000 PA
Uniform Allowance
(Mrs. Anita has incurred all the Uniform Allowance on
purchase of Uniform)
5,000 PA
Border Area Allowance
(All the conditions are satisfied by Mrs. Anita for
claiming exemption under Border Area Allowance)
2,000 PM
Underground Allowance
(Mrs. Anita is working in mines)
1,800 PM
City Compensatory Allowance 1,600 PM
Overtime Allowance
(Mrs. Anita has worked for 179 hours overtime during
the year)
30 PH
Holiday Allowance 20,000 PA
Refreshment Allowance 4,000 PM
You are required to compute taxable income of Mrs. Anita for assessment year
2017-18. Working notes will be part of your answer.
Q.5 Mr. Sushant is working in JKL Limited and getting salary as mentioned below.
Mr. Sushant is willing to file his Income Tax Return and asking you to compute
his total taxable income.
14
Basic salary 2,00,000
Dearness Allowance 2,00,000
Bonus 20,000
House Rent Allowance 2,40,000
Lunch Allowance 44,000
Servant Allowance 40,000
Project Allowance 42,000
Holiday Allowance 36,000
Telephone Allowance 20,000
Children Education Allowance 20,000
Hostel Expenditure Allowance 30,000
Transport Allowance 56,000
Conveyance Allowance 24,000
Assistant Allowance 80,000
Uniform Allowance 3,000
Tribal Area Allowance 7,000
Underground Allowance 2,400
Mr. Sushant is having only one child. He is paying Rs. pm to
landlord towards rent. He has appointed an assistant and paid him Rs.
during the year. He is handicapped person. He has utilized 100% amount of
uniform allowance on purchase of the same.
Compute his taxable income from Salary for assessment year 2017-18 after
considering the following investments.
He has paid Rs. for premium of LIC
He donated Rs. to Trust.
He has repaid the loan which was taken for the construction for his own
house as Rs. towards principle Rs. for interest.