M.Com. (Semester (CBCS) Examination Mar/Apr-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.
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Residential status to be determined for:
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 is rounded off to:
Nearest Ten rupees
Nearest one rupee
No rounding off of tax is done
Nearest Hundred rupee
Residential status to be determined for:
Previous year
Assessment year
Accounting year
ITR filing year
Agricultural income is exempt provided the:
Land is situated in India
Land is situated in any rural area India
Land is situated whether in India or outside India
Land is situated outside India
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
Under the head Business or Profession, the method of accounting which an assessee can follow shall be:
Mercantile system only
Cash system only
Mercantile or cash system only
Hybrid system
For person carrying on business, tax audit is compulsory, if the gross receipts of the previous year exceeds:
Rs. 50 lakhs
Rs. 40 lakhs
Rs. 10 lakhs
Rs. 100 lakhs
Education cess at and secondary and higher education cess at is payable on:
Income Tax
Income Tax Plus Surcharge, if any
Surcharge
Not payable by any assessee
10) Where the total income of a person is Rs. the income tax payable is Rs.




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SLR-CX-4
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 hostel expenditure allowance for his three children, the maximum annual allowance exempt under section 10(14) is:
Rs.
Rs.
Rs.
Rs.
13) Commission received by an employee is:
Fully Taxable
Partly Taxable
Non Taxable
None of these
14) Uniform 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)
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Taxation of House Rent Allowance
Any five heads of deduction under section 80C
Education Cess and Surcharge
Q.3

Write short notes on any one of the following.
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Income from house property
Composite Rent

Mr. Karan is having house property at Solapur which is let out for the annual rent of Rs. The owner 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 2015 and in financial year 2016-17 he has repaid the loan as follows: towards principal Rs. towards interest 45,000/-.
You are required to compute taxable income from house property of Mr. Karan for assessment year 2017-18.
Q.4
Mrs. Kalyani, a resident of Chennai has furnished you the following information related to financial year 2016-17.
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Rs.
Basic Salary
20,000 PM
Dearness Allowance
114% of Basic Salary
Bonus Equivalent to one month salary (Salary includes Basic Salary Dearness Allowance)
House Rent Allowance (Mrs. Kalyani has paid INR to is landlord PM)
8,000 PM
Telephone Allowance
1,350 PM
Fixed Medical Allowance
800 PM
Children Education Allowance (Mrs. Kalyani has three children and she has received Children Education Allowance for two children
800 PM
Hostel Expenditure Allowance (Mrs. Kalyani has three children and she has received Hostel Expenditure Allowance for two children)
1,200 PM
Transport Allowance
2,000 PM
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SLR-CX-4
Helper Allowance (Mrs. Kalyani has appointed a helper and paid him Rs. PM)
1,500 PM
Research Allowance Research Allowance has been incurred by Mrs. Kalyani on Research)
40,000 PA
Uniform Allowance (Mrs. Kalyani has incurred all the Uniform Allowance on purchase of Uniform)
2,500 PA
Border Area Allowance (All the conditions are satisfied by Mrs. Kalyani for claiming exemption under Border Area Allowance)
1,000 PM
Underground Allowance (Mrs. Kalyani is working in mines)
900 PM
City Compensatory Allowance
800 PM
Overtime Allowance (Mrs. Kalyani has worked for 179 hours overtime during the year)
15 PH
Holiday Allowance
10,000 PA
Refreshment Allowance
2,000 PM
You are required to compute taxable income of Mrs. Kalyani for assessment year 2017-18. Working notes will be part of your answer.
Q.5
Mr. Daksh is working in JKL Limited and getting salary as mentioned below. Mr. Daksh is willing to file his Income Tax Return and asking you to compute his total taxable income.
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Basic salary
1,00,000
Dearness Allowance
1,00,000
Bonus
10,000
House Rent Allowance
1,20,000
Lunch Allowance
22,000
Servant Allowance
20,000
Project Allowance
21,000
Holiday Allowance
18,000
Telephone Allowance
10,000
Children Education Allowance
10,000
Hostel Expenditure Allowance
15,000
Transport Allowance
28,000
Conveyance Allowance
12,000
Assistant Allowance
40,000
Uniform Allowance
1,500
Tribal Area Allowance
3,500
Underground Allowance
1,200
Mr. Daksh 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.