<\/p>\n
<\/p>\n
This Paper has 37 answerable\u00a0questions\u00a0with 0 answered.<\/p>\n
Total\u00a0No. of\u00a0Questions\u20146]
\nTime Allowed \u2014 3 Hours<\/p>\n
Maximum\u00a0Marks \u2014 100
\nAnswers to\u00a0questions\u00a0are to be given only in English except in the cases of candidates who have opted for Hindi medium. If a candidate who has not opted for Hindi medium, answers in Hindi, his answers in Hindi will not be valued.
\nQuestions\u00a0of both the Sections have been given together without the Sections being mentioned in the question\u2013paper. Candidates are advised to attempt all the requiredquestions\u00a0in the same answer-book.
\nAttempt all\u00a0questions
\nWorkings notes should form part of the answer. Wherever required, suitable assumptions may be made by the candidate.
\nMarks
\n1. (a) Rajat is a Chartered Accountant in practice. He maintains his accounts on cash basis. He is a Resident and ordinarily resident\u00a0in India. His\u00a0profit and loss account\u00a0for the year ended March 31, 2008 reads as follows:
\nExpenditure Rs. Income Rs.
\nSalary to staff
\nStipend to articled\u00a0assistants
\nIncentive to articled assistants
\nOffice rent
\nPrinting and stationery<\/p>\n
Meeting, seminar and conference
\nRepairs, maintenance
\nand petrol of car
\nSubscription and periodicals<\/p>\n
Postage, telegram and fax<\/p>\n
Depreciation
\nTravelling expenses
\nMunicipal tax paid in respect
\nof house property
\nNet profit 5,25,000
\n18,000
\n5,000
\n24,000
\n6,600<\/p>\n
38,600<\/p>\n
22,400
\n15,000<\/p>\n
32,500<\/p>\n
29,500
\n55,000<\/p>\n
1,000
\n8,76,005 Fees earned:
\nAudit
\nTaxation services
\nConsultancy 6,65,800
\n4,68,600
\n3,82,000
\nDividend on shares of
\nIndian companies (gross)
\nIncome\u00a0from Unit Trust
\nof India
\nProfit on sale of shares
\nHonorarium received
\nfrom various institutions
\nfor valuation of answer
\npapers
\nRent received from
\nresidential flat let out<\/p>\n
15,16,400<\/p>\n
9,635<\/p>\n
6,600
\n15,620<\/p>\n
16,350<\/p>\n
84,000
\n16,48,605 16,48,605
\nOther information:<\/p>\n
(i) The\u00a0total\u00a0travelling expenses incurred on foreign tour was Rs.20,000 which was within the RBI norms.
\n(ii) Incentive to articled\u00a0assistants\u00a0represent amount paid to two articled\u00a0assistants\u00a0for passing PE\u2013II Examination at first attempt.
\n(iii) Repairs and maintenance of car includes Rs.1,600 for the period from 1.10.2007 to 30.09.2008.
\n(iv) Salary include Rs.30,000 to a computer specialist in cash for assisting Mr. Rajat in one professional assignment.
\n(v) Rs.1,500, interest on loan paid to LIC on the security of his Life Insurance Policy and utilised for repair of computer, has been debited to the drawing account of Mr. Rajat.
\n(vi) Birthday gifts received by his minor son include cash Rs.30,000, which was deposited with a nationalised bank. Interest accrued upto 31.3.2008 amounted to Rs.1,500.
\n(vii) Medical Insurance\u00a0Premium on the health of:
\nAmount Mode of payment
\nSelf
\nDependent brother
\nMajor son dependent on him
\nMinor married daughter
\nWife dependent on assessee 10,000
\n5,000
\n3,000
\n2,000
\n6,000 By Cheque
\nBy Cheque
\nBy Cash
\nBy Cheque
\nBy Cheque
\n(viii) Shares sold were held for 10 months before sale.
\n(ix) Rajat paid life membership subscription of Rs.1,000 to Chartered Accountants Benevolent Fund. The amount was debited to his drawings account. The Chartered Accountants Benevolent Fund is an approved fund under section 80G of Incometax, 1961.
\nCompute the\u00a0total\u00a0income\u00a0and tax payable of Rajat for the Assessment year 2008\u201309<\/p>\n
20 (0)
\n(b) Aarav converts his plot of land purchased in July, 2001 for Rs.80,000 into stock\u2013in\u2013trade on 31st March, 2007. The fair market value as on 31.3.2007 was Rs.1,90,000. The stock\u2013in\u2013trade was sold for Rs.2,25,000 in the month of January, 2008.
\nFind out the taxable\u00a0income, if any, and if so under which \u2018head of\u00a0income\u2019 and for which Assessment Year?
\nCost Inflation Index:<\/p>\n
F.Y. 2001 \u2014 2002
\nF.Y. 2006 \u2014 2007
\nF.Y. 2007 \u2014 2008 \u2014 426
\n\u2014 519
\n\u2014 551
\n5 (0)
\n(c) Vinod is a person carrying on profession as film artist. His gross receipts from profession are as under:
\nRs.
\nFinancial year 2005\u201306
\nFinancial year 2006\u201307
\nFinancial year 2007\u201308 1,15,000
\n1,80,000
\n2,10,000
\nWhat is his obligation regarding maintenance of books of accounts for each Assessment Year under section 44AA of\u00a0Income\u2013tax Act, 1961?<\/p>\n
5 (0)
\n2. (First Alternative) 6×2=12
\n(a) Explain the orders appealable to Tribunal under Section 253 of the\u00a0Income\u2013tax Act. (0)
\n(b) Explain the computation of capital gain in case of depreciable asset under section 50. (0)
\n(Second Alternative) 6×2=12
\n(a) What do you understand by the reference to Valuation Officer under section 55A of theIncome\u2013tax Act, 1961? (0)
\n(b) Discuss the cross transfers in the context of\u00a0Income\u2013tax. (0)
\n3. (a) Choose the correct answer with reference to the provisions of the\u00a0Income-tax Act, 1961 : 10×1=10
\n(i) In respect of a resident assessee, who is of the age of 65 years or more at any time during the\u00a0previous\u00a0year relevant to the Assessment Year 2008\u201309 \u2013
\n(a) Rebate of tax payable subject to a\u00a0maximum\u00a0of Rs.20,000
\n(b) Higher basic exemption of Rs.1,50,000
\n(c) Higher basic exemption of Rs.1,95,000
\n(d) Higher basic exemption of Rs.1,35,000. (0)
\n(ii) Income\u00a0accruing in Japan and received there is taxable\u00a0in India\u00a0in the case of \u2013
\n(a) Resident and ordinarily resident only
\n(b) Both resident and ordinarily resident and resident but not ordinarily resident
\n(c) Both resident and non\u2013resident
\n(d) Non\u2013resident (0)
\n(iii) For an employee in receipt of hostel expenditure allowance for his three children, themaximum\u00a0annual allowance exempt under section 10(14) is \u2013
\n(a) Rs.10,800
\n(b) Rs.7,200
\n(c) Rs.3,600
\n(d) Rs.9,600 (0)
\n(iv) The due date for filing of return for an individual assessee who is not required to get his books of accounts audited under section 44AB for Assessment Year 2008\u201309 is
\n(a) 31st July, 2008
\n(b) 30th September, 2008
\n(c) 31st October, 2008
\n(d) 30th November, 2008 (0)
\n(v) Under section 44AE, presumptive taxation is applicable at a particular rate provided the assessee is the owner of a\u00a0maximum\u00a0of certain number of goods carriages. The rate per month or part of the month and\u00a0maximum\u00a0number specified under the section are \u2013
\n(a) Rs.3,500 for a heavy goods carriage and Rs.3,150 for other goods carriages for an assessee owning not more than 10 goods carriages at any time during the year
\n(b) Rs.3,500 per carriage for an assessee owning not more than 10 goods carriages at the end of the\u00a0previous\u00a0year
\n(c) Rs.3,500 for a heavy goods carriage and Rs.3,150 for other goods carriages for an assessee owning not more than 12 goods carriages at the end of the\u00a0previous\u00a0year
\n(d) Rs.2,150 per carriage for an assessee owning not more than 10 goods carriages at the end of the\u00a0previous\u00a0year.
\n(0)
\n(vi) Rakesh received Rs.70,000 from his friend on the occasion of his birthday.
\n(a) The entire amount of Rs.70,000 is taxable
\n(b) Rs.25,000 is taxable
\n(c) The entire amount is exempt
\n(d) None of the above. (0)
\n(vii) Income\u00a0arising to a minor married daughter is
\n(a) to be assessed in the hands of the minor married daughter
\n(b) to be clubbed with the\u00a0income\u00a0of that parent whose\u00a0total\u00a0income, before including minor’s\u00a0income, is higher
\n(c) completely exempt from tax
\n(d) to be clubbed with the\u00a0income\u00a0of her husband.
\n(0)
\n(viii) Mr. B incurred short-term capital loss of Rs.10,000 on sale of shares through the National Stock Exchange. Such loss can be set\u2013off \u2013
\n(a) Only against short\u2013term\u00a0capital gains
\n(b) Against both short\u2013term\u00a0capital gains\u00a0and long\u2013term\u00a0capital gains
\n(c) Against any head of\u00a0income
\n(d) None of the above. (0)
\n(ix) Rs.1 lakh is the\u00a0maximum\u00a0qualifying limit for deduction under\u2013
\n(a) section 80C alone
\n(b) section 80C and 80CCC
\n(c) section 80C, 80CCC and 80CCD
\n(d) section 88. (0)
\n(x) A charitable or religious institution is required to file an application for registration \u2013
\n(a) within 1 year from its creation
\n(b) within 30 days from its creation
\n(c) within the financial year of its creation
\n(d) none of the above (0)
\n(b) State whether True\/False with proper reasons of the following statements with regard to provisions of Income\u2013tax Act, 1961: 5×1=5
\n(i) Pension received by recipient of gallantry awards are exempt from income\u2013tax. (0)
\n(ii) Surcharge of 10% on income\u2013tax is payable by an individual where the total income exceeds Rs.7,50,000. (0)
\n(iii) Zero Coupon Bond means a bond on which no payment and benefits are received or receivable before maturity or redemption. (0)
\n(iv) Mr. A, a member of a HUF, received Rs.10,000 as his share from the income of the HUF. The same is to be included in his chargeable income. (0)
\n(v) Subscription to notified bonds of NABARD would qualify for deduction under section 80C. (0)
\n4. Write short notes on any three of the following with reference to the provisions of Income-tax Act, 1961: 3×6=18
\n(a) Explain defective return under section 139(9). (0)
\n(b) What do you understand by \u201cComposite Rent\u201d? What is the tax treatment of Composite Rent under the Income\u2013tax Act, 1961? (0)
\n(c) Explain the term “Business Connection” under section 9(1). (0)
\n(d) Deduction from Gross Total Income under section 80RRB. (0)
\n5. (a) State, with brief reasons, whether the following statements are true or false as per the provisions of Central Sales\u2013tax Act, 1956: 5×2=10
\n(i) Sale includes mortgage or hypothecation of or charge or pledge on goods. (0)
\n(ii) Prosecution on the same facts shall lie under section 10 if a penalty is imposed under section 10A. (0)
\n(iii) Form J is obtained by the selling dealer from his customers in SEZ. (0)
\n(iv) Payment of sales\u2013tax under both laws is a condition precedent for application of refund of local sales\u2013tax. (0)
\n(v) Unmanufactured tobacco and tobacco refuse, cigars and cheroots of tobacco, cigarettes and cigarillos of tobacco and other manufactured tobacco are covered under section 14 as declared goods and can avail concessional tax treatment. (0)
\n(b) Fill in the blanks in the light of the provisions of Central Sales-tax Act: 1×5=5
\n(i) Aviation Turbine fuel sold to aircraft with a maximum take off mass of less than 40,000 kg. operated by scheduled airlines is\u2026\u2026\u2026.(Declared goods\/Undeclared goods). (0)
\n(ii) As per section 6(2), no CST exemption would be available in respect of subsequent sale to\u2026\u2026\u2026(Government\/Registered Dealers). (0)
\n(iii) Ram of Indore sells goods after he received the payment from Shyam of Mumbai. Shyam of Mumbai gets a cash discount. Such cash discount shall be\u2026\u2026\u2026.(deducted\/not deducted) from the sale price. (0)
\n(iv) Indian Airlines purchases Aviation Turbine Fuel for the purpose of its London flight. Such purchase\u2026\u2026\u2026..(shall\/shall not) be the sale in the course of export of goods. (0)
\n(v) Erection and commissioning \u2026\u2026\u2026\u2026(are\/are not) works contract. (0)
\n6. Mr. Sharvil reported undermentioned data for the financial year 2007\u201308:
\nAmount Rs.<\/p>\n
Good worth Rs.87,550 (inclusive of tax) made vide Invoice No. 101\/ACA dated 29.9.2007 were returned on 31.3.2008. 1,01,55,800
\n13,60,000
\n2,30,000
\n8,00,000
\nDetermine the turnover and CST payable assuming the rate of tax at 3%.<\/p>\n","protected":false},"excerpt":{"rendered":"
CA PE II Question Papers \u00a0Group II Income Tax\u00a0and\u00a0Central\u00a0Sales Tax May 2008 This Paper has 37 answerable\u00a0questions\u00a0with 0 answered. Total\u00a0No. of\u00a0Questions\u20146] Time Allowed \u2014 3 Hours Maximum\u00a0Marks \u2014 100 Answers to\u00a0questions\u00a0are to be given only in English except in the cases of candidates who have opted for Hindi medium. If a candidate who … Read more<\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":""},"categories":[4731,120,4930],"tags":[],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/posts\/24517"}],"collection":[{"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/comments?post=24517"}],"version-history":[{"count":0,"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/posts\/24517\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/media?parent=24517"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/categories?post=24517"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.kopykitab.com\/blog\/wp-json\/wp\/v2\/tags?post=24517"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}