+3 Sem-V

ILP-DSC-XII(H)OC
Dec,2023
Income Tax Law and Practice
Time: 3 Hours Full Mark: 80
Answer all questions

1. Answer all questions : [20x1]

(a) A person who pays tax on income earned under Income Tax Act is
(i) An Assessee ii) A client iii) A debtor iv) A creditor
(b)The year in which income is earned is called
(i) Previous year ii) Current year iii) Assessment year iv) None of these
(c) An Indian company is said to be ___________________ in India.
(i) Resident ii) Non-resident iii) Not –ordinarily resident iv) None of these
(d)Income accruing in India but received outside India IS taxable in respect of
(i) Only resident assesses iii) Only non-resident assessees
(ii) All type of assesses iv) None of these
(e) Perquisites received by a Government employee posted outside India is
(i) Fully taxable ii) Fully exempted iii) Taxable in excess of Rs. 50,000
iv) Taxable as other source of income
(f) Employer’s contribution to Recognised Provident Fund of the employee is exempted
upto_______of salary.
(i) 9.5% ii) 12% iii) 12.5% iv) 50%
(g)Children’s Education Allowance is exempted up to ______________ per child.
(i) Rs.500 p.m. ii) Rs.300 p.m. iii) Rs.200 p.m. iv) Rs.100 p.m.
(h)The basis of charge for tax on income from house property is
(i) Annual value ii) Rental value iii) Municipal value iv) Market value
(i) Standard deduction under section 24 is___________.
(i) ¼ of NAV ii) 1/5 of NAV iii) 30% of NAV iv) Rs. 10,000
(j) Bad debt allowed earlier in respect of business but recovered later is
(i) Exempt ii) Taxable as casual income iii) Taxable as business income
iv) Taxable as other source
(k)Preliminary expenses shall be allowed as deduction in
(i) 10 installments ii) 12 Installments iii) 5 installments iv) None of these
(l) Rate of depreciation allowable under Income Tax Act, on computer is _________.
(i) 15% ii) 100% iii) 40% iv) 25%
(m) Unabsorbed depreciation can be carried forward for_____________.
(i) 16 years ii) 8 succeeding years iii) Indefinite period iv) None of these.

1
(n)Listed shares held for less than 12 months are________________.
(i) Long term capital assets iii) Exempted capital assets
(ii) Short term capital assets iv) None of these
(o)Exemption under section 54 is allowed for investment in _______________.
(i) A residential house ii) Land iii) Shares iv) Jewellery
(p)Which of the following income from other sources is not taxable?
(i) Dividend from cooperative society iii) Winning from lottery
(ii) Gift from relatives iv) Dividend from foreign company
(q)Deduction under section 80E is allowed for ________________.
(i) Interest on loan for residential house property iii) Purchase of an electric vehicle
(ii) Interest on loan taken for studies iv) None of these.
(r) Deduction for approved donations is allowed under section-I
(i) 80G ii) 80GGA iii) 80GGB iv) 80GGC
(s) The total income is rounded off to the nearest multiple of
(i) Re.1 ii) Rs.10 iii) Rs.100 iv) Rs.1,000
(t) The whole life notified limit of exemption on gratuity is
(i) Rs.10,00,000 ii) Rs.20,00,000 iii) Rs.30,00,000 iv) Rs.40,00,000

2. Answer any eight questions : [ 8x2]

(a) Define Person
(b) What do mean by Assessment year?
(c) Name the persons who enjoy the status of Not Ordinarily Resident.
(d) What components are included in salary for the calculation of taxable part of Provident
Fund?
(e) What is the qualifying amount for deduction under section 80C?
(f) Define Annual Value.
(g) How will you treat the Rent received from the sub-letting?
(h) Name two business expenses which are expressly disallowed.
(i) What is unabsorbed depreciation?
(j) How many years a speculation loss can be carried forward.
3. Answer any eight questions : [8x3]
(a) Discuss in brief about Assessee-in-default.
(b) Write the situations when House Rent Allowance is fully taxable.
(c) Write about the treatment of Entertainment allowance received by a Govt. employee.
(d) Distinguish between Salary Received in Advance and Advance Salary.
(e) Explain in short about the treatment of Unrealised Rent.
(f) Give three examples of Deemed Profit.
(g) Write the provision of deduction u/s 80GG in respect of expenditure incurred on payment
of house rent.
(h) Explain the method of calculation of Long Term Capital gain.

2
 (i) Explain the treatment of commuted pension received by a non-govt. employee.
(j) How would you integrate Agricultural income with Non Agricultural income?
4. Answer any two questions : [2x10]
(a) What are the different categories of assessees according to their residential status? How
would you determine the residential status of an individual?
(b) Define Annual Value. Discuss the procedure of determining Annual Value.
(c) From the particulars given below, compute the income under the head salary of Mr.
Pushparaj who is working in a private company at Bhubaneswar(Population 11,94,000)
(i) Basic salary Rs.25,000 p.m.
(ii) Dearness allowance Rs. 5,000 p.m.(50% enters)
(iii) Bonus Rs.20,000.
(iv) Entertainment allowance Rs.2,500 p.m.
(v) Furnished house at concessional rent of Rs.3,000 p.m. Cost of furnishing
Rs.2,50,000.
(vi) Contribution by employee and employer to R.P.F.-13% each of salary.
(vii) Life Insurance Premium paid by employee Rs.45,000.
(viii) Contribution to P.P.F. Rs.25,000.

(d) Ms. Srivalli purchased a residential house during the previous year 2001-02 for Rs.40
lakhs and sold it for Rs. 2 crores during the previous year 2020-21. She purchased two
houses worth Rs. 38 lakhs each on February 21, 2021. Calculate the taxable capital gain
u/s 54 for the assessment year 2021-22 if the Cost Inflation Index for the financial year
2001-02 and 2020-21 are 100 and 301 respectively.

*****