|To Administrative expenses||4,30,000||By Gross Profit||58,30,000|
|To Salaried & wages,||20,00,000||By Profit on sale of asset of scientific research||2,00,000|
|To Interest on loans||7,50,000||By Winning from lottery (Net of TDS @30%)||31,500|
|To Professional fees||2,70,000|
|To Rent, rates & taxes||2,80,000|
|To Travelling & conveyance||1,40,000|
|To Net Profit ||15,74,500|
(i) Opening and closing stock of finished goods were undervalued by 10%. Opening stock of Rs. 4,50,000 and Closing stock of Rs. 5,58,000 was shown.
(ii) Salaries & wages include following items:
(a) Contributed 20% of basic salary in National Pension Scheme referred to section 80CCD regarding salary paid to an employee Mr. Ganesh who has withdrawn basic salary of Rs. 3,00,000, and Dearness allowance is 40% of basic salary. 50% of Dearness allowance forms part of the salary.
(b) Some of the employees opted for retirement under the voluntary retirement scheme; a sum of Rs. 2,40,000 was paid to them on 1st January, 2021.
(iii) Interest on loan includes interest paid @ 15% per annum on loan of Rs. 12,00,000 which was taken from State Bank of India on 01.05.2020 for purchase of new electric car of Rs. 15,00,000. The car is used for personal purpose.
(iv) Depreciation allowable as per Income Tax Rules, 1962 is Rs. 4,50,000 but during the calculation of such depreciation following addition was not considered:
Motor car purchased for Rs. 3,00,000 for supply of finished goods to dealers on 25-08-2020.
(v) An asset was purchased for Rs. 6,00,000 on 17-11-19 for conducting scientific research and the deduction was claimed under section 35 of the Income-tax Act, 1961. This asset was sold on 05-09-2020 for a consideration of Rs. 8,00,000.
A plot of Industrial land which was used by Mr. Shivansh for business purpose for last 10 years was compulsorily acquired by Central Government on 07.05.2020. The compensation of Rs. 12,00,000 was received on 27.02.2021. Such property was purchased by him on 08.08.2005 for Rs. 2,00,000. He has purchased another plot of industrial land on 21.04.2021 for Rs. 6,00,000. Government has also paid Rs. 54,000 as interest on such compensation on 28.03.2021.
Cost Inflation Indices: FY 2020-21: 301, FY 2005-06: 117
Compute the total income and tax liability of Mr. Shivansh for the assessment year 2021-22 assuming that he has not opted provisions of section 115BAC. Ignore Provisions relating to AMT.
ICAI CA Inter Dec 2021 Question 2 (a)
Examine the tax implications of the following transactions for the assessment year 2021-22: (Give brief reason)
(i) Government of India has appointed Mr. Rahul as an ambassador in Japan. He received salary of Rs. 7,50,000 and allowances of Rs. 2,40,000 during the previous year 2020-21 for rendering his services in Japan. He is an Indian citizen having status of non-resident in India for the previous year 2020-21.
(ii) Ms. Juhi, a non-resident in India is engaged in operations which are confined to purchase of goods in India for the purpose of export. She has earned Rs. 2,50,000 during the previous year 2020-21.
(iii) Mr. Naveen, a non-resident in India, has earned Rs. 3,00,000 as royalty for a patent right made available to Mr. Rakesh who is also a non-resident. Mr. Rakesh has utilized patent rights for development of a product in India and 50% royalty is received in India and 50% outside India.
(iv) Mr. James, a NRI, borrowed Rs. 10,00,000 on 01.04.2020 from Mr. Akash who is also non-resident and invested such money in the shares of an India Company. Mr. Akash has received interest 12% per annum.
ICAI CA Inter Dec 2021 Question 2 (b)
Ms. Mishik has entered into an agreement with M/s CVM Build Limited on 25.04.2017 in which she agrees to allow such Company to develop a shopping mall on land owned by her in New Delhi. She purchased such land on 05.05.2009 in Rs. 15,00,000. In Consideration, M/s CVM Build Limited will provide 20% share in shopping mall to Mishika. The certificate of completion of shopping mall was issued by authority as on 26.12.2020. On such date, Stamp duty value of shopping mall was Rs. 4,14,00,000. Subsequently on 18.03.2021, she sold her 15% share in shopping mall to Mr. Ketav in consideration of Rs. 65,00,000
She has also purchased a house on 09.05.2020 in consideration of Rs. 46,00,000 and occupied for own residence. Punjab National Bank has sanctioned a loan of Rs. 35,50,000 (80% of stamp value) at the interest rate of 12% per annum on 01.05.2020 and disbursement was made on 01.06.2020. She does not own any other residential house on the date of sanction of loan. Principal amount of Rs. 1,30,000 was paid during the financial year 2020-21.
Cost Inflation Indices: 2020-21: 301, 2009-10: 148
Compute total income of Ms. Mishika for the assessment year 2021-22 assuming that she has not opted provisions under section 115BAC.
ICAI CA Inter Dec 2021 Question 3 (a)
State in brief the applicability of provisions of tax deduction at source, the rate and amount of tax deduction in the following cases for the financial year 2020-21 under Income Tax Act, 1961. Assume that all payments are made to residents:
(i) Mr. Mahesh has paid Rs. 6,00,000 on 15.10.2020 to M/s Fresh Cold Storage Pvt. Ltd. for preservation of fruits and vegetables. He is engaged in the wholesale business of fruits & vegetable in India having turnover of Rs. 3 Crores during the previous year 2019-20.
(ii) Mr. Ramu, a salaried individual, has paid rent of Rs. 60,000 per month to Mr. Shiv Kumar from 1st July, 2020 to 31st March, 2021. Mr. Shiv Kumar has not furnished his Permanent Account Number.
ICAI CA Inter Dec 2021 Question 3 (b)
Examine the following transactions with reference to applicability of the provision of tax collected at source and the rate and amount of the TCS for the Assessment year 2021-22.
(i) Mr. Kalpit bought an overseas tour programme package for Singapore for himself and his family of Rs. 5 lakhs on 01-11-2020 from an agent who is engaged in organising foreign tours in course of his business. He made the payment by an account payee cheque and provided the permanent account number to the seller. Assuming Kalpit is not liable to deduct tax at source under any other provisions of the Act.
(ii) Mr. Anu doing business of textile as a proprietor. His turnover in the business is 11 crores in the previous year 2019-20. He received payment against sale of textile goods from Mr. Ram Rs. 75 lakhs against the sales made to him in the previous year and proceeding previous yeaRs. (Assuming all the sales are domestic sales and Mr. Ram is neither liable to deduct tax on the purchase from Mr. Anu nor he deducted any tax at source).
ICAI CA Inter Dec 2021 Question 3 (c)
Mr. Ravi, a resident and ordinarily resident in India, owns a let out house property having different flats in Kanpur which has municipal value Rs. 27,00,000 and standard rent of Rs. 29,80,000. Market rent of similar property is Rs. 30,00,000. Annual rent was Rs. 40,00,000 which includes Rs. 10,00,000 pertaining to different amenities provided in the building. One flat in the property (annual rent is Rs. 2,40,000) remains vacant for 4 months during the previous year. He has incurred following expenses in respect of aforesaid property:
Municipal taxes of Rs. 4,00,000 for the financial year 2020-21 (10% rebate is obtained for payment before due date.) Arrears of municipal tax of financial year 2019-20 paid during the year of Rs. 1,40,000 which includes interest on arrears of Rs. 25,000.
Lift maintenance expenses of Rs. 2,40,000 which includes a payment of Rs. 30,000 which made in cash.
Salary of Rs. 88,000 paid to staff for collecting house rent and other Charges.
Compute the total income of Mr. Ravi for the assessment year 2021-22 assuming that Mr. Ravi has not opted provisions under section 115BAC.
ICAI CA Inter Dec 2021 Question 4 (a)
Details of Income of Mr. R and his wife MRs. R for the previous year 2020-21 are as under:
(i) Mr. R transferred his self-occupied property without any consideration to the HUF of which he is a member. During the previous year 2020-21 the HUF earned an income of Rs. 50,000 from such property.
(ii) Mr. R transferred Rs. 4,00,000 to his wife MRs. R on 01.04.2006 without any consideration which was given as a loan by her to Mr. Girish. She earned Rs. 3,50,000 as interest during the earlier previous years which was also given as a loan to Mr. Girish. During the previous year 2020-21, she earned interest @ 11% per annuam.
(iii) Mr. R and Mrs. R both hold equity shares of 27% and 25% respectively in AMG Limited. They are also working as employees in such Company. During the financial year 2020-21 they have withdrawn a salary of Rs. 3,20,000 and 2,70,000 respectively.
(iv) Mrs. R transferred 5,000 equity shares of RSB Ltd. on 17.09.2013 to Mr. R without any consideration. The Company issued 3,000 bonus shares to Mr. R in 2016. On 04.03.2021, Mr. R sold entire share holdings and earned Rs. 5,20,000 as capital gains.
Apart from above income, Mr. R has income from commission Rs. 4,00,000 and Mrs. R has interest income of Rs. 3,30,000. Compute Gross Total income of Mr. R and Mrs. R for the assessment year 2021-22.
ICAI CA Inter Dec 2021 Question 4 (b)
|Sr.NO.||Particulars||Amount (excluding GST) Rs.|
|1||The company had given on hire 5 trucks to one of the transporters of Vadodara (a goods transport agency) for transporting goods for 10 days. The hiring charges for the trucks were Rs. 7,500 per truck per day||3,75,000|
|2||The company sold goods to X & Co. of Delhi on 6th January 2021 with a condition that interest @ 2% per month will be charged on invoice value if X & Co. failed to make payment within 30 days of the delivery of the goods. Goods were delivered and also the invoice was issued on 6th January 2021. X & Co. paid the consideration for the goods on 20th February along with applicable inter.||5,00,000|
|3||The company sought legal consultancy services for it's business from A & Advocates, a partnership firm of advocates situated at Bhuj, Gujarat.||1,50,000|
|4||The company ordered 3,000 packets of tools which are to be delivered by the supplier of Delhi via 3 lots of 1,000 packets monthly. The supplier raised the invoice for full quantity in February 2021 and the last lot would be delivered in April 2021.||5,00,000|
|5||The company supplied 10,000 packets of tools to one of it’s customer at Rs. 10/- per packet in Gujarat in January 2021. Afterwards, the company re-values it at Rs. 9 per packet in February 2021 and the company issued credit note to the customer for Rs. 1 per packet.|
|Services of transportation of students, faculty and staff from home to college and back to Commerce College, (a private college) providing degree courses in BBA, MBA, B.Com., M.Com||2,50,000|
|Online monthly magazine containing question bank and latest updates in law to students of PQR Law college offering degree course in LLB and LLM||1,00,000|
|Housekeeping services to T Coaching Institute||50,000|
|Security services to N Higher Secondary School||3,25,000|
|Services of providing breakfast, lunch and dinner to students of ABC Medical College offering degree courses recognized by law in medical|
(ii) What is the threshold limit for mandatory issuing of E-invoice for all registered businesses?
(iii) A consignor hands over his goods for transportation on a Friday to the transporter. However, assigned transporter starts the movement of goods from consigner’s warehouse to its depot located at distance of 600 Km. on Monday.
When will the e-way bill be generated and for how many days it will be valid?
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