CMA Inter Suggested Answers | Dec 25 Paper 07 Direct and Indirect Taxation (DITX)
Table of contents
CMA Inter Dec 25 Suggested Answer Other Subjects Blogs :
(i) Out of the following which one is not a capital receipt under the Income Tax Act, 1961?
(ii) With reference to the Income Tax Act, 1961, Assessment Year refers to
(iii) As per the provisions of the Income Tax Act, 1961, if a domestic servant is engaged by the employer and salary is paid by him, the perquisite is
(iv) Exemption (from the Capital Gain) under Section 54F of the Income Tax Act, 1961, shall not be allowed if the assessee, on the date of transfer, owns
(v) Expenditure on promotion of family planning is an allowance as deduction u/s 36(1)(ix) of the Income Tax Act, 1961 in case of ________.
(vi) Deduction (under old regime) under Section 80G of the Income Tax Act, 1961 in respect of donation to certain funds is available to ________.
(vii) Which among the following is not the difference between direct and indirect taxes?
(viii) As per the GST law, services by an old age home run by Central Government, State Government or entity u/s 12AA of the Income Tax Act, 1961 to residents for consideration up to ________ is exempt, provided that consideration charged is inclusive of charges for boarding, lodging and maintenance.
(ix) Rule 30 of the CGST Rules, 2017 inter alia provides that value of supply of goods or services or both based on cost shall be ________ % of cost of production or manufacture or the cost of acquisition of such goods or the cost of provision of such services.
(x) Under the GST law, Place of Supply of any service when it is provided on board a rail shall be ________.
(xi) Input Tax Credit (ITC) shall not be available if the same is not reflected in ________ of the registered person.
(xii) Where the application for grant of registration has been approved under Rule 9 of the CGST Rules, 2017, Certificate of registration is issued in Form ________.
(xiii) A person opting to pay tax under composition scheme under the GST law needs to file Form CMP-08 ________ and CMP-04 ________.
(xiv) With reference to Customs Act, 1962, what is the limit of Exclusive Economic Zone of India (EEZ) from the baseline?
(xv) As per Section 8B of the Customs Tariff Act, 1975, the total period of levy of safeguard duty is restricted to ________ years.
{{blogads:4}}
Mr. Naresh, aged 35 years, gives the following information to you regarding his incomes:
(i) Rental income (computed) received in a bank account in Germany in respect of a house property situated in Germany: ₹ 2,40,000
(ii) Income from a business controlled from Germany received in India: ₹ 5,00,000
(iii) Agricultural income from a land situated in Sri Lanka received in Sri Lanka: ₹ 6,00,000
(iv) Interest from savings bank account in Germany: ₹ 15,000
(v) Royalty received from BHL Ltd., an Indian company for a product design to be used in Italy, received in German bank account: ₹ 25,00,000
(vi) Capital gains on the sale of shares listed in a recognised stock exchange in India: ₹ 5,40,000
Required:
Compute the gross total income of Mr. Naresh for the Assessment Year 2025-26 assuming he is:
(I) a resident and ordinarily resident,
(II) a non-resident.
Mr. Suresh, a resident individual aged 54 years, is employed as a General Manager with BHNU Ltd., an Indian company. He gives the following information to you regarding the Financial Year 2024-25:
(i) Basic Salary:
From 01/04/2024 – 31/12/2024: ₹ 70,000 p.m.
From 01/01/2025 – 31/03/2025: ₹ 85,000 p.m.
(ii) Dearness Allowance: 50% of the basic salary not forming part of retirement benefits
(iii) Bonus is equal to one month’s basic salary paid in the month of November 2024
(iv) Employer’s Contribution to Recognised Provident Fund: 19% of basic salary.
Mr. Suresh also contributed the same amount.
(v) Profession tax paid: ₹ 10,000, out of which ₹ 5,000 was paid by the employer on behalf of Mr. Suresh
(vi) Facility of laptop provided by the employer for both official and personal use.
The cost of the laptop was ₹ 1,00,000 and it was purchased on 01/04/2022 by the company
(vii) Leave travel concession: ₹ 80,000 for himself, his wife and 3 children aged 3, 7 and 12 years
Required:
Analyze Mr. Suresh’s income chargeable under the head “Salary” for the Assessment Year 2025-26 assuming he did not opt out of default tax regime under Section 115BAC of the Income Tax Act, 1961.
Mrs. Sejal (aged 52 years) is an owner of a residential house property. The particulars of the house for the previous year 2024-25 are as under:
|
Particulars |
Amount (₹) |
|
Municipal value of the property |
1,80,000 |
|
Fair rent |
2,36,000 |
|
Standard rent under the Rent Control Act |
2,20,000 |
|
Rent received |
22,500 per month |
Municipal taxes @ 10% of municipal value was paid by Mrs. Sejal during the year.
The construction of the house began in August, 2017 and was completed on 31st August, 2020. Mrs. Sejal took a loan of ₹ 5,00,000 on 1st September, 2017 for the construction of said property. Mrs. Sejal paid interest on loan @ 15% per annum and every month such interest was paid. The entire loan is outstanding as on 31st March, 2025.
Required:
Analyze the Income from house property chargeable in the hands of Mrs. Sejal for the Assessment Year 2025-26.
Assuming Mrs. Sejal exercises the option of default tax regime provided under Section 115BAC of the Income Tax Act, 1961. Indicate clearly the reasons for treatment of each item.
Mr. Ratan, a resident individual aged 40 years, is engaged in the business of hiring and plying goods vehicle. He gives the following details of his vehicle fleet:
Opening stock of vehicles as on 01/04/2024 as under:
|
Vehicle No. |
Gross weight (in kg) |
Date of Sale |
|
1 |
8,500 |
— |
|
2 |
13,000 |
— |
|
3 |
15,000 |
24/04/2024 |
|
4 |
10,000 |
— |
He bought the following vehicles during the Financial Year 2024-25:
|
Vehicle No. |
Gross weight (in kg) |
Date of purchase and put to use |
|
5 |
7,500 |
01/05/2024 |
|
6 |
8,500 |
01/06/2024 |
During the Financial Year 2024-25, he received ₹ 45 lakhs from the hiring and plying of these vehicles.
Since he did not maintain proper books of account so he want to opt presumptive income scheme under Section 44AE of the Income Tax Act, 1961.
Required:
Assess Mr. Ratan’s income chargeable to tax under the head “Profit and Gains from Business or Profession” for the Assessment Year 2025-26 by briefly explaining the relevant provisions of the Act.
Assume: Mr. Ratan did not opt out from default tax regime under Section 115BAC of the Income Tax Act, 1961.
Mr. Kumar, a 56 years old resident, sold a residential house property on 01-11-2024 for ₹ 28,00,000.
He paid brokerage @ 1% for sale. Value determined for the purpose of stamp duty was ₹ 28,50,000.
The house property was acquired on 20-03-2001 for ₹ 3,35,000.
Fair market value of the house property as on 01-04-2001 was ₹ 3,25,000.
He had constructed a new floor on it at cost of ₹ 2,50,000 on 01-05-2015.
He purchased a new residential house property on 01-09-2024 for ₹ 35,00,000 and commission of ₹ 50,000 was paid to broker.
On 01-03-2025 his diamond ring costing ₹ 1,00,000 purchased on 31-10-2024 was stolen and on 30-03-2025 Insurance claim of ₹ 75,000 was received for this.
Required:
You are required to compute income taxable under the head “Capital Gains” for the Assessment Year 2025-26 of Mr. Kumar assuming he opted for old tax regime.
Cost Inflation Index for the various Financial Years are as under:
2001-02 : 100
2015-16 : 254
2024-25 : 363
Note: No need to give detailed reason (explanations) for your answer.
Mr. Manoj, aged 45 years, submits the information of following transaction/income related to the previous year 2024-25:
|
S. No. |
Particulars |
Amount (₹) |
|
(i) |
Director sitting fees from MNQ Ltd. |
84,000 |
|
(ii) |
Received gold coins from a family friend on the occasion of marriage anniversary on 1st January, 2025. The market value of the gold coins on the said date was ₹ 1,25,000 |
|
|
(iii) |
Interest on debentures of a company listed in a Recognized Stock Exchange (Net of TDS) |
14,400 |
|
(iv) |
Interest on Post Office Saving Bank Account (single account) |
3,000 |
|
(v) |
Interest received on loan given to relative |
6,200 |
|
(vi) |
Rent received from sub-letting a leasehold house property |
1,80,000 |
|
(vii) |
Lease rent paid for sub-let leasehold house property at point no. (vi) |
1,20,000 |
|
(viii) |
Mr. Manoj purchased a piece of land from his friend on 1st August, 2024 for a consideration of ₹ 3,90,000, stamp duty value of such land is ₹ 7,50,000 |
You are required to analyze the income chargeable to tax under the head “Income from other sources” for the Assessment Year 2025-26 in the hands of Mr. Manoj.
Assuming Mr. Manoj exercises the option of shifting out of the default tax regime provided under Section 115BAC of the Income Tax Act, 1961.
Indicate clearly the reasons for treatment of each item.
Mr. Rijwan, a resident individual, aged 56 years, gives you the following particulars about his income for the previous year 2024-25:
(i) Income from salary (Computed as per relevant provisions of the Act): ₹ 6,00,000
(ii) Loss from footwear business: ₹ 1,80,000
(iii) Income from speculative business: ₹ 1,20,000
(iv) Income from owning & maintaining horse races: ₹ 1,00,000
(v) Winning from card games: ₹ 25,000
(vi) Loss from betting: ₹ 20,000
(vii) Income from house property: ₹ 1,15,000
He has brought forward loss from house property ₹ 1,30,000 related to A.Y. 2018-2019 for which belated income tax return was filed.
Required:
(i) Compute the Gross Total Income of Mr. Rijwan for the Assessment Year 2025-26 assuming he has opted for default tax regime provided under Section 115BAC of the Income Tax Act, 1961.
(ii) List out the losses to be carried forward to further assessment years specifying the Assessment Year upto which such losses can be carried forward.
Mrs. Kajal, a resident individual aged 45 years, an employee in a private company furnishes the following particulars of her income for the previous year 2024-25:
|
S. No. |
Particulars |
Amount (₹) |
|
(i) |
Income from salary before standard deduction |
9,20,000 |
|
(ii) |
Interest from Government securities |
5,000 |
She made the following payments:
(I) Deposited ₹ 2,00,000 in her Public Provident Fund (PPF) account by cheque.
(II) Medical insurance premium on own health ₹ 20,000 and on the health of spouse ₹ 10,000 paid by cheque.
(III) Donation towards Prime Minister’s Drought Relief Fund ₹ 10,000 paid by cheque.
You are required to calculate total taxable income and tax liability of Mrs. Kajal for the Assessment Year 2025-26 under the default tax regime under Section 115BAC of the Income Tax Act, 1961 and optional tax regime as per the Regular provisions (old regime) of the Income Tax Act, 1961.
Required:
Advise Mrs. Kajal whether she should pay tax under default tax regime under Section 115BAC of the Income Tax Act, 1961 or Regular provisions (old regime) of the Income Tax Act, 1961.
Note: No need to give detailed reason (explanations) for your answer.
Discuss, in brief, the concept and features of Indirect Taxes
List the five Central and five State taxes that were subsumed in the GST regime and also list any four taxes that were not subsumed in the GST regime.
Mr. Jitesh registered under GST law in the State of Rajasthan provided the details of his turnover to you for the year ended on 31.03.2025:
(i) Value of taxable outward supplies – Intra-state: ₹ 55,00,000
(ii) Value of taxable outward supplies – Inter-state: ₹ 16,00,000
(iii) Value of exempt outward supplies: ₹ 74,00,000
(iv) Amount received as interest on loans and advances (not included in any of the above-mentioned points): ₹ 2,00,000
(v) Value of inward supplies on which tax is payable by him under reverse charge mechanism (RCM): ₹ 8,00,000
(vi) Value of exports (not included in any of the above-mentioned points): ₹ 6,50,000
All the amounts are exclusive of GST.
You are required to analyze the aggregate turnover of Mr. Jitesh for the purpose of opting for Composition scheme under GST law and advise him whether he is eligible to opt for the scheme or not by explaining relevant provisions in brief.
Radhe Shyam & Sons, a registered dealer, furnishes the following information relating to goods sold by it to Ganesh Ltd. in the course of intra-State:
|
S. No. |
Particulars |
Amount (₹) |
|
(i) |
List price of the goods (exclusive of GST and discounts) |
8,50,000 |
|
(ii) |
Subsidy received from Central Government, directly linked to price |
85,000 |
|
(iii) |
Subsidy received from an NGO (non-profit making organisation), directly linked to price |
40,000 |
|
(iv) |
Late fees for delayed payment (Though Ganesh Ltd. made late payment but these charges are waived by Radhe Shyam & Sons) |
8,000 |
|
(v) |
Amount incurred by Ganesh Ltd. for post-delivery inspection charges incurred post receipt of goods by Ganesh Ltd. |
9,000 |
|
(vi) |
Weightiest charges paid to Kartik Ltd. by Ganesh Ltd. on behalf of Radhe Shyam & Sons |
20,000 |
|
(vii) |
Discount of 2% on list price (₹ 8,50,000) of goods was provided and recorded in the invoice |
— |
With reference to GST law, you are required to analyze the value of supply made by Radhe Shyam & Sons.
Items given in point no. (iv) to (vii) are not considered while arriving at the list price of the goods given in point no. (i), but point no. (ii) and (iii) deducted.
Brief notes for treatment given for each item should form part of your answer.
{{blogads:4}}
With reference to Quarterly Return Monthly Payment (QRMP) Scheme under GST law, briefly discuss the following:
(i) Eligibility of QRMP Scheme
(A) In case of New Registration
(B) In case of Others
(ii) Is the QRMP Scheme available GSTIN wise or PAN wise?
With reference to Customs Valuation Rules, state the provisions related to following in case of import of a machine by air from USA:
(i) Freight charges up to airport of importation
(ii) Insurance charges
(iii) Transshipment charges from one airport of India to another airport
(iv) Applicable rate of exchange for conversion purpose
(v) Applicable rate of Basic Customs Duty (BCD)
{{blogads:4}}
Ruchika Saboo
An All India Ranker (AIR 7 - CA Finals, AIR 43 - CA Inter), she is one of those teachers who just loved studying as a student. Aims to bring the same drive in her students.
Ruchika Ma'am has been a meritorious student throughout her student life. She is one of those who did not study from exam point of view or out of fear but because of the fact that she JUST LOVED STUDYING. When she says - love what you study, it has a deeper meaning.
She believes - "When you study, you get wise, you obtain knowledge. A knowledge that helps you in real life, in solving problems, finding opportunities. Implement what you study". She has a huge affinity for the Law Subject in particular and always encourages student to - "STUDY FROM THE BARE ACT, MAKE YOUR OWN INTERPRETATIONS". A rare practice that you will find in her video lectures as well.
She specializes in theory subjects - Law and Auditing.
Yashvardhan Saboo
A Story teller, passionate for simplifying complexities, techie. Perfectionist by heart, he is the founder of - Konceptca.
Yash Sir (As students call him fondly) is not a teacher per se. He is a story teller who specializes in simplifying things, connecting the dots and building a story behind everything he teaches. A firm believer of Real Teaching, according to him - "Real Teaching is not teaching standard methods but giving the power to students to develop his own methods".
He cleared his CA Finals in May 2011 and has been into teaching since. He started teaching CA, CS, 11th, 12th, B.Com, M.Com students in an offline mode until 2016 when Konceptca was launched. One of the pioneers in Online Education, he believes in providing a learning experience which is NEAT, SMOOTH and AFFORDABLE.
He specializes in practical subjects – Accounting, Costing, Taxation, Financial Management. With over 12 years of teaching experience (Online as well as Offline), he SURELY KNOWS IT ALL.
"Koncept perfectly justifies what it sounds, i.e, your concepts are meant to be cleared if you are a Konceptian. My experience with Koncept was amazing. The most striking experience that I went through was the the way Yash sir and Ruchika ma'am taught us in the lectures, making it very interesting and lucid. Another great feature of Koncept is that you get mentor calls which I think drives you to stay motivated and be disciplined. And of course it goes without saying that Yash sir has always been like a friend to me, giving me genuine guidance whenever I was in need. So once again I want to thank Koncept Education for all their efforts."
"Hello everyone, I am Kaushik Prajapati. I recently passed my CA Foundation Dec 23 exam in first attempt, That's possible only of proper guidance given by Yash sir and Ruchika ma'am. Koncept App provide me a video lectures, Notes and best thing about it is question bank. It contains PYP, RTP, MTP with soloution that help me easily score better marks in my exam. I really appericiate to Koncept team and I thankful to Koncept team."
"Hi. My name is Arka Das. I have cleared my CMA Foundation Exam. I cleared my 12th Board Exam from Bengali Medium and I had a very big language problem. Koncept Education has helped me a lot to overcome my language barrier. Their live sessions are really helpful. They have cleared my basic concepts. I think its a phenomenal app."
"I cleared my foundation examination in very first attempt with good marks in practical subject as well as theoretical subject this can be possible only because of koncept Education and the guidance that Yash sir has provide me, Thank you."
