GOODWILL TUITION CENTRE, THEVARA, ERNAKULAM PH 9846710963

No. of Printed Pages : 8 ECO-011

BACHELOR'S DEGREE PROGRAMME

Term-End Examination
June, 2017
0000I

(ELECTIVE COURSE : COMMERCE)

ECO-011 : ELEMENTS OF INCOME TAX

Time : 2 hours Maximum Marks : 50

Note : Question no 1 is compulsory. Attempt any three

questions from the remaining questions.

1. On the basis of the following information,

compute the taxable income of Mr. Saurabh
under the head 'Salaries' for the assessment
year 2017-18 : 14
(p.m.)

(i) Basic Pay 40,000

(ii) Dearness Pay 11,000

(iii) Dearness Allowance 13,000

(iv) Entertainment Allowance 2,800

(v) Hill Area Allowance 1,450

(vi) Tribal Area Allowance 750

(vii) Own contribution towards

Statutory Provident Fund 12,500
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 (viii) Employer's contribution in
Provident Fund excess of 12%
of salary 12,500
(ix) Interest credited to Provident
Fund in whole year @ 13% 16,500
(x) House Rent Allowance of
whole year 29,600
Mr. Saurabh is an officer of the Forest
Department of the Government of UP. He is
employed at a place at the height of
1,100 metres above sea level. He is paying
2,800 p.m. as house rent.

2. Define the term 'perquisites' with examples.

Explain the method of valuation of furnished
rent free accommodation provided by the
employer to a non-government employee. 4+8

3. (a) Define annual value and state the

deductions that are allowed from the
annual value in computing the income from
house property.
(b) From the following information, compute the
annual value of a house : 6+6

Municipal Value (M.V.) 1,50,000

Fair Rent 1,80,000
Standard Rent 1,60,000
Actual Rent 20,000 (p.m.)
Municipal Tax paid
by the owner 20% of M.V.
Unrealised Rent 40,000
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GOODWILL TUITION CENTRE, THEVARA, ERNAKULAM PH 9846710963

 4. (a) Define the term 'capital assets' as per
Section 2(14) of the Income Tax Act and state
the assets that are not included therein.

(b) Shri Mahesh Joshi has a house which is let

out for residential purpose. He had
purchased this house for 66,500 in
1987 — 88. He sold this house on
15th June, 2014 for 5,70,000. He had
purchased some jewellery in 1987 — 88 for
73,150. On 22nd February, 2015 he sold
this jewellery for 6,28,000. You have to
determine the taxable capital gains of Shri
Mahesh for the assessment year 2015 — 16.
Cost inflation index are as follows :
1987 — 88 = 150, 2014 — 15 = 1024. 8+4

5. (a) Calculate income from other sources for the

assessment year 2017 — 18 from the
information given below :
I. Winnings from lottery 1,00,000
II. Amount received from
horse race winnings 35,000
III. Gift received :
(i) Received 20,000 as gift from
his friend
(ii) Received 1,00,000 as gift from
his elder brother

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GOODWILL TUITION CENTRE, THEVARA, ERNAKULAM PH 9846710963

 (iii) Received 1,40,000 as gift on
his marriage
(iv) Received 80,000 as gift from
his NRI friend
(v) Another gift of 18,000
received from his friend

(b) Explain the rule regarding grossing up of

interest on tax-free commercial securities. 8+4

6. Write short notes on any two of the following : 2x6=12

(a) Casual Income

(b) Partly Agricultural Income

(c) Exemption regarding Children Education

and Hostel Allowance

(d) Bond Washing Transaction

GOODWILL TUITION CENTRE, THEVARA, ERNAKULAM PH 9846710963

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