Alagappa University 2008 Diploma Accounting & Finance ELEMENTS OF TAXATION — II - Question Paper

DISTANCE EDUCATION
DIPLOMA IN ACCOUNTING AND TAXATION EXAMINATION, MAY 2008.
ELEMENTS OF TAXATION — II

Time : 3 hours Maximum : 100 marks
PART A — (5 x eight = 40 marks)
ans any 5 ques. in about 200 words every.

1.Define ‘dividend’. Also explain chargeability of various kinds of dividend.
2.Write a note on ‘‘Capital Assets’’ and ‘‘transfer’’.
3.Distinguish ranging from ‘‘Short term capital gain’’ and ‘‘Long term capital gain’’.
4.Briefly discuss the kinds of provident fund.
5.What is Central Sales Tax Appellate Authority?
6.Explain the significance of ‘Form C’ and ‘Form D’ in CST Act.
7.What is SSI unit as per Central Excise?
8.Briefly discuss the ‘Drawback Duties’ under custom act.

PART B — (4 x 15 = 60 marks)
ans any 4 of the subsequent in about 400 words every.

9.Given beneath is the profit and loss account of Shri Anand Reddy for the year ended 31.3.2006 :
Dr Rs. Cr Rs.
To salaries 7,000 By Gross profit 50,000
To Drawings 8,000 By interest on post
To insurance premium office savings bank a/c 100
on his life 1,000 By proceeds from life
To Depreciation 4,500 insurance policy 6,900
To donations to the By interest on bank
recognised institutions 500 deposits 3,600
To general expenses 2,600
To education expenditure
on his 3 dependent
sons in England 6,600
To provisions for
doubtful debts 1,500
To income-tax 2,000
To rent 1,700
To net profit 25,200
60,600 60,600
calculate his taxable income for current assessment year after taking the subsequent info into consideration.
(a)The amount of depreciation allowance is Rs. 4,000
(b)General expenses include Rs. 600 for his private expenses.
10.An assessee had the subsequent investments as on first April, 2005
(a) Rs. 40,000, 12% Central Government loan;
(b) Rs. 30,000, 10% government securities;
(c) Rs. 20,000, 9% preference shares of paper will company;
(d) Rs. 50,000, 10% Bombay Port Trust Bonds;
(e) Rs. 20,000, 11% debentures of a limited company (unlisted);
(f) Rs. 10,000, 10% securities issued by government of England;
(g) Rs. 10,000, 10% 10-year National plan certificates;
(h) Rs. 20,000, 14% municipal debentures;
(i) Interest accrued on NSC VIII problem purchased on 11.3.2005, Rs. 1,130; Rs. 15,920, 10% (tax free) debentures of a limited company (unlisted)
On first September, 2005 he bought Rs. 50,000, 12% Maharashtra Govt. Bonds for Rs. 60,000 the interest on which is payable on 30th June and 31st December. For this purpose he took a loan from his bankers for Rs. 40,000 @ 15% p.a. and the balance of Rs. 20,000 were financed out of a previous loan taken for purchase of a motor car @ 9% p.a. Bank charged 2% of interest and dividend as collection charges and 3% commission on purchase of securities.
compute the income from other sources.
11.(a)Mr. Avtar Singh purchased a plot in 1986-87 for Rs. 2,00,000 and it was sold on 15.1.2006 for Rs. 12,80,000. He paid Rs. 20,000 as brokerage charges. He invested Rs. 2,00,000 in bonds issued by NABARD bonds on 31.3.2006 and Rs. 3,10,000 in bonds issued by rural electrification corporation on 1.8.2006.
calculate the taxable amount of capital gain if CII for 1986-87 is 140 and for 2005–06 is 497.
(b)(i)Sales price of jewellery in Oct 2005 (CII : 497) – Rs. 20,00,000
(ii)Cost of acquisition in 1983-84 (CII : 116)
(iii)Amount invested in construction of new house upto 31.7.2006 – Rs. 4,00,000
(iv)Amount deposited in capital gain deposit scheme for completing the construction of house (Deposited on 27.6.2006) Rs. 12,00,000
calculate the taxable capital gain assuming that he does not own any other house. calculate deemed capital gain if he is able to invest only Rs. 10,00,000 out of amount deposited in capital gain deposit scheme.
12.Discuss the exemptions given by parts 54 and 54 F.
13.Describe the different kinds of custom duty.
14.Explain briefly the rules under TNGST Act 1959.
15.Explain in detail relating to inter-state sales and intra state sales under the CST Act 1956.

Earning:   Approval pending.