QUESTION BANK – LONG ANSWER QUESTION TYPE
Course Code UCM23602J
Course Name INCOME TAX LAW AND PRACTICE– II Courser Teacher- G.VINCENT
QUESTION BANK – LONG
ANSWER QUESTION TYPE
UNIT 2 INCOME
FROM OTHER SOURCE
EXCERCISE
PROBLEMS AND SOLUTIONS (T.S.REDDY &
PRASAD REDDY, MARGAM PUBLICATIONS)
EX.55. Calculate income from other source from the
following details:
|
|
Rs. |
|
i.
Income from agricultural land in Burma ii.
Income from agricultural land
in Kerala iii.
Interest on fixed deposits in Indian Bank iv.
Interest on post office saving
bank a/c v.
Dividends from cooperative societies vi.
Director’s fees vii.
Net winnings from Manipur
lotteries viii.
Advance money received from forfeited during negotiations to sell a
capital assets: Rs.60,000 during 2024-25. |
3,60,000 1,80,000 16,200 13,500 12,000 54,000 4,20,000 |
Solution:
Computation of Income From Other Sources of Mr.Kabilan for A.Y.2025-26
|
1 |
Income
from agricultural land in Burma |
|
3,60,000 |
|
2 |
Income
from agricultural land in Kerala |
|
NIL |
|
3 |
Interest
on fixed deposits in Indian Bank |
|
16,200 |
|
4 |
Interest
on post office saving bank a/c Less :
Exempt from tax |
13,500 3,500 |
10,000 |
|
5 |
Dividends
from cooperative societies |
|
12,000 |
|
6 |
Director’s
fees |
|
54,000 |
|
7 |
Net
winnings from Manipur lotteries (4,20,000x100/70) |
|
6,00,000 |
|
8 |
Advance
money received from forfeited |
|
60,000 |
|
|
Total Income From Other Sources |
|
11,12,200 |
EX.56. Calculate income from other source from the
following details:
|
|
Rs. |
|
i.
Dividend on equity shares ii.
Dividend on preference shares iii.
Income from letting of building and machinery iv.
Interest on bank deposits v.
Director’s fees vi.
Ground rent vii.
Undisclosed income viii.
Lottey income (Gross) ix.
Advance money received from forfeited during negotiations to sell a
capital assets: Rs.70,000 during 2024-25. During
2024-25, he claims the following deductions Depeciation
on building:Rs.4,000; Insurance on Machinery:Rs.100 |
600 3,200 17,000 2,500 1,200 600 10,000 10,000 |
Solution:
Computation of Income from Other Sources of Ms.Archana for A.Y.2025-26
|
|
|
Rs. |
Rs. |
|
1 |
Dividend
on equity shares |
|
600 |
|
2 |
Dividend
on preference shares |
|
3,200 |
|
3 |
Income
from letting of building and machinery Less:
Depreciation & Insurance- |
17,000 4,100 |
12,900 |
|
4 |
Interest
on bank deposits |
|
2,500 |
|
5 |
Director’s
fees |
|
1,200 |
|
6 |
Ground
rent |
|
600 |
|
7 |
Undisclosed
income |
|
10,000 |
|
8 |
Lottey
income (Gross) |
|
10,000 |
|
9 |
Advance
money received from forfeited during negotiations to sell a capital assets:
Rs.70,000 during 2024-25. |
|
70,000 |
|
|
Total Income From Other Sources |
|
1,11,000 |
EX.57. Calculate income from other source of Vignesh
from the following details:
|
|
Rs. |
|
i.
Director’s Fees ii.
Income from agricultural land in Sri Lanka iii.
Ground rent for land in Mysore iv.
Interest on post office saving bank a/c v.
Interest on deposit with IDFC vi.
Dividend from foreign company vii.
Rent from house (sub-let) viii.
Rent paid by Mr.Vignesh(on the sub-let house) ix.
Winnings from Horse race x.
Interest on securities |
2,000 5,000 10,000 100 500 700 26,250 13,000 12,300 4,000 |
Solution:
Computation of Income from Other Sources of Ms.Archana for A.Y.2025-26
|
|
|
Rs. |
Rs. |
|
1 |
Director’s Fees |
|
2,000 |
|
2 |
Income from agricultural land in Sri Lanka |
|
5,000 |
|
3 |
Ground rent for land in Mysore |
|
10,000 |
|
4 |
Interest on post office saving bank a/c(exempt upto Rs.3,500) |
|
Nil |
|
5 |
Interest on deposit with IDFC |
|
500 |
|
6 |
Dividend from foreign company |
|
700 |
|
7 |
Rent from house (sub-let) |
26,250 |
|
|
8 |
Rent paid by Mr.Vignesh(on the sub-let house) |
13,000 |
13,250 |
|
9 |
Winnings from Horse race |
|
12,300 |
|
|
Interest
on securities |
|
4,000 |
|
|
Total Income From Other Sources |
|
57,750 |
Ex:66.
From the following investments and other income of Mr.Aswin,compute income from
other sources.
|
|
|
i.
Rs.31,840,10% tax free commercial securities ii.
Rs.6,286 received as interest on tax-free Public Ltd., Co., securities
(listed) iii.
Rs.3,592 received as interest on Deepak Fertiliser(listed) iv.
Dividend received Rs.9,000 (net) from Indian company v.
Amount received from Karnataka Lottery Prize Rs34,700 vi.
Directors’ fees received Rs.4,000 vii.
Royalty income by writing books Rs.40,000(Expensed claimed allowed
Rs.40,000) viii.
Family Pension received |
Solution:
Computation of Income from Other Sources of Mr.Aswin for A.Y.2025-26
|
|
|
Rs. |
Rs. |
|
1 |
10% tax free
commercial securities(always grossed up) |
(31,840x10/100 |
3,438 |
|
2 |
Interest on
tax free Public Ltd.,securities |
|
6,984 |
|
3 |
Interest on
Deepak Securities |
|
3,991 |
|
4 |
Dividend
received from Indian company(9,000/90)x100 |
|
10,000 |
|
5 |
Amount
received from Lotter(Net) 34,700/70x100 |
|
49,571 |
|
6 |
Director’s
fees |
|
4,000 |
|
7 |
Royalty
Received from witting books Less:
Expenses |
40,000 4,000 |
36,000 |
|
8 |
Family
Pension Less:
Deduction Rs.15,000 1/3 of 36,000=
12,000 which is less |
36,000 12,000 |
24,000 |
|
|
Total Income
from Other Sources |
|
1,38,084 |
INTEREST ON SECURITIES
Ex.36. Mr.Jayashankar’s
investments during the year ended 31st March,2025 consisted of the
following:
a)
Rs.25, 000, 7% Government Securities.
b)
Rs.15, 000, 8% Agra Municipal Bonds
c)
Rs.10,000, 7 years Post Office National Savings Certificates
d)
Rs.10,000, 6% securities issued by a Foreign Government.
Find out income
from other sources.
|
|
|
Rs. |
Rs. |
|
1 |
7% Government
securities (25,000x7/100) |
|
1,750 |
|
2 |
8% Agra
Municipal Bonds ( 15,000x8/100) |
|
1,200 |
|
3 |
Post office
Deposits |
|
Nil
|
|
4 |
6% Securities
by Foreign Government |
|
600 |
|
|
Total Income From Other Sources |
|
3,550 |
UNIT 3 SET OFF AND CARRY FORWARD
SET
OFF EXCERSICE PROBLEMS
Ex:1 Following
are the particulars of income of Mr. for the previous year ended 31st
March, 2025.
|
|
|
|
|
1. |
Dividend |
20,000 |
|
2. |
Loss from
House property |
32,000 |
|
3. |
Interest
from bank deposits |
10,000 |
|
4. |
Business
Income |
50,000 |
|
5. |
Loss in
speculative business |
3,000 |
|
6. |
Short
term capital loss |
10,000 |
|
7. |
Long term
capital gain |
15,000 |
Compute the
gross total income of Mr.R after setting off the different losses against other
income.
Solution
Step 1 :Intra head or Inter –Source Adjustment
|
|
|
|
|
|
1. |
Dividend |
|
20,000 |
|
2. |
Loss from
House property- to be set off |
32,000 |
|
|
3. |
Interest
from bank deposits |
|
10,000 |
|
4. |
Business
Income |
|
50,000 |
|
5. |
Loss in
speculative business- C/F |
3,000 |
|
|
6. |
Short
term capital loss |
10,000 |
|
|
7. |
Long term
capital gain |
15,000 |
5,000 |
STEP 2 INTER –HEAD ADJUSTMENT
Calculation of Gross Total
Income
|
|
|
|
|
|
1. |
Dividend |
|
20,000 |
|
2. |
Business
Income |
50,000 |
|
|
3. |
Less: HP
income |
32,000 |
18,000 |
|
4. |
Interest
from bank deposits |
|
10,000 |
|
5. |
Capital
Gain |
|
5,000 |
|
6. |
GROSS TOTAL INCOME |
|
53,000 |
|
|
CARRY
FORWARD LOSS |
|
|
|
|
Speculation
loss |
3,000 |
|
Ex:2 Mr. Bala, a
resident individual submits the following informations relevant for the P.Y
ending 31-03-2025.
|
|
|
Rs. |
|
1 |
Income from Salary (Computed) |
80,000 |
|
2. |
Income from House property(Computed) House 1 House 2 House 3 |
25,000 -35,000 -40,000 |
|
3. |
Profit and gains from Business Business 1 Business 2 Business 3 (speculation) Business 4 (speculation) |
30,000 -70,000 -44,000 15,000 |
|
4. |
Capital Gains STCL LTCG |
-65,000 17.000 |
|
5. |
Income from other sources Interest on securities Race winnings Income from card games and betting |
30,000 45,000 70,000 |
Determine the
income of Mr. bala for A.Y.2025-26.
SOLUTION
STEP 1: INTRA-HEAD OR INTER-SOURCE ADJUSTMENT
|
|
|
|
Rs. |
|
1 |
Income from Salary (Computed) |
|
80,000 |
|
2. |
Income from House property(Computed) House 1 House 2 House 3 |
25,000 -35,000 -40,000 |
|
|
|
To be adjusted
with other heads |
-50,000 |
|
|
3. |
Profit and gains from Business Business 1 Business 2 |
30,000 -70,000 |
|
|
|
To be adjusted
with other heads |
-40,000 |
|
|
|
Business 3 (speculation) Business 4 (speculation) |
-44,000 15,000 |
|
|
|
Carry forward(C/F) |
-29,000 |
|
|
4. |
Capital Gains STCL LTCG |
-65,000 17.000 |
|
|
|
Carry forward(C/F) |
-48,000 |
|
|
5. |
Income from other sources Interest on securities Race winnings Income from card games and betting |
|
30,000 45,000 70,000 |
STEP 2: INTER –HEAD ADJUSTMENT
Calculation of Gross Total
Income
|
|
|
|
Rs. |
|
1 |
Income from Salary (Computed) |
80,000 |
|
|
2. |
Loss from House property |
50,000 |
30,000 |
|
3. |
Income from other sources Interest on securities Less: Business loss |
30,000 40,000 |
|
|
|
Carry forward |
-10,000 |
|
|
|
|
|
|
|
|
|
|
|
|
4. |
Race winnings Income from card games and betting |
|
45,000 70,000 |
|
|
GROSS TOTAL INCOME |
|
1,45,000 |
|
5. |
CARRY FORWARD
Business loss Speculation loss |
10,000 48,000 |
|
Ex.3 Mr.Ram
Patel submits the following information relevant for the P.Y ending 31-03-2025.
|
|
|
Rs. |
|
1 |
Income from Salary (Computed) |
24,000 |
|
2. |
Income from House property(Computed) House A(Income) House B (Loss) House C self
–occupied(loss) |
10,000 -40,000 28,000 |
|
3. |
Profit and gains from Business Cloth business (profit) Hardware Business(loss) Speculation- business (profit) Speculation business (loss) |
10,000 12,000 12,000 17,000 |
|
4. |
Short term (gain) Short term(loss) Long term( gain) |
8,000 24,000 8,000 |
|
5. |
Income from other sources Income from betting Income from card games Interest on securities |
12,000 9,000 8,000 |
SOLUTION
STEP 1: INTRA –HEAD OR INTER-SOURCE( SAME HEAD )
ADJUSTMENT
|
|
|
|
Rs. |
|
1 |
Income from Salary (Computed) |
|
24,000 |
|
2. |
Income from House property(Computed) House A(Income) House B (Loss) House C self
–occupied(loss) |
10,000 -40,000 -28,000 |
|
|
|
To be adjusted with other heads |
-58,000 |
|
|
3. |
Profit and gains from Business Cloth business (profit) Hardware Business(loss) |
10,000 -12,000 |
|
|
|
To be adjusted
with other heads |
-2000 |
|
|
|
Speculation- business (profit) Speculation business (loss) |
12,000 -17,000 |
|
|
|
Carry Forward (C/F) |
-5,000 |
|
|
4. |
Short term (gain) Short term(loss) Long term( gain) |
8,000 -24,000 -8,000 |
|
|
|
Carry Forward (C/F) |
-24,000 |
|
|
5. |
Income from other sources Income from betting Income from card games Interest on securities |
|
12,000 9,000 8,000 |
STEP 2: INTER-HEAD ADJUSTMENT
Calculation of Gross Total
Income
|
|
|
|
Rs. |
|
1 |
Income from Salary (Computed) |
24,000 |
|
|
2. |
Interest on securities |
8,000 |
|
|
|
|
32,000 |
|
|
|
Less: H P loss to be adjusted |
-58,000 |
|
|
|
Carry
Forward(C/F) |
-26,000 |
|
|
3. 4. |
Income from betting Income from card games |
|
12,000 9,000 |
|
5. |
GROSS TOTAL INCOME |
|
21,000 |
|
|
Carry Forward
to next year House property loss Speculation loss Short term capital loss |
26,000 5,000 24,000 |
|
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