Dibrugarh University (6th Semester Speciality) - Direct Tax - II Important Questions and Answers (MODIFIED)

Unit 1

Q. What are income chargeable to tax under the head profit and gain of business or profession?

Q. Define “business and profession” as used U\S 28 of the Income “Tax Act, 1961. Discuss in detail the general principles governing determination of business income.

Q. What do you mean by the term “Depreciation”? What are the rules regarding grant of deduction for depreciation?

Q. Write Short notes on:

Ø  Inadmissible deduction us 40

Ø  Payment excluded us 40A

Unit 2

Q. What do you mean by capital gains? Explain in detail capital gain exempted from tax.

Q. How would you determine cost of acquisition and cost of improvement u/s 49? Describe the procedure of ascertaining Short Term capital Gains and long term capital Gains.

Q. Explain the concept of Transfer under the head capital gains. Mention the transactions which are not regarded as transfer.

Q. Write notes on capital assets and transfer. How will you distinguish between capital gain’ and income?

Optional Questions for Unit 2

Q. What are the incomes and deemed incomes chargeable under the head “Income from other sources”?

Q. What do you mean by Income from other sources? Explain the allowed and disallowed deductions under the head income from other sources.

Unit 3

Q. Explain the provisions of the income tax Act, 1961 regarding carry forward and setoff of losses.

Q. Explain the process of setting off and carry forward of losses in computing gross total income with exception.

Q. What is unabsorbed depreciation? How it is set off?

Unit 4

Q. What are the assets mentioned in section 2(ea) of the wealth tax act, 1957? Explain in detail.

Q. What are the deemed assets and exempted assets as per provisions of the wealth tax act, 1954? Discuss in detail.

Q. Write short notes on:

Ø  Valuation date

Ø  Debts owed

Ø  Computation of net wealth’

Ø  Assets held by a minor child

Ø  Gift by means of book entries where money has not been actually delivered to the other person.

Ø  Tax incidence

Ø  Property held by a member of a housing society

Unit 5

Q. What do you mean by tax planning? Write a brief note on deductions from sec. 80C to 80U.

Q. Tax Planning of a Salaried Person (Refer VP Gaur Book 1st Page)

Q. How tax liability is computed for a salaried person?

Q. How deductions are made in respect of the following section of the income tax act 1961?

Ø  Deduction under section 80C and 80D

Ø  Deduction in respect of certain undertakings of north eastern states (section 801E)