COMPUTE THE NET WEALTH AND WEALTH TAX LIABILITY OF ABC LTD AS ON 31.03.2011. THE COMPANY IS ENGAGED IN JEWELLARY BUSINESS- EXPORTS AND DOMESTIC SAKES:
FACTORY BUILDING 4300000 BANK BALANCES 1220000 UNACCOUNTED CASH BALANCE 650000 SILVER WARE 9400000 GOLD ORNAMENTS 9600000 MOTOR CARS 1500000 GUEST HOUSE IN LONDON 800000
THE COMPANY HAS TAKEN A LOAN OF RS 600000 BY MORTGAGING GUEST HOUSE AND BUILT THE FACTORY PREMISES.
Guest
Guest
(Expert)
12 March 2012
Factory building- not a taxable asset since used for commercial purpose. Bank balance- not a taxable asset as per sec. 2 Unaccounted cash balance- Rs. 650000/- taxable fully. Silver ware- Rs. 9400000/- fully taxable (assuming they are not stock in trade) Gold ornametns- Rs. 9600000/- fully taxable Motor cars- 1500000/- fully taxable Guest house in london- 800000/- fully taxable
Loan by mortgaging building- not allowed since the loan was taken by mortgaging property and aslo the asset not included in taxable wealth deduction will not be available.
So taxalbe assets: (650000+9400000+9600000+1500000+800000) = 2,19,50,000/- net taxable wealth after basic exemption of Rs. 30,00,000/- = 1,89,50,000/- Wealth tax @ 1% = 189500/-
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