Please choose the correct answer

Tax queries 1789 views 8 replies

Guest

Hello Friends,

While studying today I got stuck in a few MCQs in which your help is required.

1. An employee who was not entitled to gratuity, got 30% of his total pension commuted in the past. He wishes to commute another 25% of his total pension in the previous year. He shall be allowed exemption to the extent of:

A. NIL

B. 20%

C. 25%

2. R, had acquired a license to operate telecommunication service in the previous year 2007-08 for 2 Crores and it has a life of 20 years. Part of the license is sold in the previous year 2011-12 for 1 Crore. R shall be allowed deduction to the extent of:

A. 3.75 Lakhs per year for the remaining 16 years

b. Entire 60 Lakhs in the PY 2011-12.

3. Under section 44AB, specified date means ______ of the AY.

4. The additional depreciation in respect of new building constructed in Financial year 2009-10 at a cost of 25 Lakhs for maufacturing garments will be Rs. _________

Replies (8)

PRITAM JAIN, CA , CS

Practising CA CS

398 Points Joined September 2007

2) Deduction allowable upto F.Y. 2010-11 = 2 cr / 20years

= 10 lacs

Opn bal.=1.6 cr-1cr(sold) = 60lacs/16years(remaining period)

= 3.75 Lacs

PRITAM JAIN, CA , CS

Practising CA CS

398 Points Joined September 2007

1) Suppose Total Pension amount is Rs. 1,00,000/-

Now Pension earlier coomuted = Rs. 30,000/-

Total Exemption available u/s. 10(10A)(ii) = Rs. 50,000/-(50% of pension normally entitled to)

Rs. 30,000 was fully exempt.

Now he is left with only Rs. 20,000/- benifit of exemption unutilised.

Therefore 20% will be the correct Ans

Wait till the other experts comment

Regards..

PRITAM JAIN, CA , CS

Practising CA CS

398 Points Joined September 2007

3) Specified date means 30th Sep of the A.Y.

PRITAM JAIN, CA , CS

Practising CA CS

398 Points Joined September 2007

4) Additional Dep. is allowable for Eligible Plant & Machinery and not for building......

Guest

Thanks a lot Pritam Sir for your help, but can new buliding for the purpose of manufacture cant be considered as plant??

Guest

Also I am unable to understand the concept behind commuting only 20% the second time. I know that 1/2 of the total commuted pension is allowed as a deduction, but 20% ??

PRITAM JAIN, CA , CS

Practising CA CS

398 Points Joined September 2007

Originally posted by : Disha Bhawnani
	Thanks a lot Pritam Sir for your help, but can new buliding for the purpose of manufacture cant be considered as plant??

No. Additional dep is for new MACHINERY and not otherwise

PRITAM JAIN, CA , CS

Practising CA CS

398 Points Joined September 2007

Originally posted by : Disha Bhawnani
	Also I am unable to understand the concept behind commuting only 20% the second time. I know that 1/2 of the total commuted pension is allowed as a deduction, but 20% ??

Remaining exemption amount is Rs20,000 na thats y 20000/100000*100

I may really not sure about.

Please take others view too....