SECTION A: INCOME TAX LAW

Question No.1 is compulsory.

Working Notes should form part of the answer. Wherever necessary, suitable assumptions
may be made by the candidates and disclosed by way of a note. However, in answers to
Questions in Division A, working notes are not required.

Division A – Multiple Choice Questions

Write the most appropriate answer to each of the following multiple choice questions by
choosing one of the four options given. All questions are compulsory.

Q 1: Case Study 1

Juhi, a resident of age 35 years, owns a plot of land in a rural area located 10 kms from the local
municipal limits of Bhopal. During the PY 2021-22, she rented out 10% of the area to Vatsal who
used it to cultivate maize and paid a rent of Rs. 10,000 per month to Juhi.

20% of the area was used by Juhi for paddy farming. She sold the paddy in the market for Rs.
3,00,000 after incurring expenses on farming of Rs. 1,20,000 and carrying on activities of
cleaning, filtering and packing before taking it to the market.

40% of the area was used by Juhi for producing sugarcane which she used to manufacture
sugar. She incurred Rs. 2,00,000 on cultivating sugarcane and Rs. 1,00,000 on manufacturing
sugar. Sugar was sold in the market for Rs. 10,00,000. Market value of sugarcane was Rs.
6,00,000.

Juhi also owned a storehouse adjacent to the land which she used to store paddy and
sugarcane. Annual letting value of the storehouse was Rs. 3,60,000
Juhi maintained a nursery in 10% of the area where she grew saplings and seedlings in pots
without carrying out any operations on land as such. Sale of saplings and seedlings for the year
amounted to Rs. 1,50,000. She incurred Rs. 50,000 as expenses in running the nursery.

20% of the land was not put to any use. Juhi sold this piece of land to Mohan for Rs. 5,00,000
on 1.9.2021. Stamp duty value on this date was Rs. 10,00,000 The cost of this portion of land
was Rs. 1,00,000 which she had acquired on 1.5.2005.

During the year, she received Rs. 2,50,000 as dividend from a company, engaged in agricultural
business, in which she was a majority shareholder

Based on the facts of the case scenario given above, choose the most appropriate answer to
the following questions for the AY 2022-23:

1. Determine the amount of income taxable as business income in the hands of Juhi?
A. 7,00,000
B. 4,80,000
C. 3,00,000
D. 5,80,000

2. Determine the amount taxable as Income from Other Sources in the hands of Juhi?
A. 2,50,000
B. 3,70,000
C. 6,10,000
D. 7,30,000

3. Determine the amount taxable as capital gain in the hands of Juhi?

A. 4,00,000
B. 2,29,060
C. 7,29,060
D. Nil
4. What is Total income of juhi?
A. 7,79,060
B. 5,50,000
C. 3,00,000
D. 6,50,000

(2× 4 = 8 Marks )

Q 2: Which of the following computation of tax liability is correct?

A. Mr. X, of age 35,has total income of Rs. 6,00,000. Tax liability = Rs. 20,000 (Tax of Rs.
32,500 – Rebate of Rs. 12,500) + 4% HEC of Rs. 800 = Rs. 20,800.
B. Mr. X, resident of age 35, has total income of Rs. 5,00,000. Tax liability = Rs. 12,500 (Tax of
Rs. 12,500 + Rebate of Nil) + 4 % HEC of Rs. 500 = Rs. 13,000.
C. Mr. X, resident of age 35, has total income of Rs. 4,99,900. Tax liability = Rs. 12,500 (Tax of
Rs. 12,495 - R–bate of Rs. 12,495) + 4 % HEC of Nil = Nil.
D. Mr. X, resident of age 35, has total income of Rs. 5,00,000. Tax liability = 13,000 (Tax of Rs.
12,500 + HEC @4% of Rs.500) – Rebate of Rs. 12,500 = Rs. 500.
(1 MARKS)

Q 3: Sahil was employed with JK Ltd. in Kochi. He received a salary of Rs. 40,000 p.m. from
1.4.2021 to 27.9.2021 in his Mumbai account. He resigned and left India for first time on
1.10.2021 to go to Dubai and got salary of rupee equivalent of Rs. 80,000 p.m. from 1.10.2021
to 31.3.2022. his salary for October to December 2021 was credited in his Dubai account and
salary for January to March 2022 was credited in his Mumbai account directly. He is liable to tax
respect of:

A. Income received in India JK Ltd.

B. Income received in India and in Dubai
C. Income received in India from JK Ltd. and income directly credited in India
D. Income received in Dubai

(1 MARKS)

Q 4: In which of the following cases is sum received under a life insurance policy exempt from
tax?

A. ULIP purchased on 1.9.2011 for sum assured of Rs. 25 lakh at an annual premium of rs.
2.75
B. Life insurance policy (not ULIP) purchased on 1.9.2019 for sum assured of Rs. 25 lakh at
an annual premium of Rs. 2.75 lakh
C. ULIP purchased on 1.9.2021 for sum assured of Rs. 30 lakh at an annual premium of Rs.
2.75 lakh
D. Keyman insurance policy purchased on 1.9.2021 for sum assured of Rs. 25 lakh at an
annual premium of Rs. 2 lakh
(2 Marks)

Q 5: U/s 44AE, presumptive taxation is applicable at a particular rate provided the assessee is
the owner of a maximum of certain number of goods carriages. The rate per month or part of
the month relevant for ZAY 2022-23 and the maximum number specified under the section are;

A. 7,500 for each goods carriage in case of assessee owning not more than 10 goods carriages
at any time during the year
B. 7,500 for each goods carriage in case of assessee owning less than 10 goods carriages at
any time during the year
C. 1,000 per ton of gross vehicle weight per month or part of a month for goods carriage in
case of assessee owning not more than 10 goods carriages at the end of PY.
D. 1,000 per ton of gross vehicle weight or unladen weight as the case may be , for per month
or part of a month for a heavy goods carriage and 7,500 per month or part of a month for
other goods carriages in case of assessee owning not more than 10 goods carriages at any
time during PY

(1 MARKS)

Q 6: In which of the following situations, can Raje claim exemption u/s 54F?
A. Raje staying in her only self owned house in Raj nagar and running a business from a
self owned shop, sold gold jewellery (acquired in 2016 ) on 1.4.2021 and purchased a
residential house in Jhansi on 1.6.2020
B. Raje, staying in herself owned house in Raj Nagar and owning another residential
house in the same city, sold gold jewellery (acquired in 2016) on 1.4.2021 and
purchased a residential house in Jhansi on 1.3.2023
C. Raje, staying in a rented house sold a plot of land (acquired in 2020) on 1.4.2021 and
constructed a residential house in Jhansi (completed on 1.6.2023)
D. Raje staying in her only self-owned flat in Raj Nagar and running a business from a self
owned office building sold the office building (acquired in 2016) on 1.4.2021 and
purchased a residential house in Lahore on 1.6.2022

(1 MARKS)

Q 7: Mr. Raja a resident but not ordinarily resident, turned 60 years of age on 31.3.2022.
Taxable income for AY 2022-23 comprised the following: Pension Rs. 1,00,000 (computed),
short term capital gain on sale of equity shares (STT paid on sale) Rs 50,000 and on sale of gold
Rs. 1,00,000, long term capital gain on sale of equity shares (STT paid on purchase and sale) Rs.
2,20,000 and on sale of a painting Rs. 1,20,000. He deposited Rs. 1,50,000 in his PPF account
during the year. Mr. Raja has not opted for section 115BAC. His tax liability will be:
A. 9,650
B. 5,440
C. 4,160
D. Nil

(2 Marks)

Q 8: If, in the hands of Mrs. C, a resident aged 70 years, interest on securities for the PY 2021-
22 is Rs. 45,000 (net of TDS @ 10%, pension from employer(computed)is Rs. 2 lakh, undisclosed
income u/s 69C is Rs. 1 lakh and investment in PPF Account is Rs. 1 Lakh, the Total Tax Liability
for AY 2022-23 will be (115BAC not opted):

A. Nil
B. 61,750
C. 62,400
D. 78,000

(2 marks)

Division B – Descriptive Questions

Question No. 1 is compulsory

Attempt any two questions from the remaining three questions

Q 1: Mr. Krishna (aged 65 years), a furniture manufacturer, reported a profit of Rs.

5,64,44,700/- for the previous year 2021-22 after debiting/crediting the following items:

Debits:
1. Rs. 20,000/- paid to a Gurudwara registered u/s 80G of the Income tax Act, in cash where
no cheque are accepted.
2. Rs. 48,000/- contributed to a university approved and notified u/s 35(1) (ii) to be used for
scientific research.
3. Interest paid Rs. 167,000/- on loan taken for purchase of E-vehicle on 15/05/2021 from a
bank. The E-vehicle was purchased for the personal use of his wife.
4. His firm has purchased timber under a forest lease of Rs. 20, 00,000/- for the purpose of
business.

Credits:

1. Income of Rs. 4, 00,000/- from royalty on patent registered under the Patent Act received
from different resident clients. No TDS was needed to be deducted by any of the clients.
2. He received Rs. 3, 00,000/- from a debtor which was written off as bad in the year 2017-18.
Amount due from the debtor (Which was written off as bad) was Rs. 5,00,000/- out of
which tax officer had only allowed Rs. 3,00,000/- as deduction in computing the total
income for assessment year 2018-19.
3. He sold some furniture to his brother for Rs. 7,00,000/- The Fair market value of such
furniture was Rs. 900,000/-

Other information:

1. Depreciation in books of accounts is computed by applying the rates prescribed under the
Income tax law.
2. Mr. Krishna purchased a new car Rs. 12, 00,000/- on 1st September 2021 and the same was
put to use in the business on the same day. No depreciation for the same has been taken on
car in the book of account.
3. Mr. Krishna had sold a house on 30th March 2019 and deposited the long term capital gains
of Rs. 25, 00,000/- in capital gain account scheme by the date of filing return of income for
that year. On 25th March 2022, he withdrew money out of his capital gain account and
invested Rs. 1 Crore on construction of the one house.
4. Mr. Krishna also made the following payment during the previous year 2021-22.
 Lump-sum premium of Rs. 30,000/- paid on 30th March, 2022 for the medical policy taken
for self and spouse. The policy shall be effective for five years i.e. from 30th March 2022 to
29th March 2027.
 Rs. 8,000 paid in cash for preventive health check-up of self and spouse.

Compute the total income and tax payable by Mr. Krishna for the assessment year 2022-23
if he has not opted for the provisions of section 115BAC.

(14 Marks)

Q 2 (a) Discuss the liability for TCS (or TDS, if applicable) in the following cases:

(i) Mr. Ashok, working in a private company, is on deputation for 3 months (from December
2021 to February 2022) at Hyderabad where he pays a monthly house rent of Rs. 52,000 for
those three months, totaling to Rs. 1, 56,000. Rent is paid by him on the first day of the relevant
month.

(ii) Mr. Z, a resident of age 75 years, is a pensioner receiving Rs. 55,000 p.m. as pension in
Jaipur branch of National Bank. The Bank is specified u/s 194P. He also maintains fixed deposit
in Delhi branch of National Bank. Interest on savings account with Jaipur branch and fixed
deposit account with Delhi branch is Rs. 1, 00,000 for the PY 2021-22. He has no other income.
Mr. Z wants to know whether he is required to file ROI u/s 139(1) for the PY 2021-22 and
whether he needs to pay any tax from his end. He has not opted for section 115BAC.

(iii) Cars & Co., a partnership firm and dealer in cars, purchased 10 cars of Rs. 15 lakh each from
Honda Cars Ltd., an Indian car manufacturer having turnover of Rs. 15 crore in FY 2020-21,
during January 2022. Turnover of Cars & Co. was Rs. 12 crore for FY 2020-21 and Rs. 9 crore for
FY 2021-22.

(4 Marks)
Q 2 (b) Madhav made a gift of Rs. 2,50,000 to his handicapped son, Master Tapan, who was
aged 12 years, as on 31.3.2020, which he deposited in a fixed deposit account in a nationalized
bank at 10% interest p.a. compounded annually. The balance in this account as on 1.4.2021 was
Rs. 2, 75,000 and the bank credited a sum of Rs. 27,500 as interest on 31.3.2022.

Madhav’s father gifted equity shares worth Rs. 50,000 of an Indian company to Master
Manan, another son of Madhav (date of birth 10.4.2014.) in July 2014 which were purchased by
him on 8.12.2007.For Rs. 80,000 Manan received a dividend of Rs. 5,000 on these share in
October 2021. He sold these shares on 1.11.2021 for Rs. 5, 00,000 and deposited Rs. 3, 00,000.
in a company at 15% interest per annum.

Madhav has a taxable income of Rs. 3, 50,000 from Profession during FY 2021-22. Compute his
gross total income for AY 2022-23.

(4 Marks)

Q 2 (c) Mr. Honey is working with a domestic company having a production unit in USA for last
15 years. He has been regularly visiting India for export promotion of company’s product. He
has been staying in India for at least 184 days every year. He submits the following information.

1. Salary received outside India (for 6 months) Rs. 50,000 p.m.

2. Salary received in India (for 6 months) Rs. 50,000 p.m.

3. He has been given rent free accommodation in USA for which company pay Rs. 15,000 p.m.
as rent, but when he comes to India, he stays in the guest house of the company. During this
period he is given free lunch facility. During the PY company incurred expenditure of Rs. 48,000
on this facility.
4. He has been provided a car of 2000 cc capacity in USA which is used by him for both office
and private purposes. But when he is in India, the car is used by him and the members of his
family only for personal purpose. The monthly expenditure of car is Rs 5,000. The actual cost of
car is Rs. 8 lakh.

5. His elder son is studying in India for which his employer spends Rs. 12,000 per year whereas
his younger son is studying in USA and stays in a hostel for which Mr. Honey gets Rs. 3,000 p.m.
as combined allowance.

6. The company has taken an accident insurance policy and life insurance. During PY the
company paid premium of Rs. 5,000 and Rs. 10,000 respectively.

Compute his taxable income from salary for AY 2022-23.

(4 Marks)

Q 3 (a)

Ms. Rekha, a Resident individual aged 50, provides the following information for FY 2021-22.
She is a partner in AK & CO. and received the following amounts from the firm:

 Share of profit from the firm Rs.35,000

 Interest on capital @ 15% p.a. Rs.3,00,000

 Salary as working partner ( fully allowed in the hands of the Rs.1,00,000

firm)

She is running a rice mill as proprietor. The net profit as per Profit & Loss account is Rs. 4,
50,000. The following items are debited to Profit & Loss account:

 Advance income tax paid Rs. 1,00,000

 Personal drawings Rs. 50,000

The following are credited to profit & Loss account:

 Interest on savings bank account with SBI Rs. 12,000

 Interest on savings account with Post office Rs. 5,000

 Dividend from listed Indian company Rs. 80,000

She owned a house property in Mumbai which was sold in January 2020. She received Rs.
90,000 by way of arrear of rent in respect of the said property in October 2021.

She made the following investments:

 Life Insurance premium on a policy in the name of her married Daughter Rs. 60,000. The
Policy was taken on 1.10.2016. And the sum assured being Rs. 5, 00,000.
 Health insurance premium on a policy covering her mother aged 75. She is not dependent
on Ms. Rekha Premium paid by cheque Rs. 35,000.

Compute the total income and tax liability of Ms. Rekha for the AY 2022-23, considering section
115BAC.

(8 Marks)

Q 3 (b)

M/s Bhandari & Batra, a partnership firm consisting of two partners, Reports a net profit of Rs.
7, 00,000 before deduction of the following items:

1. Salary of Rs. 20,000 each per month payable to two working partners of the firm (as
authorized by the deed of partnership).

2. Depreciation.

3. On plant and machinery u/s 32 of Rs. 1, 50,000.

4. Interest on capital of 15% p.a. (as per deed of partnership). The amount of capital eligible for
interest is Rs. Rs. 5, 00,000.

5. Carry forward loss of PY 2020-21 is Rs. 50,000

Compute for Y 2022-23:

a. Book profit of the firm u/s 40(b).

b. Amount of salary that can be paid to working partners as per section 40 (b).

(4 Marks)

Q 3 (c) Mr. Subramanian, due to inadvertent reasons, failed to file his income tax return for AY
2022-23. Can he file the return in the year 2023-24? If yes, when is the last date to file this
return?

(2 Marks)

Q- 4 (a) Rajan, a resident of age 30 years, provides you with the following details with regard to
sale of certain securities by him during FY2021-22:

1. Sold 10,000 shares of A Ltd. On 5.4.2021 @ Rs. 650 per share - A Ltd. Is a Listed company.
These shares were acquired by Rajan on 5.4.2016 @ Rs. 100 per share. STT was paid both at
time of acquisition as well as at time of transfer of such shares which was affected through
a recognized stock exchange. On 31.1.2018, the shares of A Ltd. were traded on a
recognized stock exchange as under: Highest price Rs. 300 per share, Average price Rs. 290
per share, lowest price Rs. 280 per share.
2. Sold 1,000 units of B Mutual Fund on 20.4.2021@ Rs. 50 per unit- B Mutual Fund is an
equity oriented fund These units were acquired by Rajan on 15.4.2017 @ Rs. 10 per unit.
 STT was paid only at the time of transfer of such units. On 31.1.2018, the NAV of these units
was Rs. 55 per unit.
3. Sold 100 shares of C Ltd. On 25.4.2021 @ Rs. 208 per share- C Ltd. is an unlisted Company.
These shares were issued by the company as bonus shares on 30.9.1997. The fair market
value market value of these shares on 1.4.2001 was Rs 50 per share.
Calculate the amount taxable as capital gain and also calculate tax on such gains for AY
2022-23 assuming that the other incomes of Rajan amount to Rs. 4, 00,000.Assume that the
assessee has not opted for section 115BAC.

(6 Marks)

Q 4 (b) Mr. Rehman furnishes the following information for FY 2021-22.

Particulars (Rs.)

Loss from speculation business A (70,000)

Profit from speculation business B 30,000

Loss from self occupied property (2,20,000)

Income from let out property 4,20,000

Income from trading and manufacturing business 2,00,000

Salary income 3,70,000

Interest on PPF deposit 65,000

Long term capital gain on sale of vacant site 1,10,000

Short term capital Loss on sale of Jewellery (50,000)

Investment in tax saver deposit on 31.3.2022 60,000

Brought forward Loss of business of AY 2016-17 ( 1,00,000)

Enhanced compensation received from Government for compulsory 3,00,000

acquisition of land in the year 2007

Compute the total income for AY 2022-23 and the loss he is eligible to carry forward.

(4 Marks)

Q 4 (c) Devesh and Siddhant are brothers and they earned the following incomes during FY
2021-22. Devesh settled in America in the year 1998 and Siddhant settled in Mumbai. Devesh
visits India for 20 days every year. Siddhant also visits America every year for a month. Compute
their gross total income for AY 2022-23 from the following information:

Particulars Devesh Siddhant

1 Interest on American Development Bonds, 50% of interest 46,000 18,000

received in India

2 Dividend from a Japanese company received in America 10,000 15,000

3 Profit on sale of shares of an Indian company received in India 45,000 75,000

4 Profit from a business in Mumbai but managed directly from 10,000 -

America

5 Income from a business in Mumbai 32,000 28,000

6 Fees for technical services rendered in America and received in 1,50,000 -

America. The Services were, however, utilized in India
7 Interest on savings bank deposit in state Bank of India, Mumbai 4,500 12,000

8 Rent received in respect of house property at Mumbai 96,000 55,000

(4 Marks)

OR

Q 4 (c) Mr. Avani , a resident aged 25 years, manufactures tea leaves from the tea plants grown
by him in India . These are then sold in the market for Rs. 40 Lakh. Cost of growing tea plants is
Rs. 15 lakh and that of manufacturing tea leaves is Rs. 10 lakh. Compute his tax liability for AY
2022-23. He has not opted for section 115BAC.

(4 Marks)

SECTION B - INDIRECT TAXES

(i) Working Notes should form part of the answers. However, in answers to Question in Division
A, working notes are not required.

(ii) Wherever necessary, suitable assumptions may be made by the candidates, and disclosed by
way of note.

(iii) All questions should be answered on the basis of the position of GST law as amended up to
30th NOV, 2021.

(iv) The GST rates for goods and services mentioned in various questions are hypothetical and
may not necessarily be the actual rates leviable on those goods and services. Further, GST
compensation cess should be ignored in all the questions, wherever applicable.
 Division A - Multiple Choice Questions (MCQs)

Write the most appropriate answer to each of the following multiple choice questions by
choosing one of the four options given. All questions are compulsory.

Q-1 Case Study 2:

SV Enterprises (P) Ltd is a pharmaceuticals company engaged in the manufacturing of

medicines. It has its head office in Rajasthan being registered under GST. It primarily sells two
products in the market which are as under:

(i) A (Taxable at 18%)

(ii) B (Taxable at 28%)

From head office (HO), it makers sales on the basis of orders received from dealers and its
branches.

Total sales during the method of February is given below:

A B

Inter-State (Rs.) Inter-State (Rs.) Inter-State (Rs.) Inter-State (Rs.)

50,00,000 (including 50,00,000 50,00,000 30,00,000

branch transfers)

The company transferred product A to its branch situated in Mumbai for Rs. 10,00,000. The
open market value of product A was not known at the time of transfer, but the goods of like
kind and quantity were sold at Rs. 12,00,000. Cost of product A is Rs. 8,00,000. Further, the
branch deals in product A and product B only.
The company purchases its raw material worth Rs. 60,00,000 taxable @ 18% to be used in
product A, from a supplier located at Haryana and imported raw material worth Rs. 40,00,000
taxable @ 28% to be used in product B, from U.S.A based vender.

The opening balance of input tax credit of SV Enterprises (P) Ltd. for the relevant tax period is
nil. Further, subject to the information given above, assume that all the other condition
necessary for availing ITC have been fulfilled. All the above transactions are exclusive of GST,
wherever applicable.

Based on the facts of the case scenario give above, choose the most appropriate answer to Q.
Nos. (i) to (v) as follow:-

(i) What shall be the GST paid by SV Enterprises (P) ltd. through Electronic Cash Ledger?

A. IGST: Rs. 1,00,000, CGST: Rs. 8,70,000, SGST: Rs. 8,70,000

B. IGST: Rs. 11,20,000, CGST: Rs. 8,70,000, SGST: Rs. 8,70,000
C. IGST: Rs. 12,20,000, CGST: Rs. 8,70,000, SGST: Rs. 8,70,000
D. IGST: Nil, CGST: Rs. 8,70,000, SGST: Rs. 8,70,000

(ii) Suppose Product A is exempt from GST, what shall be the aggregate turnover of SV
Enterprises?

A. Rs. 1,80,00,000
B. Rs. 80,00,000
C. Rs. 2,20,00,000
D. Rs. 1,40,00,000

(iii) What shall be the value of supply of product “A” transferred to its branch in Mumbai?

A. Rs. 10,00,000
B. Rs. 12,00,000
C. Rs. 8,00,000
D. Rs. 8,80,000

(iv) Suppose out of imported raw material amounting to Rs. 40,00,000, raw material to Rs.
10,00,000 was sold to another local customer before clearance for home consumption. What
shall be the net GST liability in this case?

A. IGST: Rs. 3,80,000 CGST: Rs. 8,70,000, SGST: Rs. 8,70,000

B. IGST: Rs. 1,00,000 CGST: Rs. 8,70,000, SGST: Rs. 8,70,000
C. IGST: Rs. 12,20,000 CGST: Rs. 8,70,000, SGST: Rs. 8,70,000
D. IGST: Rs. 20,60,000 CGST: Rs. 8,70,000, SGST: Rs. 8,70,000

(v) If the payment for Product A was received on 25th February from one of the customers,
goods supplied on 28th February an invoice issued on 3rd March, shall be the time of supply in
this case?

A. 25th February
B. 28th February
C. 3rd March
D. 20th March

(1× 5=5 Marks)

Q 2: A new client, Mr. Z, has recently obtained GST registration and keeps manual accounts. He
has got his GSTIN printed on top of every page of new booklet printed for tax invoice. Apart
from his principal place of business, he owns 2 godowns where he keeps stock of his goods and
does some wholesale trading. He asks you weather he needs to display the GSTIN registration
and GSTIN at any other places?
A. MR. is required to display his certificate of registration in a prominent location at his
principal place of business only. Name board at entry shall display GSTIN at his principal
place of business only.
B. Mr. Z has to display his certificate of registration in a prominent location of his principal
place of business and at every additional place or places of business. Also, he should
display GSTIN on the name board exhibited at the entry of his principal place of business
and at every additional place or places of business.
C. The certificate of registration is not required to be displayed. Only name board at entry of
his principal and additional places of business shall display GSTIN.
D. The certificate of registration in a prominent location is required to be displayed only at
principal place of business. Name board at entry of principal and additional places of
business shall display GSTIN.

Q 3: Which of the following shall not be included in value of supply?

A. Subsidies provided by the Central Government and State Governments.

B. Discounts which is given before or at the time of the supply if such discount has been duly
recorded in the invoice issued in respect of such supply.
C. any taxes levied under CGST Act, SGST Act, UTGST Act and GST (Compensation to States)
Act
D. All of the above

Q 4. What is the rate of interest in the case of belated payment of tax?

A. 1%
B. 10%
C. 18%
D. 24%
Q 5. Smart Pvt. Ltd has registered head office located in Bangalore (Karnataka). However, the
branch of smart Pvt. Ltd is located in state of Gujarat. Both Bangalore office & branch in Gujarat
will be treated as…………….under GST Act?

A. Deemed distinct person

B. Principal and Agent
C. Both (a) or (b)
D. None of the above

Q 6. What are the parameters, which are required to be capture in the QR code?

A. Supplier’s GSTIN number

B. Total invoice value, invoice number, invoice date
C. GST amount along with breakup i.e. CGST, SGST, IGST,CESS
D. All of the above

Q 7. DakshLtd.a registered manufacturer, demerged its entity into DG gold Ltd. and DG gold
testing Ltd. the total value of assets of Daksh Ltd. is Rs. 45,00,000 (which include furniture and
fixture Rs. 10,00,000), two motor vehicles Rs. 5,00,000 (Rs. 2,50,000 each), plant and machinery
Rs. 20,00,000, other assets Rs. 10,00,000).

Unutilized credit on account of CGST< SGST and IGST amounted to Rs. 56,000, Rs. 65,000 and
Rs. 75,000 respectively. The above unutilise ITC does not includes ITC on motor vehicle as it is
block credit as per sec 17(5) of CGST Act.

The value of asset of Daksh Ltd. is divided equally in DG Gold Ltd. and DG testing Ltd. except the
value of motor vehicle. Motor vehicle is taken over by DG Gold Ltd.
Calculate the value of assets in which ITC is divided between DG Gold Testing Ltd.

A. DG Gold Ltd. Rs. 25,00,000 and DG Gold Testing Ltd. Rs. 20,00,000
B. DG Gold Ltd. Rs. 22,50,000 and DG Gold Testing Ltd. Rs. 22,50,000
C. DG Gold Ltd. Rs. 20,00,000 and DG Gold Testing Ltd. Rs. 20,00,000
D. DG Gold Ltd. Rs. 22,50,000 and DG Gold Testing Ltd. Rs. 20,00,000

(1 × 7= 7 Marks)

Division B - Descriptive Questions

Question No. 1 is compulsory.

Attempt any two questions out of remaining three questions.

Q-1 X Ltd. is in the business of manufacture of Kitchen appliances for domestic market. It is
located in Hyderabad. During January 2022, it has acquired the following-

Taxable value of inwards GST charged by

supply (Rs.) supplier (Rs)

Steel from a Mumbai supplier ( to be used 3,00,000 54,000

as raw material in factory)

Steel rods from a Hydrabad supplier ( to be 70,000 12,600

used in factory)

50 LED lamps from a Hydrabad supplier ( to 50,000 6,000

be used in office)

Machinery for gym from a vijaywada 6,50,000 78,000

supplier (gym is used by employees of X ltd.)

Group mediclaim insurance policy ( taken for 3,00,000 54,000

employees and their family members)

Calculate the amount of GST payable for January 2022 taking into consideration the
following additional information-

1. On January 1, 2022, electronic credit ledger has opening balance of Rs. 2,000 (CGST), Rs.
7,000 (SGST), and Rs. 3,000 (IGST)

2. On outward supply during January 2022, quantum of GST is as follow

(CGST) (SGST) (IGST)

Invoice issued 80,000 80,000 600

pertaining to outward
supply effected
during January 2022

Advance received : - - -
Rs. 1,00,000( supply
of goods to be made
during March 2022)
(no GST charged)

1. It can be utilised (in any manner) for payment of CGST and SGST. as no restriction is imposed
by the relevant legal provision as given in rule 88 A, the amount to be utilized towards
payments of CGST, in this case, should not be more than Rs. 13,040( i.e. Rs. 20,000 – 6,960) to
make minimum payment in cash.

2 Apart from manufacturing kitchen appliances X ltd. Also provides technical consultancy
pertaining to manufactures of kitchen appliances for consultancy services, it has received an
advance of Rs. 50,000 from Y Ltd. Hyderabad However, and consultancy work will be completed
only during March 2022. No GST is charged in amount received as advance (although GST rate is
18 per cent).

3 out of 50 LED lamps, 10 lamps are stolen by an unknown person before installation.

4. Assume that conditions for claiming input tax credit [including conditions imposed by rule
36(4) are satisfied.

(8 Marks)

Q-2(a) ‘Agro Care Limited’ registered under GST furnishes the following details with respect to
the activities undertaken by them in the month of March, 2022:

Particulars Rs

1. Receipts from Supply of farm labour 85,000

2. Charges for seed testing 65,000

3. Charges for soil testing of farm land 35,000

4. Charges for warehousing of potato chips 85,000

5. Commission received on sale of wheat 75,000

6. Charges for training of farmers on use of new

pesticides and fertilizers developed through scientific 10,000
research

7. Renting of vacant land to a stud farm 1,85,000

8. Leasing of vacant land to a cattle farm 83,500

9. Charges for warehousing of rice 1,50,000

10. Charges for warehousing of cotton fabrics 2,00,000

11. Retail packing and labeling of fruits and vegetables 5,00,000

12. Charges for warehousing of minor forest produce 8,00,000

13. Charges for warehousing of spices 2,20,000

Compute the value of taxable supply of Agro Care Limited for the month of March, 2022 if all
the above amounts are exclusive of GST.

(6 Marks)

Q-2 (b) Rajesh dynamics, having its head office in Chennai, carries on the following activities
with respective turnovers in a financial year:

Particulars Rs

Supply of petrol at Chennai, Tamil Nadu 18,00,000

Value of inward supplies on which tax is payable reverse charge basis 9,00,000

supply of transformer oil at Chennai 2,00,000

Value of branch transfer from Chennai to Bengaluru without payment of

consideration 1,50,000

Value of taxable supplies at Manipur branch 11,50,000

It argues that it does not have taxable turnover crossing threshold limit of Rs 40,00,000 either
at Chennai, Tamil Nadu or Bengaluru, Karnataka and including turnover at Manipur branch. It
believes that the determination of aggregate turnover at Manipur branch. It believes that the
determination of aggregate turnover is not required for the purpose of obtaining registration
but is required for determination composition levy.

Decide based on the above facts:

(i) The aggregate turnover of Rajesh Dynamics

(ii) All conditions that fulfill the requirements for registration under CGST Act, 2017 in the given
circumstance

(4 Marks)

Q-3(a) Mr. Himanshu, a registered supplier of chemicals, pays GST under regular scheme. He is
not eligible for any threshold exemption. He has made the following outward taxable supplies
for the month of September 2021:

Intra-State supply of goods - Rs 25,00,000

Inter-State supply of goods - Rs 5,00,000

He has also made the following inward supply:

Intra-State purchase of goods from Registered Dealer - Rs 14,00,000

Intra-State purchase of goods from Unregistered Dealer - Rs 2,00,000

Inter-State purchase of goods from Registered Dealer - Rs 4,00,000

Balance of ITC at the beginning of September 2021:

CGST - Rs 95,000

SGST - Rs 60,000

IGST - Rs 50,000

Additional Information:

He purchased a car (Intra-State supply) used for business purpose at a price of Rs 6,72,000/-
(including CGST of Rs 36,000 & SGST of Rs 36,000) on September 15, 2021. He capitalized the
full value including GST in the books on the same date to claim depreciation.

Out of Inter-State purchase from registered dealer, goods worth Rs 1,00,000 were received on
October 3, 2021 due to road traffic jams.
Note:

(i) Rate of CGST, SGST and IGST to be 9%, 9% and 18% respectively.

(ii) Both inward and outward supplies given above are exclusive of taxes, wherever applicable.

(iii) All the conditions necessary for availing the ITC have been fulfilled except mentioned above.

Compute the net CGST, SGST and IGST payable in cash by Mr. Himanshu for the month of
September 2021

(5 Marks)

Q-3(b) On August 20, 2021, X Ltd. (of Chennai) supplies goods/Services to Y Ltd. (of Vellore).
Taxable value of supply is Rs. 26, 80,000. On August 26, 2021 X Ltd supplies goods / Services to
Z Ltd. (of Bengaluru). Taxable value of supply is RS 5, 00,000. GST rate is 18 per cent. X Ltd. has
the following balance in his electronic credit ledger –

-IGST Rs 92,000

- CGST Rs 5,000

-SGST Rs 9,00,000

On August 21, 2021, X Ltd purchases Honda City (seating capacity as per RC 5 persons) from a
dealer in Chennai for its officers/ auditors. The car will be used by these persons only for
performing official duties. GST paid purchasing the car (which is not included in the above
figures) is as follows-CGST Rs 1,68,000, SGST Rs 1,68,000. There is no other transaction for the
month of August 2021. Find out GST on supply of goods to Y ltd. /Z Ltd. and prepare a
statement for availment of input tax credit.

(5 Marks)
Q-4(a) DLH Ltd. a real estate developer company is located in Chennai. On August 1, 2021, it
enters in to an agreement with Z to transfer a 1,000 square feet commercial flat in a building
under construction in Madurai. As per agreement, the possession of the flat will be handed
over in March 2022. Agreed consideration is Rs 90, 00,000 +GST. GST rate is 18 per cent. Tax
invoice issued by DLH gives the following data. Z pays Rs. 70,00,000 by cheque at the time of
signing the agreement.

Taxable value of supply Rs. Rs

Super structure of 1,000 square feet 90,00,000 90,00,000

(along with undivided share of land)

Less: value of Land(or undivided 30,00,000 -

share of land) (it is always deemed to
be 1/3rd of total amount charged)

Taxable value 60,00,000

Add: GST-

-CGST @ 9 per cent of Rs 60,00,000 5,40,000

-SGST @ 9 per cent of Rs. 60,00,000 5,40,000

Total 1,00,80,000

Possession is handed over on March 10, 2022. Z is not satisfied with the quality of stone and
wood used by DLH. Consequently, against the balance payment of Rs. 30, 80,000, Z pays Rs.
24,00,000 on March 20,2022 which is accepted by DLH as full and final payment. Discuss the
treatment of balance of Rs. 6,80,000 for the purpose of GST.

(5 Marks)
Q-4(b) Agrawal Carriers is a Goods Transport Agency (GTA) engaged in transportation of goods
by road. As per the general business practice, Agrawal Carriers also provided intermediary and
ancillary services like loading/unloading, packing/unpacking, transhipment and temporary
warehousing, in relation to transportation of goods by road.

With reference to the provisions of GST law, analyse whether such services are to be treated as
part of the GTA Service, being a composite supply, or as separate supplies.

(5 Marks)

OR

Q-4(c) X Ltd. us located in Ludhiana. It is in the business of manufacture of cast glass. . It has
received the following services from different persons during December 2021-

1. Service by Department of Posts by way of express parcel post (value of service: Rs 4,000).

2. X Ltd. owns and aircraft. This aircraft is used by directors/officers of the company for
business purposes. Aircraft maintenance service is provided by the government of India.
Payment of Rs. 8,00,000 is made for this purpose.

3. For Transportation of goods X Ltd. pays 60,000 to Indian Railways.

4. X Ltd has taken a commercial property on rent from the Punjab Government for which
company pays rent of Rs. 1,00,000.

5. X Ltd. has taken security services for factory complex from the Punjab Government for which
company pays rent of Rs. 30,000 is made.

6. X Ltd. has taken security services for office from Task Force Security Ltd. (a private sector
company) for which payment of Rs. 95,000 are made.
The above figures are before GST. Turnover of X Ltd. for the financial year 2020-21 was more
than Rs. 20,00,000. Discuss the following –

 Whether GST is applicable.

 Whether GST is payable under reverse charge mechanism.

(5 Marks)