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Question Paper

Taxation Duration: 180

Details: Full Test- 1 Marks: 100

Instructions:

 All the questions are compulsory

 Properly mention test number and page number on your answer sheet, Try to
upload sheets in arranged manner.
 In case of multiple choice questions, mention option number only Working notes are
compulsory wherever required in support of your solution
 Do not copy any solution from any material. Attempt as much as you know to fairly
judge your performance.

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 SECTION A: INCOME TAX LAW

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.

1. Case study

Mr. Mohan, aged 50 years, a resident individual and practicing Chartered Accountant,
furnishes you the receipts and payments account for the financial year 2023-24. He follows
the cash system of accounting.

Receipts and Payments Account

Receipts Rs. Payments Rs.

Opening balance (1.4.2023) Staff salary, bonus and

12,000 21,50,000
Cash on hand and at Bank stipend to articled clerks

Fee from professional Other administrative

59,38,000 11,48,000
services (Gross) expenses

Rent 50,000 Office rent 30,000

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 Housing loan repaid to SBI
Motor car loan from Canara
2,50,000 (includes interest of Rs. 1,88,000
Bank (@ 9% p.a.)
88,000)

Life insurance premium (10%

24,000
of sum assured)

Motor car (acquired in Jan.

4,25,000
2024 by A/c payee cheque)

Medical insurance premium

(for self and wife)(paid by A/c 18,000
Payee cheque)

Books bought on 1.07.2023

(annual publications by A/c 20,000
payee cheque)

Computer acquired on
1.11.2023 by A/c payee 30,000
cheque (for professional use)

Domestic drawings 2,72,000

Public provident fund

20,000
subscription

Motor car maintenance 10,000

Closing balance (31.3.2024)

19,15,000
Cash on hand and at Bank

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 62,50,000 62,50,000

Following further information is given to you:

(1) He occupies 50% of the building for own residence and let out the balance for residential
use at a monthly rent of Rs. 5,000. The building was constructed during the year 1997-98,
when the housing loan was taken.

(2) Motor car was put to use both for official and personal purpose. One fifth of the motor car
use is for personal purpose. No car loan interest was paid during the year.

(3) The written down value of assets as on 1-4-2023 are given below:

Furniture & Fittings Rs. 60,000

Plant & Machinery (Air-conditioners, Photocopiers, etc.) Rs. 80,000

Computers Rs. 50,000

Assumptions:

Mr. Mohan has shifted out of the default tax regime under section 115BAC.

1.1 What is the total income of Mr. Mohan for A.Y. 2024-25?

a) ₹23,30,500

b) ₹ 24,92,500

c) ₹25,24,500

d) ₹23,48,500

1.2 How much is the Net Income from House Property for Mr. Mohan?

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a) ₹ 30,000

b) ₹ (2,000)

c) ₹ (32,000)

d) ₹60,000

1.3 What is Mr. Mohan’s net professional income for the A.Y. 2024-25?

a) ₹ 25,24,500
b) ₹ 26,02,000
c) ₹ 59,38,000
d) ₹58,60,500

1.4 How much is the total deduction under Section 80 for Mr. Mohan?

a) ₹1,20,000
b) ₹1,24,000
c) ₹1,62,000
d) ₹1,44,000

1.5 What is the total depreciation claimed by Mr. Mohan for the A.Y. 2024-25?

a) Rs. 77,500
b) Rs. 25,500
c) Rs. 52,000
d) Rs. 1,05,000

(5 x 2 = 10 Marks)

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General MCQ

1. Mrs. Anita, an individual operating a Beauty Parlour named "Elegance Enclave," has
undergone an audit of her books for the financial year ending on 31st March 2024, as required
by section 44AB. Her total income for the Assessment Year 2024-25 is ₹6,20,000. She wishes
to file her return of income for A.Y. 2024-25 through a tax return preparer. Can she proceed
with this approach?

a) Yes, because the audit under section 44AB is not a hindrance to using a Tax Return
Preparer under section 139B.
b) No, because section 139B does not allow individuals who have undergone an audit under
section 44AB to use a Tax Return Preparer.
c) Yes, because the total income of Mrs. Anita is below the threshold for audit under section
44AB.
d) No, because the scheme under section 139B is not applicable to individuals engaged in a
Beauty Parlour business.

2. ABC Pvt. Ltd. engages Mr. A, a contractor, for various contract works during the P.Y. 2023-
24. The company makes the following payments to Mr. A:

₹20,000 on 1st May 2023

₹25,000 on 1st August 2023

₹28,000 on 1st December 2023

A payment of ₹30,000 is due to Mr. A on 1st March 2024.

Discuss whether ABC Pvt. Ltd. is liable to deduct tax at source under section 194C from
payments made to Mr. A.

a) No, because individual contract payments made to Mr. A do not exceed ₹30,000 each.
b) Yes, because the aggregate amount paid to Mr. A during the P.Y. 2023-24 exceeds
₹1,00,000.

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c) No, because the total payment due to Mr. A on 1st March 2024 is below the threshold for
TDS deduction.
d) Yes, because TDS provisions under section 194C are applicable regardless of the total
payment amount.

3. Ms. Neha, a resident individual in India, opted for shifting out of the default tax regime
under section 115BAC(1A) for the previous year 2023-24. She made the following
deposit/payment during the year:

Contribution to the Public Provident Fund (PPF): ₹1,50,000

Insurance premium paid on the life of her spouse (policy taken on 1st April 2018 with an
assured value of ₹2,00,000): ₹25,000

What is the deduction allowable under section 80C for A.Y. 2024-25 if Ms. Neha has exercised
the option of shifting out of the default tax regime provided under section 115BAC(1A)?

a) ₹1,50,000
b) ₹1,70,000
c) ₹25,000
d) ₹1,45,000

4. Mr. Arjun, during the previous year 2023-24, has the following income and brought forward
losses:

Short term capital gains on the sale of shares: ₹1,50,000

Long term capital loss of A.Y. 2022-23: (₹96,000)

Short term capital loss of A.Y. 2023-24: (₹37,000)

Long term capital gain u/s 112: ₹75,000

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What is the taxable capital gains in the hands of Mr. Arjun for the Assessment Year 2024-25?

a) ₹1,50,000
b) ₹1,13,000
c) Nil
d) ₹37,000

5. Mr. and Mrs. Smith hold shares carrying 25% voting power in X (P) Ltd. Mrs. Smith works
as a computer software programmer in X (P) Ltd. at a salary of 30,000 per month. She is,
however, not qualified for the job. The other income of Mr. Smith and Mrs. Smith are 8,00,000
and Rs. 5,00,000, respectively. What is the gross total income of Mr. and Mrs. Smith for the
Assessment Year 2024-25?

a) Mr. Smith 8,00,000 :Mr. Smith 5,00,000

b) Mr. Smith 11,70,000 :Mr. Smith 5,00,000
c) Mr. Smith 11,10,000 :Mr. Smith 5,00,000
d) Mr. Smith 12,10,000 :Mr. Smith 5,00,000

(5 x 1 = 5 Marks)

Division B - Descriptive Questions

Question No. 1 is compulsory.

Attempt any two questions out of remaining three questions

Q-1

Mr. Sharma, an entrepreneur, established a manufacturing unit in a Special Economic Zone

(SEZ) during the financial year 2019-20, specializing in the production of air conditioners. This
unit complies with all the conditions outlined in section 10AA of the Income-tax Act, 1961. In
the subsequent financial year 2022-23, Mr. Sharma diversified his business interests by
setting up a state-of-the-art warehouse in a district of Tamil Nadu, specifically for storing

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agricultural produce. This warehouse meets all the criteria specified under section 35AD of
the Income-tax Act. The total capital expenditure incurred for the warehouse project
amounted to ₹89 lakhs, which includes the cost of land valued at ₹10 lakhs. The warehouse
commenced operations on 1st April 2023, with the entire expenditure of ₹89 lakhs capitalized
in the books on that date.

For the financial year 2023-24, the following details are provided:

Profit generated by the SEZ unit: ₹50,00,000

Export turnover received in India in convertible foreign exchange on or before 30th

September 2024: ₹90,00,000
Domestic sales of the SEZ unit: ₹30,00,000
Profit from the operation of the warehousing facility (before considering deduction under
Section 35AD): ₹1,15,00,000
Compute income-tax (including AMT under Section 115JC) liability of Mr. Sharma for A.Y.
2024-25 both as per section 115BAC and as per regular provisions of the Income-tax Act, 1961
for A.Y. 2024-25. Advise Mr. Sharma whether he should pay tax under default tax regime or
normal provisions of the Act.

(15 Marks)

Q-2(a)

Mr. Siddharth, an individual, has provided the following details of his income for the financial
year ending on March 31, 2024. Compute his total income for the assessment year 2024-25
under the three different residential statuses –

(i) Resident and ordinary resident,

(ii) Resident but not ordinarily resident, and

(iii) Non-resident.

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(a) Short term capital gains on the sale of shares of an Indian Company, received in Germany:
₹ 20,000

(b) Dividend from a Japanese Company, received in Japan: ₹ 15,000

(c) Rent from property in London deposited in a bank in London, later on remitted to India
through approved banking channels: ₹ 80,000

(d) Dividend from XYZ Ltd., an Indian Company: ₹ 8,000

(e) Agricultural income from land in Maharashtra: Rs. 30,000

(4 Marks)

Q-2(b)

M/s Kavya Enterprises, a company engaged in various business activities, made several
payments during the financial year 2023-24. Compute the amount of tax deduction at source
(TDS) required on these payments in accordance with the provisions of the Income-tax Act,
1961. The details of the payments are provided below:

(i) On 1st October 2023, M/s Kavya Enterprises made a payment of ₹2,00,000 to Mr. Rajesh,
a transporter who owns 8 goods carriages throughout the previous year and furnished a
declaration to this effect along with his PAN.

(ii) On 1st November 2023, M/s Kavya Enterprises made two separate payments:

₹20,000 as a fee for technical services

₹25,000 as royalty to Mr. Shyam, who possesses a PAN.

(iii) On 30th June 2023, M/s Kavya Enterprises made a payment of ₹20,000 to M/s Zephyr
Constructions Ltd. for the repair of a building.

(iv) On 1st January 2024, M/s Kavya Enterprises made a payment of ₹2,10,000 to Mr. Ankit
for the purchase of diaries, manufactured according to the specifications of M/s Kavya

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Enterprises. However, no material was supplied for such diaries by M/s Kavya Enterprises or
its associates.

(v) On 1st January 2024, M/s Kavya Enterprises made a payment of ₹2,20,000 to Mr. Bharat
for the compulsory acquisition of his house as per the law of the State Government.

(vi) On 1st February 2024, M/s Kavya Enterprises made a payment of commission amounting
to ₹14,500 to Mr. Yuvraj.

Compute the TDS amount applicable to each of these payments.

(6 Marks)

Q-3(a)

Mr. Kabir converts his plot of land, purchased in July 2004 for ₹ 1,00,000, into stock-in-trade
on 31st March 2023. The fair market value as of 31st March 2023 is ₹ 3,50,000. The stock-in-
trade is later sold for ₹ 3,75,000 in the month of January 2024.

Find out the taxable income, if any, and if so, under which head of income and for which
Assessment Year.

Cost Inflation Index: F.Y. 2004-05:113; F.Y. 2022-23: 331; F.Y. 2023-24: 348.

(4 Marks)

Q-3(b)

Mr. Siddharth owns one unit in the Special Economic Zone (SEZ) and another unit in the
Domestic Tariff Area (DTA). He provides the following details for the previous year 2023-24:

Particulars Mr. Siddharth (Rs.) Unit in DTA (Rs.)

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 Total Sales 7,00,00,000 3,00,00,000

Export Sales 6,60,00,000 2,60,00,000

Net Profit 90,00,000 30,00,000

The proceeds from export sales in the SEZ, received in convertible foreign exchange by
30.9.2024, amount to ₹ 4,00,00,000. Mr. Siddharth has opted to shift out of the default tax
regime provided under section 115BAC(1A). Calculate the eligible deduction under section
10AA of the Income-tax Act, 1961, for the Assessment Year 2024-25, in the following
situations:

(i) If both the units were set up and started manufacturing from 22-05-2015.

(ii) If both the units were set up and started manufacturing from 14-05-2019.

(6 Marks)

Q-4(a)

Mr. Y owns a residential house in Delhi. The house consists of two identical units. The first
unit is self-occupied by Mr. Y, and the second unit is rented out for ₹ 8,000 per month. The
rented unit remained vacant for 2 months during the previous year 2023-24. The particulars
of the house for the said year are as follows:

Standard Rent: ₹ 1,70,000 per annum

Municipal Valuation: ₹ 2,00,000 per annum

Fair Rent: ₹ 1,90,000 per annum

Municipal Tax (Paid by Mr. Y): 5% of Municipal Valuation

Light and Water Charges: ₹ 500 per month

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Interest on Borrowed Capital: ₹ 1,800 per month

Lease Money: ₹ 1,200 per annum

Insurance Charges: ₹ 3,000 per annum

Repairs: ₹ 12,000 per annum

Compute the income from house property for Mr. Y for the Assessment Year 2024-25 if he
exercises the option of shifting out of the default tax regime provided under section
115BAC(1A).

(6 Marks)

Q-4(b)

Mr. Sharma, a resident individual, provides the following details of his income and other
particulars for the previous year 2023-24:

Particulars Amount (₹)

Income from Salary (computed) 17,500

Income from Business 68,500

Long-term Capital Gain on Sale of Land 11,200

Loss on Maintenance of Race Horses 16,500

Loss from Gambling 8,700

Additionally, Mr. Sharma has unabsorbed depreciation and brought forward losses from the
assessment year 2023-24, as follows:

Particulars Amount (₹)

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 Unabsorbed Depreciation 12,500

Loss from Speculative Business 23,500

Short-term Capital Loss 10,200

Compute the Gross Total Income of Mr. Sharma for the Assessment Year 2024-25 and
determine the amount of loss, if any, that can be carried forward.

(4 Marks)

OR

Q-4(b)

Mr. Rajat, engaged in retail trade, reports a turnover of ₹ 2,98,00,000 for the financial year
2023-24. The amount received in cash during the P.Y. 2023-24 is ₹ 15,50,000, and the rest is
through prescribed electronic modes on or before 31st October 2024. His income from the
said business as per books of account is ₹ 16,50,000 computed as per the provisions of
Chapter IV-D “Profits and gains from business or Profession” of the Income-tax Act, 1961.
Retail trade is the only source of income for Mr. Rajat. A.Y. 2023-24 was the first year for
which he declared his business income in accordance with the provisions of presumptive
taxation u/s 44AD.

(i) Is Mr. Rajat also eligible for presumptive determination of his income chargeable to tax for
the assessment year 2024-25?

(ii) If so, determine his income from retail trade as per the applicable presumptive provision.

(iii) In case Mr. Rajat wants to declare profits as per books of account from retail trade, what
are his obligations under the Income-tax Act, 1961?

(iv) What is the due date for filing his return of income under both the options?

(4 Marks)

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 SECTION – B

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 April, 2023.

(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.

Case study 2

“Chanakya Academy” is registered under GST in the State of Uttar Pradesh. The Academy runs
the following educational institutions:

(i) ‘Keshav Institute of Technology’ (KIT), a private engineering college in Ghaziabad. KIT also
runs distance learning post graduate engineering programmes. Exams for such programmes
are conducted in select cities at centres appointed by the KIT. All the engineering courses
including the distance learning post graduate engineering programme run by KIT are
recognised by the law [The All India Council for Technical Education (AICTE)].

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(ii) ‘Little Millennium’, a pre-school in Lucknow.

(iii) ‘Bright Minds’, a coaching institute in Kanpur. The Institute provides coaching for Institute
of Banking Personnel Selection (IBPS) Probationary Officers Exam.

(iv) ‘Spring Model’ a higher secondary school affiliated to CBSE Board. The Academy provides
the following details relating to the expenses incurred by the various institutions run by it
during the period April to September:

S. Little
Particulars KIT Bright Minds Spring Model
No. Millennium

(Rs.) (Rs.) (Rs.) (Rs.)

Printing services for

printing the question
(i) papers (paper and 2,50,000 1,50,000 2,00,000
content are provided by
the Institutions)

Paper procured for

(ii) printing the question 4,30,000 2,58,000 3,44,000
papers

Honorarium to paper
setters and examiners
(iii) 5,00,000
(not on the rolls of the
Institution)

Rent for exam centers

(iv) taken on rent like 8,00,000 1,00,000

schools etc., for

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 conducting
examination

Subscription for online

educational
journals[Little
Millennium has taken
(v) 4,00,000 80,000 2,20,000 2,40,000
the subscription for
online periodicals on
child development and
experiential learning]

Hire charges for buses

used to transport
7,50,000
students and faculty
(vi) 4,80,000 5,50,000 1,30,000
from their residence to
the institutions and
back

Catering services for

running a canteen in
the campus for
students(Catering
services for KIT include
(vii) 3,20,000 2,60,000 1,80,000 5,00,000
a sum of Rs. 60,000 for
catering at a student
event organised in a
banquet hall outside
the campus)

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 Security and
housekeeping services
for the institution(s)
(Security and
housekeeping services
for Spring Model
include a sum of Rs.
(viii) 6,00,000 4,00,000 3,75,000 4,65,000
80,000 payable for
security and
housekeeping at the
student event
organised in a banquet
hall outside the
campus)

The academy further provides the following details relating to the receipts of the various
institutions run by it during the period April 20XX to September 20XX:

Table 2

Little
S. No. Particulars KIT Bright Minds Spring Model
Millennium

(Rs. ) (Rs. ) (Rs. ) (Rs. )

(i) Tuition fee 35,00,000 15,00,000 20,00,000 25,00,000

Transport fee
(ii) charged from 5,00,000 6,00,000 1,30,000 8,50,000
students

With the help of the above details –

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(i) determine the amount of GST payable, if any, on goods and services received during
April 20XX- September 20XX by the various educational institutions run by the ‘Chanakya
Academy’;

(ii) compute net GST liability of the ‘Chanakya Academy’ payable from the Electronic

Cash Ledger, for the period April 20XX to September 20XX. All the amounts given above are
exclusive of taxes, wherever applicable. Notes:

(i) Rate of GST on goods is 12%, catering service is 5% and on other services is 18%.

(ii) Wherever relevant, all the conditions necessary for availing the IT C have been complied
with.

1.1 What is the total amount of GST payable by Keshav Institute of Technology (KIT) for the
period April to September?

a) 2,62,000
b) 1,94,400
c) 1,90,400
d) 2,06,400

1.2 What is the total amount of GST payable by Little Millennium for the period April to
September?

a) 75,500
b) 14,400
c) 88,600
d) 71,500

1.3 What is the total amount of GST payable by Bright Minds for the period April to
September?

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a) 1,06,200
b) 1,15,800
c) 2,15,460
d) 1,10,600

1.4 What is the total amount of GST payable by Spring Model for the period April to
September?

a) 98,880
b) 68,400
c) 66,000
d) 71,400

1.5 Which institution incurred the highest GST liability for the period April to September?

a) Keshav Institute of Technology (KIT)

b) Little Millennium
c) Bright Minds
d) Spring Model

(5 x 2 = 10 Marks)

General MCQ

1. Mohan Footwear Pvt. Ltd., registered in Haryana, sold shoes to a retail seller in Rajasthan
at a value of ₹55,000 (excluding GST leviable @ 12%) and intends to send the consignment of
such shoes to Rajasthan. The consignment value will be ₹61,600 [₹55,000 × 112%].

Is it mandatory to issue an e-way bill for the movement of goods in this case?

a) Yes, because the consignment value exceeds ₹50,000 and the movement of goods is in
relation to the supply of goods.

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b) No, because the consignment value after including GST does not exceed ₹50,000.
c) Yes, because the movement of goods is between different states.
d) No, because the consignment value before including GST is below ₹50,000.

2. Shri Krishna Charitable Trust, a religious trust registered under section 12AB of the Income-
tax Act, owns and manages a temple in their locality. It rents the commercial shops located in
the precincts of the temple for a rent of ₹12,000 per month per shop.

Is the consideration received by Shri Krishna Charitable Trust liable to GST?

a) Yes, because the consideration received exceeds ₹10,000 per month per shop, making
the services taxable under GST.
b) No, because religious trusts are exempt from GST on all services rendered, irrespective
of the consideration received.
c) Yes, because services provided by religious trusts are exempt from GST only when the
consideration is less than ₹10,000 per month per shop.
d) No, because renting of commercial shops by religious trusts is specifically exempt from
GST, regardless of the consideration received.

3. Yellow Lime Pvt. Ltd., Red Chili Pvt. Ltd., and Blueberry Delights Pvt. Ltd. had turnovers of
1.5 crore, 4.8 crore, and ` 6 crore, respectively, in the previous financial year. For reporting
the goods sold to registered and unregistered persons, specific rules apply regarding the HSN
(Harmonized System of Nomenclature) codes. Yellow Lime Pvt. Ltd. and Red Chili Pvt. Ltd. are
required to upload 4 digits of HSN code for goods sold to registered persons, while it's
optional for sales to unregistered persons. On the other hand, Blueberry Delights Pvt. Ltd.
must upload 6 digits of HSN code for all sales. Which of the following statements regarding
the requirement of uploading HSN codes is accurate?

a) Yellow Lime Pvt. Ltd. and Red Chili Pvt. Ltd. must upload 4 digits of HSN code for all sales,
regardless of the registration status of the buyer.

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b) Yellow Lime Pvt. Ltd. and Red Chili Pvt. Ltd. must upload 4 digits of HSN code only for
sales to unregistered persons, while it's optional for sales to registered persons.
c) Blueberry Delights Pvt. Ltd. must upload 6 digits of HSN code for sales to registered
persons, while it's optional for sales to unregistered persons.
d) Blueberry Delights Pvt. Ltd. must upload 6 digits of HSN code for all sales, regardless of
the registration status of the buyer.

4. Sarabhai Trading Pvt. Ltd. commenced its business of supplying goods on 1st April in Delhi.
The turnover of the company exceeded the applicable threshold limit on 3rd September,
making it liable for registration on that date. It applied for registration on 29th September
and was granted the registration certificate on 5th October. Since it applied for registration
within 30 days of becoming liable, the registration granted is effective from 3rd September.
Given this scenario, when may Sarabhai Trading Pvt. Ltd. issue Revised Tax Invoices for taxable
supplies effected between 3rd September and 5th October?

a) Sarabhai Trading Pvt. Ltd. may issue Revised Tax Invoices on or before 3rd November.
b) Sarabhai Trading Pvt. Ltd. may issue Revised Tax Invoices on or before 5th October.
c) Sarabhai Trading Pvt. Ltd. may issue Revised Tax Invoices on or before 5th November.
d) Sarabhai Trading Pvt. Ltd. may issue Revised Tax Invoices on or before 29th October.

5. Mr. Shantaram, CEO of Shaurya Ltd., Mumbai (a company registered in Maharashtra),

purchases insurance cover for the inventory stored in the company's factory located at
Mumbai from Excellent Insurers, Chennai (registered in Tamil Nadu). According to GST
regulations, where would the place of supply be in this transaction?

a) Mumbai, Maharashtra
b) Chennai, Tamil Nadu
c) Both Mumbai and Chennai
d) None of the above

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 (5 x 1 = 5 Marks)

Division B - Descriptive Questions

Question No. 5 is compulsory.

Attempt any two questions out of remaining three questions

Q-5(a)

Ramesh & Sons, a supplier of goods, operates under the regular GST scheme. In a particular
tax period, the company reported the following outward taxable supplies:

Intra-State supply of goods: ₹15,00,000

Inter-State supply of goods: ₹12,00,000

Additionally, the company provided details regarding its purchases during the same tax
period:

Intra-State purchases of goods: ₹4,50,000

Inter-State purchases of goods: ₹3,75,000

Ramesh & Sons had the following opening balance of Input Tax Credits (ITCs) for the tax
period:

CGST: ₹75,000

SGST: ₹80,000

IGST: ₹1,80,000

Additional Notes:

The applicable rates for CGST, SGST, and IGST are 9%, 9%, and 18% respectively.

All inward and outward supplies are exclusive of taxes, wherever applicable..

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All conditions necessary for availing Input Tax Credit (ITC) have been met.

Compute the minimum GST payable in cash by Ramesh & Sons for the tax period, and
determine the amount of ITC to be carried forward to the next month. Make suitable
assumptions as required.

(10 Marks)

Q-5(b)

XYZ Hospital and ABC Housing Society are two entities providing various services. Let's explore
the GST exemptions for the following scenarios:

(i) XYZ Hospital operates a canteen that provides food to its in-patients based on doctors'
recommendations. Determine whether the food supplied by the hospital's canteen to the in-
patients is exempt from GST or not. Provide reasons for your answer.

(ii) ABC Housing Society, a registered Resident Welfare Association (RWA), collects
maintenance charges of ₹6,500 per month per member. Determine the GST implications on
the maintenance charges collected by the RWA and provide the reasons for your conclusion.

(5 Marks)

Q-6(a)

Petal Blossom Pvt. Ltd., a registered supplier based in Mumbai, manufactures taxable goods.
During the month of April, it provides the following details of taxable inter-State supply:

1. List price of taxable goods supplied inter-State (exclusive of taxes): ₹25,00,000

2. Subsidy received from the Central Government for supply of taxable goods to
Government School (exclusively related to supply of goods included at S. No. 1):
₹3,50,000
3. Subsidy received from a charitable foundation for supply of taxable goods to orphanages
(exclusively related to supply of goods included at S. No. 1): ₹75,000

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4. Tax levied by the Municipal Corporation: ₹30,000
5. Packing charges: ₹20,000
6. Late fee paid by the recipient of supply for delayed payment of consideration (Recipient
has agreed to pay ₹9,000 in lump sum inclusive of GST and no additional amount is
payable by him over and above such amount): ₹9,000

The list price of the goods is net of the two subsidies received. However, the other
charges/taxes/fee are charged to the customers over and above the list price.

Calculate the total value of taxable supplies made by Petal Blossom Pvt. Ltd. during the month
of April. Assume the rate of IGST is 18%.

(5 Marks)

Q-6(b)

(a) XYZ Textiles Ltd. operates a textile manufacturing factory in Jaipur and a distribution depot
in Kolkata. Both establishments are registered in their respective states. XYZ Textiles regularly
transfers finished textile products from the factory in Jaipur to the depot in Kolkata without
any consideration, intending to sell them from the depot.

(b) Ananya is a fashion designer in Bangalore. His brother who is settled in New York is a well-
known lawyer. Ananya has taken legal advice from him free of cost with regard to his family
dispute.

Examine whether the activities described in scenarios (a) and (b) would amount to supply
under Section 7 read with Schedule I of the Indian Goods and Services Tax (GST) Act.

(5 Marks)

Q-7(a)

Snehal Steel Suppliers, a registered company based in Gujarat, specializes in trading

industrial-grade iron and steel products. The proprietor of Snehal Steel Suppliers entered into
a sales agreement with a retailer in Rajasthan for the supply of TMT Iron bars, attracting GST

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at the rate of 18%. The agreed value of the goods is ₹50,000 (excluding GST), and an additional
transportation cost of ₹8,000 has been separately charged for delivering the goods to the
retailer's premises in Rajasthan. Determine whether an e-way bill is required to be issued
under GST.

(3 Marks)

Q-7(b)

Determine the effective date of registration in the following cases:

(i) Rahul Enterprises, a construction company based in Mumbai, has seen its aggregate
turnover surpass the threshold limit of ₹40 lakh on 1st june. The company submits its
application for registration on 20th june, and the registration certificate is granted on 25th
june.
(ii) Sharma Textiles, a textile manufacturing company in Ahmedabad, Gujarat, crosses the
threshold limit of ₹20 lakh on 25th November. The company submits its application for
registration on 27th December, and the registration certificate is granted on 5th January.

(3 Marks)

Q-7(c)

M/s Everest Enterprises, a registered business based in Pune, Maharashtra, failed to file the
GST return (GSTR-3B) for the month of April within the specified due date. The delay in filing
is due to the company's accounting department finalizing the books for April, which were
concluded in June. As a result of the delay, the GST Common portal prompted Everest
Enterprises to pay late fees under Section 47 of the CGST Act, 2017, amounting to ₹3,000 each
for CGST and SGST.

The accountant of Everest Enterprises, sought your confirmation for payment of such late
fees using the balance available in the Electronic Credit Ledger. Provide your guidance in this
regard.

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 (4 Marks)

Q-8(a)

Ramesh is a chartered accountant running a proprietorship firm named Ramesh & Associates
in Bangalore. His firm is registered under GST with the GSTIN number 29ABCDEFG1234Z5.

Ramesh's friend Suresh runs a small trading business named Suresh Traders that has an
annual turnover of Rs. 60 lakhs. Suresh wants to file his quarterly GST returns but is unsure of
the process. He approaches Ramesh for help.

Ramesh tells Suresh that since his CA firm is registered under GST, he can also provide services
as a GST Practitioner. Ramesh says he can file GST returns on behalf of Suresh Traders for a
small fee.

Is Ramesh's understanding correct? Can he legally provide GST return filing services to Suresh
Traders by positioning himself as a GST Practitioner? Discuss with suitable justifications.

(5 Marks)

OR

Q-8(a)

ABC Legal Consultants, a firm of lawyers based in Chennai, issued an invoice for legal services
rendered to Mr. Rahul on 7th November. Determine the time of supply in the following
independent cases:

(1) The provision of legal services was completed on 1st October, and payment was received
on 28th November.

(2) The provision of legal services was completed on 14th October, and payment was received
on 28th November.

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(3) Mr. Rahul made the payment on 3rd October. However, the provision of legal services was
remaining to be completed at that time.

(4) Mr. Rahul made the payment on 15th November. However, the provision of legal services
was remaining to be completed at that time.

(5 Marks)

Q-8(b)

(i) Mr. Arjun, a resident of Pune, Maharashtra, travels to Goa and avails banking services from
Axis Bank located in Panaji, Goa. Determine the place of supply for these banking services.

(ii) Ms. Riya, an unregistered individual residing in Noida, Uttar Pradesh, takes a SpiceJet flight
from Delhi to Bengaluru and purchases travel insurance from SBI General Insurance in Delhi.
Identify the place of supply for the travel insurance services.

(iii) Mr. Raj, an unregistered resident of Jaipur, Rajasthan, travels to Chennai, Tamil Nadu, and
obtains a health insurance policy for himself from Reliable Insurers, a registered insurance
provider in Chennai. Explore the place of supply for the health insurance services.

(5 Marks)

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