Solapur University Question Paper
M.Com. – II (Semester – IV) Examination, 2014
TAXATION (Paper – III) (Group – C)
Day and Date : Thursday, 24-4-2014 Total Marks : 50
Time : 3.00 p.m. to 5.00 p.m.
Instructions : 1) All questions are compulsory.
2) Figures to the right indicate full marks.
1. Select the correct choice : 10
1) The relevant date to determine the rate of duty in the case of goods entered
for export is
a) The date of ‘let export’ order by the proper officer permitting export and
loading of cargo on board under Section 51 of the Customs Act, 1962
b) The date of payment of duty
c) The date of invoice
d) None of the above
2) The relevant section of the Customs Act, 1962 which deals with the refund
of export duty is
a) Section 26 b) Section 26 A
c) Section 27 d) Section 28
3) Which of the following duties is covered under the First Schedule of the
Central Excise Tariff Act ?
a) Basic Excise Duty b) Special Excise Duty
c) Additional Excise Duty d) Education Cess
4) Which of the following duties is under the purview of the State Government ?
a) Central Excise Duty b) Customs Duty
c) Service Tax d) VAT
SLR-N – 69 -2-
5) Captively Consumed Goods means
a) Goods manufactured and consumed with in the factory
b) Goods manufactured
c) Goods purchased and used in the factory
d) Goods received from branch
6) Interconnected undertakings means
a) Head office and Branch office
b) Holding and subsidiary companies
c) Group of companies
d) Companies under the same management
7) Wealth tax is payable if net wealth of the assessee exceeds
a) Rs. 1,00,00,000 b) Rs. 30,00,000
c) Rs. 60,00,000 d) None of the above
8) In case an individual is a foreign national but resident and ordinarily resident
in India, the net wealth shall
a) Include assets wherever located whether in India or outside
b) Include assets which are located in India
c) Not include any assets
9) Assets of minor child is included to the net wealth of
a) Father or mother whose net wealth before such clubbing is greater
b) Father or mother whose net wealth after such clubbing is greater
c) Father or mother whose net income is greater
d) None of the above
10) The due date for furnishing the wealth tax return shall be
a) 30th June of the Assessment Year
b) 31st October of the Assessment Year
c) 31st July of the Assessment Year
d) The date mentioned u/s 139(1) of the Income Tax Act, 1961
-3- SLR-N – 69
2. Write short notes on any two from the following : 10
a) Assets which are exempt under the Wealth Tax Act
b) Valuation of the property under Wealth Tax Rules
c) Captive Consumption under Central Excise Act
d) Registration under the Central Excise Act
e) Import procedure under Customs Act.
3. A) Contracted Sale price for delivery at buyer’s premisses Rs. 45,00,000. How
will the assessable value under the subject transaction be determined under
section 4 of the Central Excise Act, 1944 ? Give reasons with suitable
assumptions where necessary. The contracted sale price includes the following
elements of cost : 10
Amount Rs.
i) Excise duty 5,56,000
ii) Octroi 47,500
iii) Cost of drawings and designs 20,000
iv) Actual freight and insurance from ‘place of removal’ to buyers
premises 2,11,500
v) Cost of primary packing 15,000
vi) Cost of packing at buyer’s request for safety during transport 35,000
vii) VAT (Sales tax) 1,85,000
viii) Freight and insurance charges paid from factory to ‘place of
removal’ 1,00,000
B) Akshay Raj and Co. furnish the following expenditure incurred by them and
want you to find the assessable value for the purpose of paying excise duty
on captive consumption. Determine the cost of production in terms of rule 8
of the Central Excise Valuation :
Amount Rs.
i) Direct material cost per unit (inclusive of excise @ 10%) 8,800
ii) Direct Wages 2,500
iii) Factory overheads 2,000
iv) Indirect materials 750
v) Sale of scrap realized 200
vi) Other direct expenses 1,000
vii) Quality control 250
viii) Administrative overhead 1,000
(25% relating to production capacity)
ix) Selling and distribution expense 1,500
x) Actual profit margin 15%
4. A) Boston Philips Ltd. owns the following assets on 31-3-2013 : 10
i) Land situated in rural area : Book value Rs. 18,00,000.
ii) Unused land situated in urban area, purchased on 7-8-2003 for construction
of factory. Book value Rs. 50,00,000. Value as per Schedule III to the
Wealth-tax Act, 1957 : Rs. 62,00,000.
iii) Motor Car : Written down value Rs. 14,00,000. Value as per Schedule III
to the Wealth-tax Act, 1957 : Rs. 15,00,000.
-5- SLR-N – 69
iv) Residential house : Written down value Rs. 8,00,000. Value as per Schedule
III to the Wealth-tax Act, 1957 : Rs. 9,80,000.
v) Gold and Silver : Book value Rs. 2,20,000. Value as per Schedule III to the
Wealth-tax Act, 1957 : Rs. 64,00,000.
vi) Share in companies : Book value Rs. 30,00,000. Quoted Value : Rs. 34,00,000.
vii) Cash in hand : Rs. 2,80,000
viii) Bank balance : Rs. 18,80,000
ix) Plant and Machinery W.D.V. 10,00,000 cost Rs. 32,00,000, market value
Rs. 12,00,000.
Assuming that the company has borrowed Rs. 8,00,000 for purchase of plant
and machinery (out of which Rs. 8,00,000 is outstanding on 31-3-2013, find out
the wealth tax liability of the company for the assessment year 2013-14.
OR
B) Arvind Syntex Ltd. is a construction company selling residential flats. The
assets of the company are as follows :
Market Value
i) Land in rural area 12,60,000
ii) Land in urban area (construction not permitted as per municipal
laws) 22,50,000
iii) Land in Urban area purchased in 1991 being held in stock in-trade
(construction will commence during June, 2009) 82,50,000
iv) Foreign made motor cars (not being held as on stock-in-trade) 18,60,000
v) Jewellery (not being held as stock-in-trade 21,00,000
SLR-N – 69 -6-
vi) Aircraft 3,67,50,000
vii) Bank balance 6,37,500
viii) Cash in hand as per cash book 3,15,000
ix) Guest house and land appurtenant there to situated at 30 kms
away from the city limits 24,00,000
x) Residential flats of identical size provided to 4 employees for their
use (salary of one of them exceeds Rs. 5,00,000 p.a.) 36,00,000
xi) Residence provided to Managing Director (Salary exceeds
Rs. 5,00,000 p.a.) 24,00,000
xii) Flats, constructed and remaining unsold held as stock-in-trade) 37,50,000
xiii) Residence provided to a whole-time director (salary Rs. 4,80,000
the director owns 35% equity share capital 36,00,000
xiv) The company has taken a loan of 10,50,000 Rs. 12,00,000 and Rs. 12,00,000
and Rs. 2,10,000 for acquiring property Number i), iii) and xi) respectively.
Find out the net wealth of the company for the assessment year 2013-14.
5. A) Define the taxable assets under the Wealth Tax Act. 10
OR
B) i) Virat imported the goods from China worth $ 10,000. The basic customs
duty @10%, Education Cess @ 2@ and Secondary and Higher Education
Cess @ 1%. The Exchange rate was $ 1 = Rs. 62 on date of presentation
of bill of entry.
Find the total customs duty.
-7- SLR-N – 69
ii) The following information is furnished by Radhe Krishna on 8th February
2013 in respect of articles of jewellery imported from USA
FOB Value $ 20,000
Exchange Rate $ 1 = Rs. 61.50
Air Freight $ 4,500
Insurance Charges Not Known
Landing charges Rs. 10,000
Basic Customs Duty @10%
Excise Duty Chargeable on similar goods as per tariff rates 16%
Additional Duty of Customs @ 4%.
Calculate the total custom duty payable by Radhe Krishna.
_____________________
M.Com. – II (Semester – IV) Examination, 2014
TAXATION (Paper – III) (Group – C)
Day and Date : Thursday, 24-4-2014 Total Marks : 50
Time : 3.00 p.m. to 5.00 p.m.
Instructions : 1) All questions are compulsory.
2) Figures to the right indicate full marks.
1. Select the correct choice : 10
1) The relevant date to determine the rate of duty in the case of goods entered
for export is
a) The date of ‘let export’ order by the proper officer permitting export and
loading of cargo on board under Section 51 of the Customs Act, 1962
b) The date of payment of duty
c) The date of invoice
d) None of the above
2) The relevant section of the Customs Act, 1962 which deals with the refund
of export duty is
a) Section 26 b) Section 26 A
c) Section 27 d) Section 28
3) Which of the following duties is covered under the First Schedule of the
Central Excise Tariff Act ?
a) Basic Excise Duty b) Special Excise Duty
c) Additional Excise Duty d) Education Cess
4) Which of the following duties is under the purview of the State Government ?
a) Central Excise Duty b) Customs Duty
c) Service Tax d) VAT
SLR-N – 69 -2-
5) Captively Consumed Goods means
a) Goods manufactured and consumed with in the factory
b) Goods manufactured
c) Goods purchased and used in the factory
d) Goods received from branch
6) Interconnected undertakings means
a) Head office and Branch office
b) Holding and subsidiary companies
c) Group of companies
d) Companies under the same management
7) Wealth tax is payable if net wealth of the assessee exceeds
a) Rs. 1,00,00,000 b) Rs. 30,00,000
c) Rs. 60,00,000 d) None of the above
8) In case an individual is a foreign national but resident and ordinarily resident
in India, the net wealth shall
a) Include assets wherever located whether in India or outside
b) Include assets which are located in India
c) Not include any assets
9) Assets of minor child is included to the net wealth of
a) Father or mother whose net wealth before such clubbing is greater
b) Father or mother whose net wealth after such clubbing is greater
c) Father or mother whose net income is greater
d) None of the above
10) The due date for furnishing the wealth tax return shall be
a) 30th June of the Assessment Year
b) 31st October of the Assessment Year
c) 31st July of the Assessment Year
d) The date mentioned u/s 139(1) of the Income Tax Act, 1961
-3- SLR-N – 69
2. Write short notes on any two from the following : 10
a) Assets which are exempt under the Wealth Tax Act
b) Valuation of the property under Wealth Tax Rules
c) Captive Consumption under Central Excise Act
d) Registration under the Central Excise Act
e) Import procedure under Customs Act.
3. A) Contracted Sale price for delivery at buyer’s premisses Rs. 45,00,000. How
will the assessable value under the subject transaction be determined under
section 4 of the Central Excise Act, 1944 ? Give reasons with suitable
assumptions where necessary. The contracted sale price includes the following
elements of cost : 10
Amount Rs.
i) Excise duty 5,56,000
ii) Octroi 47,500
iii) Cost of drawings and designs 20,000
iv) Actual freight and insurance from ‘place of removal’ to buyers
premises 2,11,500
v) Cost of primary packing 15,000
vi) Cost of packing at buyer’s request for safety during transport 35,000
vii) VAT (Sales tax) 1,85,000
viii) Freight and insurance charges paid from factory to ‘place of
removal’ 1,00,000
B) Akshay Raj and Co. furnish the following expenditure incurred by them and
want you to find the assessable value for the purpose of paying excise duty
on captive consumption. Determine the cost of production in terms of rule 8
of the Central Excise Valuation :
Amount Rs.
i) Direct material cost per unit (inclusive of excise @ 10%) 8,800
ii) Direct Wages 2,500
iii) Factory overheads 2,000
iv) Indirect materials 750
v) Sale of scrap realized 200
vi) Other direct expenses 1,000
vii) Quality control 250
viii) Administrative overhead 1,000
(25% relating to production capacity)
ix) Selling and distribution expense 1,500
x) Actual profit margin 15%
4. A) Boston Philips Ltd. owns the following assets on 31-3-2013 : 10
i) Land situated in rural area : Book value Rs. 18,00,000.
ii) Unused land situated in urban area, purchased on 7-8-2003 for construction
of factory. Book value Rs. 50,00,000. Value as per Schedule III to the
Wealth-tax Act, 1957 : Rs. 62,00,000.
iii) Motor Car : Written down value Rs. 14,00,000. Value as per Schedule III
to the Wealth-tax Act, 1957 : Rs. 15,00,000.
-5- SLR-N – 69
iv) Residential house : Written down value Rs. 8,00,000. Value as per Schedule
III to the Wealth-tax Act, 1957 : Rs. 9,80,000.
v) Gold and Silver : Book value Rs. 2,20,000. Value as per Schedule III to the
Wealth-tax Act, 1957 : Rs. 64,00,000.
vi) Share in companies : Book value Rs. 30,00,000. Quoted Value : Rs. 34,00,000.
vii) Cash in hand : Rs. 2,80,000
viii) Bank balance : Rs. 18,80,000
ix) Plant and Machinery W.D.V. 10,00,000 cost Rs. 32,00,000, market value
Rs. 12,00,000.
Assuming that the company has borrowed Rs. 8,00,000 for purchase of plant
and machinery (out of which Rs. 8,00,000 is outstanding on 31-3-2013, find out
the wealth tax liability of the company for the assessment year 2013-14.
OR
B) Arvind Syntex Ltd. is a construction company selling residential flats. The
assets of the company are as follows :
Market Value
i) Land in rural area 12,60,000
ii) Land in urban area (construction not permitted as per municipal
laws) 22,50,000
iii) Land in Urban area purchased in 1991 being held in stock in-trade
(construction will commence during June, 2009) 82,50,000
iv) Foreign made motor cars (not being held as on stock-in-trade) 18,60,000
v) Jewellery (not being held as stock-in-trade 21,00,000
SLR-N – 69 -6-
vi) Aircraft 3,67,50,000
vii) Bank balance 6,37,500
viii) Cash in hand as per cash book 3,15,000
ix) Guest house and land appurtenant there to situated at 30 kms
away from the city limits 24,00,000
x) Residential flats of identical size provided to 4 employees for their
use (salary of one of them exceeds Rs. 5,00,000 p.a.) 36,00,000
xi) Residence provided to Managing Director (Salary exceeds
Rs. 5,00,000 p.a.) 24,00,000
xii) Flats, constructed and remaining unsold held as stock-in-trade) 37,50,000
xiii) Residence provided to a whole-time director (salary Rs. 4,80,000
the director owns 35% equity share capital 36,00,000
xiv) The company has taken a loan of 10,50,000 Rs. 12,00,000 and Rs. 12,00,000
and Rs. 2,10,000 for acquiring property Number i), iii) and xi) respectively.
Find out the net wealth of the company for the assessment year 2013-14.
5. A) Define the taxable assets under the Wealth Tax Act. 10
OR
B) i) Virat imported the goods from China worth $ 10,000. The basic customs
duty @10%, Education Cess @ 2@ and Secondary and Higher Education
Cess @ 1%. The Exchange rate was $ 1 = Rs. 62 on date of presentation
of bill of entry.
Find the total customs duty.
-7- SLR-N – 69
ii) The following information is furnished by Radhe Krishna on 8th February
2013 in respect of articles of jewellery imported from USA
FOB Value $ 20,000
Exchange Rate $ 1 = Rs. 61.50
Air Freight $ 4,500
Insurance Charges Not Known
Landing charges Rs. 10,000
Basic Customs Duty @10%
Excise Duty Chargeable on similar goods as per tariff rates 16%
Additional Duty of Customs @ 4%.
Calculate the total custom duty payable by Radhe Krishna.
_____________________
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