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Practice Problems On Incidence of Tax
Practice Problems On Incidence of Tax
Problem No.1
X, an Indian national, comes to India during May 2013 to settle here permanently. During April
1993 and April 2013, he was in Australia and never came to India. Find out whether the
following incomes are taxable in India for the assessment year 2014-15:
1. He has received dividend of Rs. 19, 40,000 from Reliance Industries, an India company.
2. He has 1,000 shares in A Inc., an American company. During the financial year 2013-14,
he has received a dividend of US $ 32,000. It is deposited in his bank account in the
Netherlands. After coming back to India he wants to keep this money in the foreign bank
with the approval of RBI.
3. He has two sons A (19 years) and B (14years). Both are university students in Germany.
Income of A in India is Rs.79, 000 and outside India US $ 43,000. Income B in India is
Rs. 2, 00,000 and outside India US $ 5,000.
4. In April 2013, he has transferred equity shares in Tata Chemicals. These shares were
purchased in 1988. Amount of capital profit from this transaction is Rs. 80, 00,000. These
shares were transferred on his behalf by his broker in the Bombay Stock Exchange.
5. He has received a sum of Rs. 80, 00,000 on the death of his uncle by Will. The amount
received in December 2013 and it is deposited in Chennai Branch of Citibank.
Problem No.2
X is a citizen of South Africa. He comes to India for the first time for a visit of 250 days
on October 10, 2013. During the previous year ending 2013-14, he gets the following
fees for technical services:
Rs.
8,00,000
9,00,000
10,00,000
11,00,000
2,00,000
3,00,000
2,10,000
3,10,000
Determine the amount of net income chargeable to tax in the hands of X for the assessment year
2014-15.
Problem No.3
From the information given below, determine the net of X ltd. For the assessment year 2014-15.
Business of X ltd. is controlled from outside India. All shareholders are non-resident and foreign
citizens.
1. Situation 1 X Ltd. is an Indian company.
2. Situation 2 X Ltd. is a foreign company.
Rs.
2,95,000
9,00,000
6,30,000
2,00,000
3,80,000
10,00,000
4,00,000
7,00,000
6,10,000
2,80,000
19,00,000
18,00,000