AHMEDABAD UNIVERSITY

AMRUT MODY SCHOOL OF MANAGEMENT

2020 MONSOON SEMESTER
DIRECT TAXES- FAC121
EVALUATION TYPE: ASSIGNMENT – 3
TOPIC- CAPITAL GAINS

Total Marks: 25 No. of printed pages: 02

1. X & sons, HUF, purchased a land for ₹1,20,000 in the P.Y. 2002-03 . In the P.Y. 2006-
07, a partition takes place when Mr. A , a coparcener , is allotted this plot valued at ₹
1,50,000. In P.Y. 2007-08, he had incurred expenses of ₹ 2,35,000 towards fencing of the
plot. Mr. A sells this plot of land for ₹15,00,000 in P.Y. 2019-20 after incurring expense
to the extent of ₹20,000. You are required to compute the Capital gain for the Assessment
year 2020-21. Cost Inflation Indices are: 2002-03: 105, 2007-08: 129, 2019-20 is 289.

2. Mr. Roy, aged 55 years owned a Residential House in Ghaziabad. It was acquired by Mr.
Roy on 10-10-2007 for ₹ 24,00,000 . He sold it for ₹ 72,00,000 on 4.11.2019. The
assessee paid 2% of the sale consideration as brokerage on the sale of the said property.
Mr. Roy acquired a residential house property in Kolkata on 10-12-2019 for ₹ 7,00,000
and deposited ₹ 3,00,000 on 10-04-2020 and ₹5,00,000 on 15-6-2020 in the capital gains
bonds of Rural Electrification Corporation Ltd. He deposited ₹ 4,00,000 on 6-7-2020 and
₹9,00,000 on 1-11-2020 in the capital gain deposit scheme in a Nationalized Bank for
construction of an additional floor on the residential house property in Kolkata .
Compute the Capital Gain chargeable to tax for the Assessment year 2020-21 and income
tax chargeable thereon assuming Mr. Roy has no other income.
Cost Inflation Index for Financial Year 2007-08:129, 2019-20: 289.

3. Mr. Martin, a resident individual, sold his residential house property on 08-06-2019 for ₹
80 lakhs which was purchased by him for ₹ 20,50,000 on 05-05-2006. He paid ₹1 lakh as
brokerage for the sale of said property.
He bought another house property on 25-12-2019 for ₹ 15 lakhs.
He deposited ₹5 lakhs on 10-11-2019 in the capital gain bond of National Highway
Authority of India (NHAI)
He deposited another ₹ 10 lakhs on 10-07-2020 in the capital gain deposit scheme with
SBI for construction of additional floor of house property.
Compute income under the head “Capital Gains” for A.Y.2020-21. Cost Inflation Index
for Financial Year 2006-07:122, 2019-20: 289

4. X purchases a house property for ₹26,000 on May 10,1982 . He gets the first floor of the
house constructed in 1987-88 by spending ₹40,000 . He dies on September 12,1998 .This
property is transferred to Mrs. X by his will. Mrs. X spends ₹30,000 and ₹26,700 during

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 1999-00 and 2005-06 respectively for renewals/reconstruction of the property. Mrs X
sells the house property for ₹ 21,50,000 on March 15,2020 (brokerage paid by Mrs X -
11,500 ) . The fair market value of the house on 1.4.2001 is ₹1,60,000. Cost Inflation
Index 2001-02: 100, 2005-06: 117, 2019-20 is 289.

5. Tarun sold the following assets during the previous year 2019-20:

(i) Residential House: This house was purchased in 1980 for Rs.20,000 and was inherited
by Tarun in 1994. Fair market value on 1-4-2001: Rs.2,00,000. Cost of improvement on
the house incurred in 2002-03 Rs.40,000. The house was sold by him on 1-10-2019 for
Rs.22,00,000. Expenses on transfer were Rs.30,000.
(ii) Gold Jwellery costing Rs.1,00,000 (which was acquired in June, 2017) was sold for
Rs.2,00,000 in March 2020. Expenses on transfer Rs.10,000
(iii) Personal Motor Car costing Rs.90,000 purchased in 2001 was sold in March, 2020
for Rs.1,00,000.
(iv) Listed shares sold for Rs.2,50,000 on 5-11-2019. These were purchased in October
2005 for Rs.64,000. STT has been paid on the sale of these shares. FMV of these shares
on 31.1.2019 was Rs. 1,00,000
(v) On 18.6.2019 he sells a painting for Rs.58,00,000 which was purchase during 2005-06
for Rs.24,00,000.
From the above particulars, compute his total income under Capital Gains and CII
are: 2001-02: 100, 2002-03:105, 2005-06: 117, 2003-04:109, and 2019-20:289