CA INTER

Paper 3
INTERMIDIATE: FULL PAPER 1

Taxation
Maximum Time: - 3 Hours Total Marks-100
SECTION A: INCOME TAX LAW (50 Marks)

PART I – MCQ (15 Marks)

Instructions: All Question Compulsory
Write the most appropriate answer to each of the following multiple-choice questions by
choosing one of the four options given.
Q1. Multiple Choice Questions. (1 Mark Each)
Rad Chilli Tech Ltd., a real estate development company, entered into an agreement with Mr.
Yuvraj, a resident individual on 25.6.2019 as per which Mr. Yuvraj agrees to transfer a plot of
land measuring 12 acres in New Delhi to Rad Chilli Tech Ltd. Mr. Yuvraj purchased such
land on 14.7.2017 for ₹ 80,50,000.
Rad Chilli Tech Ltd. has planned to develop a high-rise society of 250 flats on such land.
Inconsideration, Rad Chilli Tech Ltd. paid a part consideration of ₹ 1 crore to Mr. Yuvraj on
the date of agreement and would provide 3 flats in the society to him as final settlement.
The certificate of completion of society was issued by the authority as on 10.8.2023. On such
date, stamp duty value of each flat in the society was ₹ 2,51,00,000. Subsequently on
31.8.2023, Mr. Yuvraj sold 2 flats in the society to Mr. Paul for a consideration of ₹
2,70,00,000 each while the stamp duty value of each flat on such date was ₹ 2,98,00,000.
During the P.Y. 2023-24, Mr. Paul has earned salary income of ₹ 30,50,000.
Out of the proceeds received on sale of land, Mr. Yuvraj has purchased a house on 08.09.2023
for a consideration of ₹ 47,00,000 and occupied for own residence. Mr. Yuvraj has taken a
loan of ₹ 35,00,000 (80% of stamp duty value) from SBI for purchase of such house which
was sanctioned and disbursed at the interest rate of 12% p.a. on 01.07.2023. He does not own
any other residential house on the date of sanction of loan. Mr. Paul and Mr. Yuvraj do not opt
for section 115BAC.
Based on the above facts, choose the most appropriate answer to Q. No. 1 to 5 -
1. What would be the tax, if any, required to be deducted by Rad Chilli Tech Ltd. in respect of
agreement entered into with Mr. Yuvraj?
A. ₹ 10,00,000 B. ₹ 85,30,000 C. ₹ 8,53,000 D. ₹ 1,00,000
2. What would be the capital gain in the hands of Mr. Yuvraj in respect of the agreement

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entered into with Rad Chilli Tech Ltd. and in which year it would be taxable?
A. ₹ 7,59,18,199 in P.Y. 2023-24 B. ₹ 7,20,46,875 in P.Y. 2023-24
C. ₹ 7,72,50,000 in P.Y. 2023-24 D. ₹ 7,67,46,875 in P.Y. 2021-22
3. Determine the capital gain/loss in the hands of Mr. Yuvraj in respect of sale of 2 flats to Mr.
Paul during the P.Y. 2023-24. For the purpose of answering this MCQ, assume that no cash
consideration was paid by Rad Chilli Tech Ltd. to Mr. Yuvraj.
A. ₹ 38,00,000 B. ₹ 47,00,000 C. ₹ 56,00,000 D. ₹ 94,00,000
4. What would be the total income of Mr. Paul for the P.Y. 2023-24?
A. ₹ 30,50,000 B. ₹ 86,50,000 C. ₹ 86,00,000 D. ₹ 30,00,000
5. What would be the total deduction available under the relevant provisions of the Income-
tax Act, 1961 to Mr. Yuvraj for the P.Y. 2023-24 in respect of interest on loan taken from SBI?
A. ₹ 2,00,000 B. ₹ 3,15,000 C. ₹ 3,50,000 D. ₹ 4,20,000
6. Raja a foreign national but a person of Indian origin visited India during previous year
2018-19 for 181 days. During 4 preceding previous years he was in India for 365 days. Raja
shall be:
A. Resident in India B. Non-resident in India C. Not-ordinarily resident in India
D. None of the above
7. If an individual satisfies only basic condition and none of the additional condition he will
be called as …………….
A. Ordinary resident B. Non-ordinary resident C. Non-resident
D. None of the above
8. The benefit of exemption under Section 54F is available when following capital asset
transferred
A. Short term capital asset other than residential house property
B. Short term residential house property
C. Long term residential house property:
D. Any long term capital asset other than residential house property
9. If Mr. & Mrs. Pathak both have substantial interest in a concern and both are in receipt of
remuneration from that concern, then what will be the tax consequences?
A. Remuneration shall be clubbed in the total income of Mrs. Pathak
B. Remuneration shall be clubbed in the total of that individual whose total income (before
this clubbing) is higher
C. Clubbing shall not apply
D. Remuneration shall be clubbed in the total income of Mr. Pathak
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10. Mr. Rishabh, aged 65 yea₹ and a resident in India, has a total income of ₹ 4,50,00,000,
comprising long term capital gain taxable under section 112 of ₹ 85,00,000, long term capital
gain taxable under section 112A of ₹ 75,00,000 and other income of ₹ 2,90,00,000. What
would be his tax liability for A.Y. 2024-25. Assume that Mr. Rishabh has opted for the
provisions of section 115BAC.
A. ₹ 1,41,40,750 B. ₹ 1,38,86,990 C. ₹ 1,38,84,390 D. ₹ 1,39,81,240
11. A building was acquired on 1.4.1995 for ₹20,00,000 and sold for ₹ 80,00,000 on
01.06.2020. The stamp duty value on the date of transfer was ₹ 85,00,000. The fair market
value of the building on 1.4.2010 was ₹ 25,00,000. Its stamp duty value on the same date
was ₹ 22,00,000. Determine the capital gains on sale of such building for the A.Y. 2023-24?
Cost Inflation Index for F.Y. 2010-11: 100; F.Y. 2023-24: 301
A. ₹ 13,78,000 B. ₹ 18,78,000 C. ₹ 9,75,000 D. ₹ 4,75,000
12. Sham Singh spends ₹ 1,00,000 on cultivation and harvesting of his agricultural produce.
50% of the production is sold for ₹1,10,000 and rest is stored for self-consumption. What is
the amount of the agricultural income?
A. ₹ 60,000 B. ₹ 1,10,000 C. ₹ 1,20,000 D. ₹ 1,00,000
13. In case the letting out of property is incidental to the main business, then income from
such property shall be taxable as:
A. Income from Other Sources B. Capital Gain C. Profits & Gains of Business or
Profession D. Income from House Property
14. Mr. Jain, an Indian Citizen and resident of India, earned dividend income of ₹ 4,500 from
an Indian company, which was declared on 1.10.2023 and paid in cash to Mr. Jain. What are
the tax implications with respect to the dividend in the hands of Mr. Jain and Indian Company?
A. Such dividend is taxable in the hands of Mr. Jain and Indian company is required to deduct
tax at source @7.5%.
B. Such dividend is taxable in the hands of Mr. Jain and Indian company is required to deduct
tax at source @10%.
C. Such dividend is taxable in the hands of Mr. Jain. However, Indian company is not
required to deduct tax at source since it does not exceed ₹ 5,000.
D. Such dividend is exempt in the hands of Mr. Jain. Hence, Indian company is not required
to deduct tax at source.
15. Mr. Arpan (aged 35 yea₹) submits the following particular for the purpose of computing
his total income:
Particulars ₹
Income from salary (computed) 4,00,000
Loss from let-out house property (-) 2,20,000
Brought forward loss from let-out house (-) 2,30,000
property for the A.Y. 2024-25
Business loss (-) 1,00,000

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 Bank interest (FD) received 80,000
Compute the total income of Mr. Arpan for the A.Y.2024-25 and the amount of loss that can
be carried forward for the subsequent assessment year?
A. Total income ₹ 2,00,000 and loss from house property of ₹ 2,50,000 and business loss of
₹ 20,000 to be carried forward to subsequent assessment year.
B. Total income ₹ 80,000 and loss from house property of ₹ 2,30,000 to be carried forward
to subsequent assessment year.
C. Total income ₹ 1,80,000 and loss from house property of ₹ 2,30,000 and business loss of
₹ 20,000 to be carried forward to subsequent assessment year.
D. Total income is Nil and loss from house property of ₹ 70,000 to be carried forward to
subsequent assessment year
DESCRIPTIVE QUESTION (35 Marks)
Question No.1 is compulsory
Answer any two questions from the remaining Three questions

Q1A. Mr. Aakash has undertaken certain transactions during the F.Y.2024-25, which are
listed below. You are required to identify the transactions in respect of which quoting of PAN
is mandatory in the related documents – (2 Marks)
S. No. Transaction
1 Payment of life insurance premium of ₹ 45,000 in the
F.Y.2023-24 by account payee cheque to LIC for insuring
life of
self and spouse
2 Payment of ₹ 1,00,000 to a five-star hotel for stay for 5 days
with
family, out of which ₹ 60,000 was paid in cash
3 Payment of ₹ 80,000 by ECS through bank account for
acquiring
the debentures of A Ltd., an Indian company
4 Payment of ₹ 95,000 by account payee cheque to Thomas
Cook
for travel to Dubai for 3 days to visit relatives
5 Applied to SBI for issue of credit card.

1B. Mr. Samrat and his wife, Mrs. Komal, holds 12% voting power each in ABC (P) Ltd. Mr.
Samrat and Mrs. Komal are working in ABC (P) Ltd. However, Mrs. Komal is not qualified
for the job. From the following information given in respect of F.Y. 2023-24, you are required
to compute the gross total income of Mr. Samrat and Mrs. Komal for the A.Y. 2024-25.
(i) Dividend of ₹ 22,500 and ₹ 45,000 is received by Mr. Samrat and M₹. Komal,
respectively, from ABC
(P) Ltd. Mr. Samrat has instructed the company to pay 50%of his dividend to Ms. Kajal,
daughter of his deceased brother.

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(ii) Salary earned by Mr. Samrat and Mrs. Komal from ABC (P) Ltd. is ₹ 8,50,000 and ₹
5,50,000, respectively.
(iii) Business income earned by Mr. Samrat from his sole proprietary business is ₹ 15,60,000
(iv) Interest on fixed deposit earned by M₹. Komal of ₹ 9,00,000.
(v) Their son, Akash, aged 10 years having PAN, received interest of ₹ 54,000 from bank on
a fixed deposit created by his grandfather in his name. (4
Marks)
1C. Examine the applicability of TDS provisions and TDS amount in the following cases:
(a) Rent paid for hire of machinery by B Ltd. to Mr. Raman ₹ 2,60,000 on 27.9.2024.
(b) Fee paid on 1.12.2024 to Dr. Budhwani by Sundar (HUF) 35,000 for surgery performed
on a member of the family. (4 Marks)
1D. Amit takes a land on rent from Ms. Chinmay on monthly rent of ₹. 10,000. He sub-lets
the land to Divya for a monthly rent of ₹ 11,500. Divya uses the land for grazing of cattle
required for agricultural activities. Amit wants to claim deduction of ₹. 10,000 (being rent
paid by him to Ms. Chinmay) from the rental income received by it from Divya. (4 Marks)
Q2A. (a) Examine & explain the TDS implications in the following cases along with reasons
thereof, assuming that the deductees are residents and having a PAN which they have duly
furnished to the respective deducts.
(i) Mr. Prashal received a sum of ₹ 10,20,000 on 28.02.2024 as pre-mature withdrawal from
Employees Provident Fund Scheme before continuous service of 5 years on account of
termination of employment due to ill-health.
(ii) Indian Bank sanctioned and disbursed a loan of ₹ 12 crores to B Ltd. on 31-12-2024. B
Ltd. paid a sum of ₹ 1,20,000 as service fee to Indian Bank for processing the loan
application.
(iii) Mr. Pratham, working in a private company, is on deputation for 5 months (from October,
2023 to February, 2024) at Mumbai where he pays a monthly house rent of ₹ 32,000 for
those five months, totalling to ₹ 1,60,000. Rent is paid by him on the first day of the relevant
month
(b) Mr. Dhomketu engaged in the business of trading of electrical appliances. His turnover for
F.Y. 2022-23 and F.Y. 2023-24 was ₹ 12 crore and 9.5 crore, respectively. During the
previous year, XYZ Ltd. placed order for purchase of electric appliances for ₹ 55 lakhs on
01.08.2023. He again placed order for ₹ 35 lakhs on 01.11.2023. Mr. Dhomketu delivered
both the orders within 15 days of receipt of orders. Discuss, whether Mr. Dhomketu is
required to collect tax at source, on the consideration received from XYZ Ltd.
(5 Marks)
2B. Mr. Elvish has furnished his details for the A.Y.2024-25 as under:
Particulars ₹
Income from salaries (computed) 1,50,000
Income from speculation business 60,000

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 Loss from non-speculation business (40,000)
Short term capital gain 80,000
Long term capital loss of A.Y.2022-23 (30,000)
Winning from lotteries (Gross) 20,000

Compute the total income of Mr. Elvish for the A.Y.2024-25. (4 Marks)
2C. Himadri Investments (P.) Ltd. is incorporated during previous year 2020-21 having a
paid-up capital of ₹. 10 lakh. In order to increase its capital, the company further issues,
1,00,000 shares (having face value of ₹. 100 each) on August 1,2024. Find out the tax
consequences for Himadri Investments (P.) Ltd. in the following three situations -
Situation 1 - Fair market value of these shares is ₹ 85 per share on August 1,2021. However,
Himadri Investments (P.) Ltd. issues these shares at face value ₹. 100 per share.
Situation 2 - Fair market value on August 1,2024 is ₹ 85 per share. However, shares are
issued by the company at the rate of 105 per share
Situation 3 - Fair market value on August 1,2024 is ₹ 120 per share. However, shares are
issued by the company at the rate of 105 per share (5
Marks)
Q3A. Mr. Ayaansh (aged 35 years), a resident individual, is a dealer of garments. During the
previous year 2023-24, total turnover of his business was ₹ 105 lakhs (out of which ₹ 15
lakhs was received by way of account payee cheques and balance in cash). Mr. Ayaansh does
not opt to pay tax as per the provisions of section 115BAC. What would be your advice to Mr.
Ayaansh relating to the provisions of advance tax with its due date along with the amount
payable, assuming that he wishes to make maximum tax savings without getting his books of
account audited. (5
Marks)
3B. Mr. Gourmeet is engaged in the business of plying goods carriages. On 1stApril, 2023, he
owns 10 trucks (out of which 5 are heavy goods vehicles, the gross vehicle weight of such
goods vehicle is 17,000 kg each). On 5thMay, 2023, he sold one of the heavy goods vehicles
and purchased a light goods vehicle on 8thMay, 2023. This new vehicle could however be put
to use only on 15thJuly, 2023. Compute the total income of Mr. Gourmeet for the assessment
year 2024-25, taking note of the following data: (5 Marks)
Particulars ₹. ₹.
Freight charges collected Less : Operational 5,25,500 12,50,500
expenses Depreciation as per section 32 Other 1,85,000 7,27,500
office expenses Net Profit 17,000 5,23,000
Other business and non- business income 70,000

3C. (a) State in brief the applicability of provisions of tax deduction at source, the rate and
amount of tax deduction in the following cases for the financial year 2023-24 under Income-
tax Act, 1961. Assume that all payments are made to residents:

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(i) Mr. Amish has paid ₹ 6,00,000 on 15.10.2024 to M/s Fresh Cold Storage Pvt. Ltd. for
preservation of fruits and vegetables. He is engaged in the wholesale business of fruits &
vegetable in India having turnover of ₹ 3 Crores during the previous year 2023-24.
(ii) Mr. Sonu, a salaried individual, has paid rent of ₹ 60,000 per month to Mr. Poore from
1st July, 2024 to 31st March, 2025. Mr. Poore has not furnished his Permanent Account
Number. (4
Marks) Or
3C. Mr. Hariram, due to inadvertent reasons, failed to file his Income-tax return for the
assessment year 2024-25. on or before the due date of filing such return of income.
(i) Can he file the above return after due date of filing return of income? If yes, which is the
last date for filing the above return?
(ii) What are the consequences of non-filing the return within the due date under
section139(1)? (4 Marks)
4A. X (45 years and his wife Mrs. X (42 years) furnish the following information. (3 Marks)
₹.
Salary income (computed) of Mrs. X 9,60,000
Income of minor son A who suffers from 3,08,000
disability specified in section 80U
Income of minor daughter C from script 1,86,000
writing for television serials
Income from garment trading business of X 17,50,000
Cash gift received by minor daughter C on 45,000
October 2, 2021 from friend of
M₹. X, on winning of a story writing
competition
Income of minor son B form scholarship 1,00,000
received from his school
Income of minor son B from fixed deposit
with PNB, made out of
Income earned from scholarship 5,000

Compute the total income of X and Mrs. X for assessment year 2024-25 assuming that they have not
opted to be taxed under section 115BAC.

4B. Mr. Vishwas for the year ended 31.3.2024, you are requested to compute his total income
and tax payable for the assessment year 2024-25, assuming that he opts out of the default tax
regime under section 115BAC. From the following particular furnished by.
(a) Mr. Vishwas retired on 31.12.2023 at the age of 58, after putting in 26 years and 1 month
of service, from a private company at Mumbai.
(b) He was paid a salary of ₹ 25,000 p.m. and house rent allowance of ₹ 6,000 p.m. He paid
rent of ₹ 6,500 p.m. during his tenure of service.

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(c) On retirement, he was paid a gratuity of ₹ 3,50,000. He was covered by the payment of
Gratuity Act. Mr. Vishwas had not received any other gratuity at any point of time earlier,
other than this gratuity.
(d) He had accumulated leave of 15 days per annum during the period of his service; this was
encashed by Mr. Vishwas at the time of his retirement. A sum of ₹ 3,15,000 was received by
him in this regard. His average salary for last 10 months may be taken as ₹ 24,500. Employer
allowed 30 days leave per annum.
(e) After retirement, he ventured into textile business and incurred a loss of ₹ 80,000 for the
period up to 31.3.2024.
(f) Mr. Vishwas has deposited ₹ 1,00,000 in public provident fund. (5 Marks)
4C. You are required to compute the total income and tax payable by Mr. Nimish, aged 58
years, a resident individual. Mr. Nimish is an advocate and furnishes you the receipts and
payments account for the financial year 2023-24
Receipts ₹ Payments ₹
Opening Balance Staff salary and bonus to clerks 17,50,000
(01-04-2023) Other general and administrative 22,00,000
Cash & Bank 80,000 expenses
Fee from legal services 49,60,000 Office rent 1,48,000
Motor car loan from SBI 5,00,000 Life Insurance Premium (Sum
@12% p.a. interest Assured ₹. 5,00,000 49,000
Motor car (Acquired in January
Sale receipts of 5,800 listed 5,95,000 2024 by way of NEFT 9,50,000
equity shares (sold on 31st Books bought by way of A/c payee
March 2024 cheque in the month of May, June 80,000
and September 2023 (annual
publications)
Computer acquired on 1-11-2023 for 52,000
professional use (payment made by
A/c payee cheque)
Domestic drawings 6,23,000
Motor car maintenance 72,000
Public Provident Fund subscription 1,50,000
Closing balances (31-03-2024) Cash
& Bank 61,000
61,35,000 61,35,000
Other information:
(i) Listed equity shares on which STT was paid were acquired in August 2019 for ₹ 1,21,800.
The fair market value of such shares as on 31st January 2021 and on 1st April 2021 was ₹ 75
per share and ₹. 85 per share, respectively.
(ii) Motor car was put to use for both official and personal purposes.1/3 rd of the motor car is
for personal purpose. No interest on car loan was paid during the previous year 2023-24.
(ii) Mr. Nimish purchased a flat in Kanpur for ₹. 35,00,000 in July 2015 cost of which was
partly financed by a loan from Punjab National Housing Finance Limited of ₹. 25,00,000, his
own-savings. 1,00,000 and a deposit from Repco Bank for ₹. 9,00,000. The flat was given to

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Repco Bank on lease for 10 years @ ₹. 35,000 per month. The following particulars are
relevant:
(a) Municipal taxes paid by Mr. Nimish ₹. 8,200 per annum
(b) House insurance. 11,000
As per interest certificate issued by Punjab National Housing Finance Limited for the
financial year 2023-24, he paid ₹ 1,80,000 towards principal and ₹ 2,01,500 as interest.
(iii) He earned ₹. 1,20,000 in share speculation business and lost ₹. 1,80,000 in commodity
speculation business.
(iv) Mr. Nimish received a gift of ₹. 21,000 each from four of his family friends.
(v) He contributed. 1,21,000 to PM Cares Fund by way of bank draft.
(vi) He donated to a registered political party ₹. 3,50,000 by way of cheque.
(vii) He follows cash system of accounting.
(viii) Cost Inflation Index: F.Y. 2019-20 – 264; F.Y. 2021-22 – 280; F.Y. 2023-24 – 301
Assume Mr. Nimish is not willing to opt for the provisions of section 115BAC. (6 Marks)
SECTION B: INDIRECT TAXES
Part I MCQ (15 Marks)
Write the most appropriate answer to each of the following multiple-choice questions by
choosing one of the four options given.
Case scenario
Daanpatra Charitable Trust is registered under section 12AA of the Income-tax Act, 1961.
The trust conducted a three day residential yoga camp among people on the occasion of
International yoga day for the advancement of yoga and charged ₹ 7,500 per person inclusive
of stay and food.
The trust also conducted programmes for the advancement of education of persons aged
above 65 years in metro cities. A nominal fee was charged for the same.
The trust received following donations during the month of September: -
(i). Solid Steels Pvt. Ltd. donated a RO water plant to the trust costing ₹ 75,000 and
displayed its company name in the RO system installed at the premises of the trust as
“Donated by Solid Steels Private Limited-trusted by all’.
(ii). Mr. Prasanna, a lawyer donated chai₹ to the trust costing ₹ 25,000 and ‘Love all’ is
printed on all chai₹ donated by him to the trust.
The following are the details of GST payment made by the firm-
i. GST of ₹ 1,75,000 was paid for the purchase of motor vehicle for transportation of needy
persons (Seating capacity including driver is 13).

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ii. GST of ₹ 2,45,000 was paid for works contract services availed from Super Builders for
construction of Trust’s office building.
Daanpatra Charitable Trust also owns and manages a gurudwara. It rented the community hall
located in the precincts of the gurudwara for a rent of ₹ 8,500 per day for a marriage function.
It also rented the commercial shop located in the precincts of the gurudwara for a rent of ₹
10,000 per month per shop.
You can assume that the Trust is registered under GST and all the transactions are intra - State
only. Conditions for availing ITC are fulfilled subject to the above- mentioned information.
Based on the information given above, choose the most appropriate answer for the following
questions [1 to 4]-
1. Which of the following activities conducted by trust is exempt from GST?
(a) Advancement of Yoga (b) Advancement of education (c) Both (a) and (b)
(d) Neither of the activities
2. Determine the value of taxable supply in respect of donations received by the Trust?
(a) ₹ 25,000 (b) ₹ 75,000 (c) ₹ 1,00,000 (d) Nil
3. Compute the amount of input tax credit that can be claimed by the Trust?
(a) ₹ 1,75,000 (b) ₹ 2,45,000 (c) ₹ 4,20,000 (d) Nil
4. Which of the following statements is/are correct under GST law in respect of gurudwara
managed by Daanpatra Charitable Trust?
(a) Renting of community hall is taxable while renting of commercial shop is exempt.
(b) Renting of community hall is exempt while renting of commercial shop is taxable.
(c) Both renting of community hall and renting of commercial shop are taxable.
(d) Both renting of community hall and renting of commercial shop are exempt.
5. Ms. Pearl is a classical singer. She wants to organize a classical singing function, so she
booked an auditorium on 10th August for a total amount of ₹ 20,000. She paid ₹ 5,000 as
advance on that day. The classical singing function was organized on 10th October. The
auditorium owner issued invoice to Ms. Pearl on 25th November amounting to ₹ 20,000.
Pearl made balance payment of ₹ 15,000/- on 30th November. Determine the time of supply
in this case.
A. Time of supply is 25th November for ₹ 20,000.
B. Time of supply is 25th November for ₹ 5,000 & 30th November for ₹ 15,000.
C. Time of supply is 10th August for ₹ 5,000 & 10th October for ₹ 15,000.
D. Time of supply is 10th October for ₹ 20,000.
6. A supplier takes deduction of depreciation on the GST component of the cost of capital
goods as per Income-tax Act, 1961. The supplier can-

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A. Avail only 50% of the said tax component as ITC B. Not avail ITC on the said tax
component C. Avail 100% ITC of the said tax component D. Avail only 25% of the said
tax component as ITC
7. ABC Ltd. is a registered pharmaceutical company. The company invented one drug for
instant cure of cancer. They supplied free samples of this medicine to various docto₹. What
will be the tax treatment of these free samples under GST?
A. ABC Ltd. is liable to pay tax on supply of free samples and eligible to claim input tax
credit.
B. ABC Ltd. is not liable to pay tax on supply of free samples but eligible to claim input tax
credit.
C. ABC Ltd. is neither liable to pay tax on supply of free samples nor eligible to claim input
tax credit.
D. ABC Ltd. is liable to pay tax on supply of free samples but not eligible to claim input tax
credit.
8. Kala Niketan School is an educational institution providing pre-school education an
deduction up to higher secondary school. Which of the following services are exempt if
provided to Kala Niketan School?
(i) Transportation of students, faculty and staff
(ii) Catering services
(iii) Cleaning services performed in such educational institution
A. (i) B. (i) and (iii) C. (ii) and (iii) D. (i), (ii) and (iii)
9. Which of the following service is not exempt under GST?
A. Loading and unloading of paddy B. Loading and unloading of sugarcane
C. Loading and unloading of tea bags D. Loading and unloading of potato
10. Rajnandani Ltd. filed its return of income on 7th December 2020 declaring a loss of ₹
3,50,000. Later, it noticed a claim of expenditure omitted in the return filed. The revised
return
A. Must be filed before 31st March 2022 B. Cannot be filed C. Must be filed before 31st
March 2021 D. Can be filed before completion of the assessment
11. During the month of May, Ziyami Ltd. sold goods to Yatri Ltd. for ₹ 2,55,000 and
charged GST @ 18%. However, owing to some defect in the goods, Yatri Ltd. returned the
goods by issuing debit note of ₹ 40,000 in the same month. Ziyami Ltd. records the return of
goods by issuing a credit note of ₹ 40,000 plus GST in the same month. In this situation,
GST liability of Ziyami Ltd. for the month of May will be-
A. ₹ 45,900 B. ₹ 38,700 C. ₹ 53,100 D. ₹ 40,000
12. Mr. Mahaveer of Himachal Pradesh starts a new business and makes following supplies in
the first month-

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(i) Intra-State supply of taxable goods amounting to ₹ 17 lakh
(ii) Supply of exempted goods amounting to ₹ 1 lakh
(iii) Inter-State supply of taxable goods amounting to ₹ 1 lakh
Whether he is required to obtain registration?
A. Mr. Mahaveer is liable to obtain registration as the threshold limit of ₹ 10 lakh is crossed.
B. Mr. Mahaveer is not liable to obtain registration as he makes exempted supplies.
C. Mr. Mahaveer is liable to obtain registration as he makes the inter-State supply of goods.
D. Mr. Mahaveer is not liable to obtain registration as the threshold limit of ₹ 20 lakh is not
crossed
13. Manjushree, a resident of Delhi, is having a residential property in Vasant Vihar, Delhi
which has been given on rent to a family for ₹ 50 lakh per annum. Determine whether
Manjushree is liable to pay GST on such rent.
A. Yes, as services by way of renting is taxable supply under GST.
B. No, service by way of renting of residential property is exempt.
C. No, service by way of renting of residential property does not constitute supply.
D. Manushree, being individual, is not liable to pay GST
14. Which is not considered as supply under GST Law?
A. Stock transferred from one establishment in Delhi to another establishment in Gurgaon,
Haryana registered under same PAN.
B. CA Ram supplies accounting services to CA Akshita in lieu of taxation services received
from CA Akshita.
C. A Health club supplies lunch to its members at its annual meeting against a nominal charge.
D. Mr. A sells a flat to Mr. B
(i) Date of completion certificate - 31/01/2024
(ii) Date of agreement with buyer - 01/02/2024
(iii) Consideration) received - 05/02/2024
15. Kid zee Ltd., a wholesaler of toys registered in Chandigarh, is renowned in the local
market for the varieties of toys and their reasonable prices. Kid zee Ltd. makes supply of 100
pieces of baby’s learning laptops and chat learning phones to Nancy General Store on 25th
September, 20XX by issuing a tax invoice amounting to ₹ 1,00,000.
However, the said toys were returned by Nancy General Store on 30th September, 20XX.
Which document Kidzee Ltd. is required to issue in such a case?
A. Debit Note B. Refund voucher C. Credit note D. Payment voucher

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 DESCRIPTIVE QUESTION (35 Marks)
Question No.1 is compulsory
Answer any two questions from the remaining Three questions

Q1A. The temple of ancestral deity of Mr. Aman goel and his family is located at Beri,
Haryana. The temple is run by a charitable organisation registered under section 12AA of the
Income Tax Act, 1961. The family has got unshakeable faith in their ancestral deity. Mr.
Aman is a big entrepreneur having flourishing business of tiles in Guru gram. Upon the birth
of their first child, he donated ₹10 lakh to the said temple for construction of a sitting hall in
the temple. On the main door of the sitting hall, a name plate was placed stating “Donated by
Mr. Aman Goel upon birth of his first child”. You are required to examine the liveability of
GST on the donation received from Mr. Aman Goel?
(4 Marks) Or
1A. If a return has been filed, how can it be revised if some changes are required to be made?
1B. Who can be registered as goods and services tax practitioners under section 48 of the
CGST Act (4 Marks)
1C. Decide which person is liable to pay GST in the following independent cases, where the
recipient is located in the taxable territory. Ignore the Aggregate Turnover and Exemption
available.
(i) Miss Shinu Ambani provided sponsorship services to Indian Love Cricket Academy, a
Limited Liability Partnership.
(ii) “Fast move”, a Goods Transport Agency, transported goods of Amba & Co., a partnership
firm which is not registered under GST. (3 Marks)
1D. M/s Yuvaan Associates, a partnership firm, provided recovery agent services to Nitesh
Credits Ltd., a non-banking financial company and a registered supplier, on 15th January.
Invoice for the same was issued on 7th February and the payment was made on 18th April by
Nitesh Credits Ltd. Bank account of the company was debited on 20th April. Determine the
following:
(i) Person liable to pay GST
(ii) Time of supply of service (3Marks)

Q2A. (1) An order is placed to T & Co. Sholapur on 18th August, 2022 for supply of fabrics
to make garments. Company delivered the fabrics on 4th September, 2022 and after
completion of the order issued the invoice on 15th September, 2022. The payment against the
same was received on 30th September, 2022. Determine the time of supply for the purpose of
payment under CGST Act, 2017 with your explanations.
(2) HM Industries Ltd. engaged the services of a transporter for road transport of a
consignment on 20th May, 2022. However, the consignment could not be sent immediately on
account of a strike in the factory, and instead was sent on 20th July 2022. Invoice was
received from the transporter on 20th June 2022 and payment was made on 25th August 2022.
What is the time of supply of the transporter’s service?

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(3) PQR Ltd., have filed their GSTR-3B return for the month of August, 2024 within the due
date i.e. 20.09.2021. It was noticed in October, 2021 that tax dues for the month of August,
2021 have been short paid by ₹ 10,000. The shortfall of ₹ 10,000 was paid through cash
ledger and credit ledger amounting to ₹ 7,500 and ₹ 2,500 respectively while filing GSTR-
3B of October, 2020 which was filed on 20.11.2021.
(i) Examine and compute the interest payable if any under the CGST Act, 2017.
(ii) What would be your answer if, GSTR-3B for the month of August 2023 had been filed
belatedly on 20.11.2024 as above.
Note: Ignore the effect of the leap year. Electronic cash ledger and credit ledger carried
sufficient balance for the above shortfall. (7Marks)
2B. Billori Enterprises started its business activities in the month of January, in the State of
Karnataka. It provides the following information
Sr.NO Particulars Amount(₹)
1 Value of intra-State outward taxable supply of goods 7,00,000
2 Value of inter-State outward taxable supply of 6,00,000
services
3 Value of intra-State outward supply on which tax is 1,00,000
payable under reverse charge mechanism
4 Value of intra-State outward supply of exempted 5,00,000
good from its other place of business in the State of
Manipur (under same PAN

From the information given above, you are required to calculate the aggregate turnover of B
Enterprises with necessary explanations and also, specify with reason whether it is liable to
get registered under CGST Act or not. (4 Marks)
2(C) Soni & Co., a manufacturer and supplier of plastic goods, is registered under GST in the
State of Maharashtra. Soni & Co. sold plastic goods to a retail seller in Punjab, at a value of
₹ 43,000 (excluding GST leviable @ 18%). Now, it wants to send the consignment of such
plastic goods to the retail seller in Punjab. You are required to examine whether e-way bill is
mandatorily required to be generated in respect of such movement of goods as per the
provisions of the GST law. (3 Marks)
Q3A. X Ltd., a registered supplier located in Mumbai, is a manufacturer of heavy machines.
Its outward supplies (exclusive of GST) for the month of January 2024 are as follows –
₹
Inter-State 85,00,000
Intra-State 15,00,000

Applicable rate of CGST, SGST and IGST on outward supply is 9 per cent, 9 per cent and 18
per cent respectively. GST paid on inward supplies during the month of January 2024 is as
follows.

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 CGST ₹ SGST ₹

Raw materials A (of which 70 per cent of inputs procured 60,000 60,000
are used and 30 per cent are in stock at the end of the
January 2023
Raw materials B (of which 90 per cent material received in 50,000 50,000
factory and remaining material completely damaged due to
a road accident on the way to factory, no negligence on the
part of the X Ltd.)
Construction of pipelines laid outside the factory premises 30,000 30,000
Insurance charges paid for trucks used for transportation of 55,000 55,000
goods
Additional information -
- There is no opening balance of any input tax credit and all the conditions necessary for
availing the input tax credit have been fulfilled.
- Details of GST paid on inward supplies are available in Form GSTR-2A except for raw
material A, for which supplier has not filed its Form GSTR-1 for the month of January 2024,
hence corresponding input tax credit is not reflecting in Form GSTR-2A of X Ltd. in January
2024.
Compute the following -
- Amount of eligible input tax credit available for the month of January 2024.
- Net minimum GST payable in cash, for the month of January 2023 after using available
input tax credit. (5
Marks)
3B. Mr. Nikunj, a supplier of goods, pays GST under regular scheme. He is not eligible for
any threshold exemption. He has made the following outward taxable supplies in the month
of August: - ₹
Intra State supplies of goods 6,00,000
Inter State supplies of goods 2,00,000
He has also furnished following information in respect of purchases made by him
from registered dealers during August: -
Intra State purchase of goods 4,00,000
Inter State purchase of goods 50,000
Balance of ITC available at the beginning of the August: -
₹
CGST 15,000
SGST 35,000
IGST 20,000

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Note:
(i) Rate of CGST, SGST and IGST to be 9%, 9% and 18% respectively, on both inward and
outward supplies.
(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. Compute the
minimum GST payable by Mr. Nikunj in cash for the month of August. (4 marks)
Or
3B. Narayan Singh is required to issue a receipt voucher at the time of receipt of advance
payment with respect to services to be supplied to Shelly. A receipt voucher is a document
evidencing receipt of advance money towards a supply of goods and/or services or both. A
registered person, on receipt of advance payment with respect to any supply of goods or
services or both, shall issue a receipt voucher or any other document, evidencing receipt of
such payment.
Where, on receipt of advance payment with respect to any supply of goods or services or both
the registered person issues a receipt voucher, but subsequently no supply is made and no tax
invoice is issued in pursuance thereof, the said registered person may issue to the person who
had made the payment, a refund voucher against such payment. Therefore, in case
subsequently no services are supplied by Narayan Singh, and no tax invoice is issued in
pursuance thereof, Narayan Singh may issue a refund voucher against such payment to Shelly
(4 Marks)
3C. Ram & Shayam Ltd., a registered person, is engaged in the business of spices. It provides
following details in relation to GST paid on inward supplies procured by it during the month
of October.
S. No. Particulars GST (₹)
1 Raw spices purchase
- Raw spices sold to customers 50,000
- Raw spices used for personal use of directors 20,000
2 Electric machinery purchased for being used in 25,000
the
manufacturing process
3 Motor vehicle used for transportation of the 55,000
employee
4 Payment made to contractor for construction of 1,25,000
staff quarter
Determine the amount of ITC that can be availed by Ram & Shayam Ltd. for the month of
October by giving the necessary explanation for treatment of various items. Subject to the
information given above, all the other conditions necessary for availing ITC have been
fulfilled. (5 Marks)
Q4A. (a) GST is a simplified tax structure. Justify the statement.
(b) Brief explain when is it not mandatory to furnish the details of conveyance in Part-B of
the e-way bill? (5 Marks)

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4B. If a return has been filed, how can it be revised if some changes are required to be made?
(4 Marks)
4C. Gagan Engineering Pvt. Ltd., registered in Haryana, is engaged in providing maintenance
and repair services for heavy steel machinery. For carrying out the repair work, Gagan
Engineering Pvt. Ltd. sends its container trucks equipped with items like repair equipment’s,
consumables, tools, parts etc. from Haryana workshop to its own repairing centres (registered
under GST law) located in other States across India where the clients’ machinery are being
brought and are being repaired.
Discuss the leviability of GST on the inter-State movement of trucks from the workshop of
Gagan Engineering Pvt. Ltd. in Haryana to its own repairing centres located in other States
across India. (5 Marks)

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