SEMESTSER-V

B.Com (Hons.)

Discipline Specific Core Course- 5.1(DSC-5.1): Income Tax Law and

Practice

CREDIT DISTRIBUTION, ELIGIBILITY AND PRE-REQUISITES OF THE COURSE

Course Credi Credit distribution of the Eligibi lity Pre-

title ts course criteria requisite
& of the
Code Lectu Tutori Practical/ course
re al Practice (if any)

DSC -5.1: 4 0 Pass in Class NIL

3 1
Income
XII with
Tax Law
and Mathematics/A
Practice ccountancy

Learning Objectives

The course aims to impart knowledge of law pertaining to levy of income tax in India.

Learning outcomes

After completion of the course, learners will be able to:

1. Analyse the basic concepts of income tax and determine the residential status of
different persons.
2. Compute income under the heads ‘salaries’ and ‘income from house property’.
3. Compute income under the heads ‘profits and gains of business or profession’ and
‘capital gains’.
4. Compute income under the head ‘income from other sources’ and understand the
provisions relating to clubbing of income and set-off losses.
5. Analyse various deductions and computation of total income and tax liability of
individuals.

SYLLABUS OF DSC-5.1

Unit 1: Introduction (9 hours)

Basic concepts: Income; Agricultural income, Person, Assessee, Assessment year, Previous
year, Gross Total Income, Total income, Maximum marginal rate of tax and Permanent

36
Account Number (PAN); Residential status: Scope of total income on the basis of residential
status; Exempted incomes under section 10; Learning lessons from Kautilya’s Taxation Policy.

Unit 2: Computation of Income from Salaries and House Property (11 hours)

Income from Salaries; Income from House Property.

Unit 3: Computation of Income from Business or Profession and Capital Gains (11 hours)

Profits and gains of business or profession; Capital gains.

Unit 4: Income from Other Sources, Clubbing of Income and Set-off (7 hours)

Income from other sources; Income of other persons included in assessee’s total income;
Aggregation of income and set-off and carry forward of losses.

Unit 5: Deductions and Computation of Total Income and Tax Liability (7 hours)

Deductions from gross total income; Rebates and reliefs; Computation of total income and tax
liability of individuals (On-line filing of Returns of Income & TDS).

Practical Exercises:

The learners are required to:

1. Prepare a case study for a person resident but not ordinarily resident in India having income
under the head other sources of income.

2. Prepare a presentation indicating the impact of alternative tax regime structure on the tax
liability of an assessee.

3. Present a hypothetical case wherein the impact of change in the capital gains taxes are
reflected as per the relevant Financial Act.

4. Learn about various tax services available on the official website of Government of India.

5. Prepare a list of tax deductions available in case of a senior citizen.

6. Explore and attempt on-line filing of Returns of Income & TDS on Income tax e-filing
website under ITR-1 and ITR-2.

Suggested Readings:
● Ahuja, G., & Gupta, R. (2022). Simplified Approach to Income Tax. Delhi, India: Flair
Publications Pvt. Ltd.

● Bandypoadhyay, S. B., & Das, C. (2019). TAXATION II (1st ed., Vol. II). Delhi, India:
Oxford University Press.

● Mittal, N. (2019). Concept Building Approach to Income Tax Law and Practice (1st ed.,

37
 Vol. 1). Delhi, India: Cengage Learning India Pvt.

● Singhania, V. K., & Singhania, M. (2021). Students' Guide to Income Tax | University
Edition. Delhi, India: Taxmann Publications Private Limited.

Additional Readings:
● Current Tax Reporter. Jodhpur, India: Current Tax Reporter.
● Income Tax Reports. Chennai, India: Company Law Institute of India Pvt. Ltd.

Note: Suggested readings will be updated by the Department of Commerce and

uploaded on the Department's website.

Discipline Specific Core Course- 5.2 (DSC-5.2): Business Economics

Course Credi Credit distribution of the Eligibi Pre-

title ts course lity requisite
& criteri of the
Code Lectu Tutori Practical/ a course
(if any)
re al Practice

DSC-5.2: Pass in
4 3 1 0 NIL
Business Class XII
Economics with
Mathemati
cs/Account
ancy
Learning Objectives
The course aims to acquaint the learners with Micro economics and its applications.
Learning outcomes
After the completion of the course, the learners will be able to:
1. Examine the nature and scope of business economics.
2. Analyse how consumers try to maximize their satisfaction by spending on different goods.
3. Evaluate the relationship between inputs used in production and the resulting outputs and
costs.
4. Analyse and interpret various facets of and pricing under different market situations.
5. Discuss the contemporary issues and applications in micro economics.

SYLLABUS OF DSC-5.2

Unit 1: Introduction to Business Economics (5 hours)

38
 Guidelines for the Paper Titled “Income Tax Law and Practice"
of B.Com.(Hons.) Paper No. DSC 5.1, Semester-V
JOINTLY ORGANISED
By
Department of Commerce, Delhi School of Economics, University of Delhi
And
Department of Commerce, Shaheed Bhagat Singh College, University of Delhi
Date: 30th September 2024

MINUTES OF THE MEETING

An online meeting of the paper Titled “Income Tax Law and Practice" of B. Com. (Hons.)
Semester-V, Paper No. DSC 5.1, was jointly organized by the Department of Commerce,
Delhi School of Economics, University of Delhi and the Department of Commerce, Shaheed
Bhagat Singh College, University of Delhi. The meeting was held through Google Meet
Platform (Meeting ID: https://meet.google.com/szf-ghmh-ryb) on 30th September 2024 at
11.00 AM. Following faculty members of the different colleges of University of Delhi
associated with the teaching of this paper were present in the meeting:

S.No Name of the Faculty Department/ Affiliated College

Department of Commerce, Delhi School of
1 Dr. Pooja Goel, Representative Economics
Teacher-In-Charge, Department of Commerce,
2 Prof. Shikha Gupta 1, Convener Shaheed Bhagat Singh College
3 Dr.Shalini Gupta Shaheed Bhagat Singh College
4 Dr.Vandana Dahiya Shaheed Bhagat Singh College
5 Mr.Aashish Jain Sri Venkateswara College
6 Dr.Abha Wadhwa Deen Dayal Upadhyaya
7 Ms.Aiman Satyawati college
8 Dr.Aishwarya Nagpal Kirori Mal College
9 Dr.Amrita Kaur Shaheed Bhagat Singh College
10 Mr.Ankush Kumar Jindal College of Vocational Studies
11 Dr.Anuradha Tyagi Dr. Bhim Rao Ambedkar College
12 Ms.Bhupinder Kaur Aneja Sri Guru Gobind Singh College of Commerce
13 Dr.Chandan Karki Motilal Nehru College (Day)
14 Mr.Deepak Verma Deshbandhu College
15 Ms.Deepshikha Yadav Hansraj College

1
16 Dr.Diksha Shyam Lal College
17 Mr.Dilip Kumar Gupta Atma Ram Sanatan Dharma College
18 Ms.Divya Gupta Hindu College
19 Dr.Dr Raghuveer Singh Rajpurohit Keshav Mahavidyalaya
20 Mr.Gaurav Sharma Rajdhani College University of Delhi
21 Mr.Gopal Arora SGND Khalsa College
22 Mr.Gulshan Kumar DDUC
23 Dr.Gurcharan Sachdeva PGDAV College
24 Dr.Gurminder Kaur Arora Sri Guru Gobind Singh College of Commerce
25 Ms.Harmanpreet Kaur Shivaji College
26 Ms.Hersheen Kaur Sri Guru Gobind Singh College of Commerce
27 Dr.Indu Aditi Mahavidyalaya
28 Mr.Jitender Chawla Dyal Singh College
29 Ms.Kalyani Rajan A.R.S.D College
30 Prof. Kamal Mohan Bansal Dr. Bhim Rao Ambedkar College
31 Mr.Krishan Kant Shri Ram College of Commerce
32 Ms.Kritika Khurana Maitreyi college
33 Mr.Kundan Kumar Rajdhani College
34 Dr.Laxman Ram Paliwal Swami Shraddhanand college
35 Mr.Mahesh Kumar Motilal Nehru College
36 Dr.Manish Kumar Shyam Lal College
37 Ms.Manisha Shivaji College
38 Dr.Manpreet Kaur Mata Sundri College for Women
39 Ms.Maya Rani Moti Lal Nehru College (Eve)
40 Dr.Meenakshi Yadav PGDAV college (Eve)
41 Dr.Meera Nangia College of Vocational Studies
42 Dr.Meetakshi Pant Shaheed Bhagat Singh College
43 Dr.Mohd. Tariq Azizy Keshav Mahavidyalaya
44 Dr.Mohit Kumar Shaheed Bhagat Singh College
45 Dr.Neera Pal Ram Lal Anand College
46 Prof. Neeta Bareja Lakshmi Bai College
47 Dr.Neha Kashyap Lakshmi Bai College
48 Dr.Neha Singhal Sri Venkateswara College
49 Ms.Neyati Ahuja Shaheed Bhagat Singh College

2
50 Dr.Nirmal Jain Maharaja Agrasen College
51 Dr.Nishi Sharma Dr. Bhim Rao Ambedkar College
52 Ms.Parvinder Kaur Mata Sundri College for Women
53 Mr.Pawan Kumar Kalindi College
54 Ms.Pinkey Pandey Sri Aurobindo College (Eve)
55 Ms.Pooja Rani Ramjas College
56 Ms.Priya Aggarwal Lady Shri Ram College for Women
57 Dr.Priya Harjai Swami Shraddhanand College
58 Dr.Promila Bhardwaj Dyal Singh College (Eve)
59 Ms.Purnima Meena Lakshmibai College
60 Dr.Raghvendra Bochaliya Atma Ram Sanatan Dharma College
61 Mr.Raj Kumar Aggarwal Shaheed Bhagat Singh College
62 Dr.Rajender Singh Ram Lal Anand College
63 Dr.Rashi Paliwal Aditi Mahavidyalaya
64 Ms.Rasleen Kaur Sri Guru Gobind Singh College of Commerce
65 Dr.Renu Aggarwal Deen Dayal Upadhyaya College
66 Dr.Ritu Rani Daulat Ram College
67 Dr.Ritu Dagar Daulat Ram College
68 Mr.Riyaz Ali Swami Shraddhanand College
69 Dr.Ruchi Goyal Keshav Mahavidyalaya
70 Dr.Saba Abid Indraprastha College for Women
71 Ms.Sakshi Meena Vivekananda College
72 Ms.Saloni Arora Jesus and Mary College
73 Dr.Sameer Lama Kirori Mal College
74 Dr.Sandeep Sehrawat Satyawati College (Eve)
75 Dr.Sangeeta Arora Hindu College
76 Dr.Saumya Sharma Vivekanand College
77 Dr.Shaista Sami Rajdhani College
78 Dr.Shalini Aggarwal Dyal Singh College
79 Dr.Shamsher Singh PGDAV College (M)
80 Dr.Shasta Gupta Sri Aurobindo College
81 Dr.Shikha Gupta Kamala Nehru College
82 Dr.Shilpi Sahi Bharati College
83 Ms.Shivani Kalra Vivekananda College

3
84 Dr.Shoeba Zakir Husain Delhi College (Day)
85 Dr.Shweta kalra Satyawati College
86 Ms.Simarpreet Kaur Sri Guru Nanak Dev Khalsa College
87 Dr.Sonal Babbar Maitreyi College
88 Dr.Sonal Jain Janki Devi Memorial College
89 Ms.Soumya Sharma Vivekananda College
90 Mr.Sumit Kumar Ramanujan College
91 Dr.Sunil Kumar Deen Dayal Upadhyaya College
92 Ms.Sushma Aggarwal Vivekananda College
93 Ms.T. Jeya Christy Indraprastha College for Women
94 Ms.Timsy Gupta Sri Guru Nanak Dev Khalsa College
95 Dr.Tonika Rana Daulat Ram College
96 Ms.Trishala Chauhan Kamala Nehru College
97 Mr.Tusher Kanti Debbarma Dyal Singh College
98 Dr.Vandana Bansal Bharati College
99 Dr.Yask Sain Acharya Narender Dev College

The following guidelines were set in the meeting with the consent of the teachers present in
the meeting and the Representative of the Department of Commerce, Delhi School of
Economics, University of Delhi, in order to have uniformity and consistency in teaching
thereby facilitating the teaching-learning process.

Unit 1: Introduction
Basic concepts: Income, agricultural income, person, assessee, assessment year, previous
year, gross total income, total income, maximum marginal rate of tax, Permanent Account
Number (PAN); Residential status; Scope of total income on the basis of residential status,
Exempted income under section 10, Learning lessons from Kautilya’s Taxation Policy.

Guidelines
 Agricultural income: Only concept & simple integration need to be covered. Cases of
rubber, tea, and coffee need not be covered.
 Residential Status: Sec 9(1)(viii) need to be emphasized.
 Exempted income: The following exempted incomes need to be covered- Section 10(1),
10(2), 10(5), 10(7), 10(10), 10(10A), 10(10AA), 10(10D), 10(11), 10(12), 10(11A),
10(12C), 10(13), 10(13A), 10(14)*, 10(15), 10(16), 10(32)(Important), 10(36), 10(37).
 All six allowances under section 10(14)(i) need to be covered. Only education, hostel, and
transport allowance need to be covered in special allowances under section 10(14)(ii).
 Kautilya’s Taxation Policy- A brief outline of Kautilya’s taxation policy.

4
Unit 2: Computation of Income from Salaries and House Property

Income from Salaries; Income from house property.

Guidelines
 ESOP- only concept need to be covered. Valuation of ESOP need not to be covered.
 Rent Free Accommodation (RFA): Hotel accommodation & 2 accommodations at the
same time need not to be covered.
 Transport allowance for transport employees need not be covered. Tribal area, hill area,
insurgency area allowance need not to be covered.
 Voluntary Retirement Scheme [Section 10(10C)] and Retrenchment Compensation need
not be covered.
 Sweat equity shares only concept, valuation need not be emphasized.

Unit 3: Computation of Income from Business or Profession and Capital Gains

Profits and gains of business or profession; Capital gains.

Guidelines

A. Computation of Income from ‘Profits and Gains from Business or Profession’

 Only sections 28, 29, 30, 31, 32*, 35 (Expenditure on scientific research only), 35D,
36, 37, 40, 40(a)**, 40A***, 41, 43B need to be emphasized.
- Sec 32*- Depreciation in case of Power units, Depreciation in case of
amalgamation and business re-organization and Section 32AD not to be covered.
- Sec 40(a)**- Provisions to be covered - Interest, royalty for technical services
paid outside India or to a non-resident [40(a)(i)], amount payable to a resident
[40(a)(ia)], salary payable outside India without tax deduction [40(a)(iii)], tax on
non-monetary perquisite paid by employer [40(a)(v)].
- Sec 40A***- Provisions to be covered - Payment to relative [40A(2)],
Expenditure exceeding 10,000 [40A(3)], Provision for unapproved Gratuity Fund
[40A(7)], Contributions to non- statutory funds [40A(9)] .
 Section 35 AD-Provisions related to specific industries e.g. cold storage, banking etc.
not to be covered.
 Sections 44AA, 44AB, 44AD, 44ADA, 44AE need to be covered conceptually.

B. Computation of Income from ‘Capital Gains’

 Under Capital Gains in Special Cases following need not be covered
- Transfer of capital asset by a partner to a firm and by a firm to its partner.
- Capital Gains on Transfer of shares/ debentures in the hands of a Non-Resident.
- Capital Gains arising on Transfer of Sweat Equity Shares or ESOP shares.
- Capital Gains on Buy back of Shares [Sec 10(34A), 46A and 115 QA].
- Capital Gains in case of Joint Development Agreement [Sec 45(5A) and 49(7)].
- Capital Gains in the case of transfer of unlisted shares in a company [Sec 50CA].
- Slump Sale [Sec 50B]
- Tax incentive for the development of capital of Andhra Pradesh [Sec 10(37A) and
49].
 Section 50C should be covered.

5
  Under Capital Gains Exempt from tax
- Section 54, 54B, 54EC and 54F need to be covered.
- Only simple questions on Section 54F.
 Capital gains provisions related to individuals need to be covered.

Unit 4: Income from Other Sources, Clubbing of Income and Set-off

Income from other sources; Income of other persons included in assessee‘s total income;
Aggregation of income and set-off and carry forward of losses.

Guidelines
Income from Other Sources
 Section 56 (2)(viia), 56 (2)(viib), 56(2)(viii) and Section 56(2)(xii) need not be covered.
Clubbing of Income
 Section 60 to section 64(1) to be covered in theory only.
 Section 64(2) need not be covered.
Set-off and carry forward of losses
 Sections to be covered- Section 70, 71, 72,73, 74.
 Sections need not be done- Section 72A, 73A, 74A, 79, 94(8).

Unit 5: Deductions and Computation of Total Income and Tax Liability

Deductions from gross total income; Rebates and reliefs. Computation of total income and
tax liability of individuals (On-line filing of Returns of Income & TDS).

Guidelines

 Following deductions need to be emphasized for practical purpose- Section 80A, 80AB,
80AC, 80C, 80CCC, 80CCD, 80CCH, 80D, 80DD, 80DDB, 80E, 80G, 80GG, 80GGA,
80GGC, 80 TTA, 80TTB, and 80U.

 Rebates should be covered. Reliefs may not be covered.

 Only ITR-2 should be done using excel utility available on the official website of the
Government of India (www.incometax.gov.in) for practical examination.

 Students to be made familiar with income tax e-filing website, tax services available, tax
calculator and filing of return (no specific question on TDS).

Additional Notes
 The question paper should have a wide coverage from all the sections.
 The question paper should mention the New/Old tax regime for solving the question.
 With respect to practical examination, a student is supposed to know both New/Old
regime in excel utility (ITR-2).

All the faculty members participated actively in the deliberations and appreciated the timely

6
initiative of Sr. Prof. Ajay Kumar Singh, Dean & Head, Department of Commerce and
expressed sincere thanks to Prof. Amit Kumar Singh, Coordinator, Department of Commerce,
University of Delhi for the interest shown by him in executing this meeting. Sincere gratitude
to Dr. Pooja Goel, Associate Professor and Representative, Department of Commerce,
University of Delhi for her inputs throughout the deliberations in the meeting.

The meeting ended with a special vote of thanks to Prof. Shikha Gupta 1, Convener and
Teacher-in- Charge, Department of Commerce, Shaheed Bhagat Singh College, for taking the
initiative in convening, facilitating and providing valuable inputs in the meeting and Dr.
Pooja Goel, Representative, Department of Commerce, Delhi school of Economics,
University of Delhi.

Dr. Pooja Goel Prof. Shikha Gupta

Representative Convenor & TIC
Department of Commerce Department of Commerce
Delhi School of Economics Shaheed Bhagat Singh College
University of Delhi University of Delhi

7
Guidelines for the Paper Titled “Income Tax Law and Practice"
of B.Com.(Hons.) Paper No. BCH 3.2, Semester-III (CBCS)
JOINTLY ORGANISED
BY
Department of Commerce, Delhi School of Economics, University of Delhi
And
Department of Commerce, Shaheed Bhagat Singh College, University of Delhi
Date: 19th September 2020
MINUTES of the Meeting
An online meeting of the paper Titled “Income Tax Law and Practice" of B. Com.(Hons.)
Semester-III, Paper No. BCH 3.2, was jointly organized by Department of Commerce, Delhi
School of Economics, University of Delhi and Department of Commerce, Shaheed Bhagat
Singh College, University of Delhi. The meeting was held through Google Meet Platform
(Meeting ID: https://meet.google.com/tsb-jbjy-mdn) on 19th September 2020 at 11.00 AM.
Following teachers were present in the meeting:
S. NO. Name of the Faculty Department/ Affiliated College
Teacher-In-Charge, Department of
1 Dr. Anil Kumar, Convener Commerce, Shaheed Bhagat Singh
College, University of Delhi
Department of Commerce, Delhi School
2 Dr. Shital Jhunjhunwala
of Economics, University of Delhi
3 Mr. Mohd. Rehan Alam ARSD College
4 Dr. Shilpi Narula Bharati College
5 Dr. Meera Nangia College of Vocational Studies
6 Dr. Minakshi Paliwal Daulat Ram College
7 Ms. Raman Arora Daulat Ram College
8 Dr. Sunil kumar Deen Dayal Upadhyaya College
9 Mr. Sanjeev Kumar Dr. Bhim Rao Ambedkar College
10 Mr. Arun Kumar Dyal Singh College
11 Ms. HANSIKA KHURANA Gargi College
12 Ms. Anjali Tuli Hansraj College
13 Ms. Deepshikha Yadav Hansraj College
14 Ms. Sangeeta Arora Hindu College
15 Mr. Pawan Kumar Indraprastha College for Women
16 Ms. Sushma Kumar Indraprastha college for Women
17 Ms. Neelam Jhawar Indraprastha college of women
18 Ms. Shilpa Maggo Janki Devi Memorial College
19 Ms. Shweta Gupta Janki Devi Memorial College
20 Ms. Saloni Arora Jesus and Mary College
21 DR. Renu Gupta Jesus and Mary College
22 Dr. Punam Sachdeva Kalindi College
23 Ms. Shivali Veen Kalindi College
24 Ms. Mahima Yadav Kamla Nehru College
25 DR. Sameer Lama Kirori Mal College
26 Dr. Nirmal Jain Maharaja Agrasen College
27 Ms. Sonam Bhati Maharaja Agrasen College
28 Ms. Parvinder Kaur Mata Sundri college for Women
29 Ms. Manpreet Kaur Mata Sundri college for Women
30 Mr. Nishant Sharma Motilal Nehru College (Evening)
31 Ms. Seema Agarwal PGDAV College
32 Mr. Kundan Kumar Rajdhani College
33 Ms. Charu Jain Ramanujan College
34 Dr. Anshika Agarwal Ramanujan College
35 Dr. Naresh Gupta Ramjas College
36 Ms. Bhamini Garg Satyawati College
37 Ms. Sandhya Taneja Satyawati college
38 Mr. Sandeep Sehrawat Satyawati College Evening
39 DR. Gurminder kaur SGGSCC Pitampura
40 Mr. Gopalkrishan Arora SGND Khalsa College
41 Dr. Amrita Kaur Shaheed Bhagat Singh (E) College
42 Ms. Anvi Jain Shaheed Bhagat Singh College
43 Ms. Chandni Aswal Shaheed Bhagat Singh College
44 Mr. Hashir Mairaj Shaheed Bhagat Singh College
 45 DR. Nisha Gupta Shaheed Bhagat Singh college
46 Ms. Preeti Choudhary Shaheed bhagat singh college
47 Ms. Ankita Kashyap Shaheed Bhagat Singh College
48 Ms. Mansi Babbar Shaheed Bhagat Singh College
49 Ms. Neyati Ahuja Shaheed Bhagat Singh College
50 Mr. Rajkumar Aggarwal Shaheed Bhagat Singh College
51 Dr. Shalini Gupta Shaheed Bhagat Singh College
52 Dr. Shikha Gupta1 Shaheed Bhagat Singh College
53 Mr. Vishal Garg Shaheed Bhagat Singh College
54 Dr. Kamaldeep Bajaj Shri Guru Tegh Bahadur Khalsa College
55 Mr. Deepak Kumar Shri Ram College of Commerce
56 Ms. Ruchika Choudhary Shri Ram College of Commerce
57 Ms. Saumya Aggarwal Shri Ram College of Commerce
58 Mr. Mohd Sajid Shyam Lal College
59 Dr. Neha Bothra Shyam Lal College
60 Ms. Meenakshi Thakur Sri Aurobindo College (Eve)
Sri Guru Gobind Singh College of
61 Ms. Bhupinder Kaur
Commerce
62 Mr. Arvinderpalsingh Arora Sri Guru Nanak Dev Khalsa College
63 Ms. Sushma Aggarwal Vivekananda college
64 Mr. Ashok Sharma Zakir Husain Delhi College
65 Ms. Shabana Wiquar Zakir Hussain Delhi College (Evening)
66 Ms. Abha Wadhwa Not mentioned by the teacher
67 Dr. Alka Gupta Not mentioned by the teacher
68 Ms. Kritika Khurana Not mentioned by the teacher
69 Ms. Renu Aggarwal Not mentioned by the teacher
70 Mr. Bunny Bhatia Not mentioned by the teacher
71 Dr. Gurmeet Singh Not mentioned by the teacher
72 Ms. Madhu Jain Not mentioned by the teacher

The following guidelines were set in the online meeting with the consent of the teachers
present in the meeting and the Representative of the Department of Commerce, Delhi
School of Economics, University of Delhi; in order to have uniformity and consistency
thereby facilitating the teaching-learning process.

Unit I: Introduction

Basic concepts: Income, agricultural income, person, assessee, assessment year, previous
year, gross total income, total income, maximum marginal rate of tax, Permanent Account
Number (PAN); Residential status; Scope of total income on the basis of residential status,
Exempted income under section 10

Guidelines

• Agricultural income: Only concept & simple integration need to be covered. Cases of
rubber, tea, and coffee need to be emphasized conceptually only.
 • Exempted income: The following exempted incomes need to be covered- Section
10(1), 10(2), 10(2A), 10(5), 10(7), 10(10), 10(10A), 109AA), 10(10B), 10(10C),
10(10D), 10(11), 10(12), 10(13), 10(13A), 10(14)*, 10(15), 10(16), 10(32)(Important),
10(34), 10(35), 10(36), 10(37).

*All six allowances under section 10(14)(i) need to be covered. Only education, hostel,
and transport allowance need to be covered in special allowances under section
10(14)(ii).

Unit II: Computation of Income under different heads-1

Income from Salaries, Income from house property

Guidelines

• Salary: ESOP- only concept need to be covered. Valuation of ESOP need not
to be covered.
• Rent Free Accommodation (RFA): Hotel accommodation & 2
accommodations at the same time need not to be covered.
• Transport allowance for transport employees need not be covered. Tribal
area, hill area, insurgency area allowance need not to be covered.
• Voluntary Retirement Scheme[Section 10(10C)] and Retrenchment
Compensation need to be covered conceptually only.

Unit III: Computation of Income under different heads-2

Profits and gains of business or profession; Capital gains; Income from other sources.

A. Income under the head ‘Profits and Gains from Business or Profession’

Guidelines

Only sections 28, 29, 30, 31, 32, 35 (Expenditure on scientific research only), 36, 37, 40,
40(a), 40(b), 40A, 41, 43B, 44AD, 44ADA, 44AE, 44AB, 44AA need to be covered.

• Provisions related to specific industries e.g. cold storage, banking etc. not to
be covered.
• Sec 32- Depreciation in case of Power units, Depreciation in case of
amalgamation and business re-organisation and Section 32AD not to be
covered.
• Sec 40(a)- Provisions to be covered - Interest, royalty for technical services
paid outside India or to a non-resident [40(a)(i)], amount payable to a
resident [40(a)(ia)], salary payable outside India without tax deduction
[40(a)(iii)], tax on non-monetary perquisite paid by employer [40(a)(v)].
 • Sec 40(A)- Provisions to be covered - Payment to relative [40A(2)],
Expenditure exceeding 10,000 [40A(3)], Provision for unapproved Gratuity
Fund [40A(7)], Contributions to non- statutory funds [40A(9)] .

B. Income under the head ‘Capital Gain’

Guidelines

• Under exemption of capital gains Section 54, 54B, 54EC, 54F and 54H need to be
emphasized.
• Only simple questions on Section 54F.
• Section 50C should be covered.
• Capital gains provisions related to Individuals and Firms need to be covered.
• Under Capital Gains Exempt from Tax following need not be covered
— Conversion of Indian Branch of a Foreign bank into Indian Subsidiary [Sec 115 JG
(1)].
— Land Pooling Scheme of Andhra Pradesh Govt. [Sec 10(37A)].
• Under Capital Gains in Special Cases following need not be covered
— Capital Gains arising on Transfer of Sweat Equity Shares or ESOP shares.
— Capital Gains on Buy back of Shares [Sec 10(34A), 46A and 115 QA].
— Capital Gains on Transfer of Shares in the hands of a Non-Resident.
— Capital Gains in case of Joint Development Agreement [Sec 45(5A) and 49(7)].
— Special cases- Section 50B Slump Sale.
C. Income under the head ‘Income from Other Sources’

Guidelines

• Income from other Sources: Section 56(2)7B, 56(2)8, 94(7), 94(8) need not to be
covered.

Unit IV: Computation of Total Income and Tax Liability

Income of other persons included in assessee’s total income; Aggregation of income and
set-off and carry forward of losses; Deductions from gross total income; Rebates and reliefs.
Computation of total income of individuals and firms; Tax liability of an individual and a firm;
Five leading cases decided by Supreme Court.

Guidelines

A. Deductions
 • Deductions from gross total income: Following sections need to be emphasized for
practical purpose- Section 80A, 80AB, 80AC, 80C, 80CCC, 80CCD, 80CCF, 80D, 80DD,
80DDB, 80E, 80G, 80GG, 80GGA, 80GGC, 80TTA, and 80U.
• Deductions under section 80EE, 80EEA, 80EEB, 80TTB should be covered.

B. Clubbing of Income, Set off and carry forward of losses

• Sections to be covered- Section 70, 71, 72,73, 74.

• Sections need not be done- Section 72A, 73A, 74A, 79.

• Sec. 60 to Sec 64(2) related to clubbing of income to be covered in theory only.

C. Rest of Unit IV

• Assessment of AOP and BOI not to be done. AMT not to be done.

• Rebates should be covered. Reliefs may not be covered.
• Cases:
1. Gestetner Duplicators Pvt. Ltd. Vs. CIT (1979) 117 ITR 1 (SC)
2. CIT Vs. Raja Benoy Kumar Sahas Roy (1957) 32 ITR 466 (SC)
3. Shiela Kaushisk Vs. CIT (1981) 131 ITR 435 (SC)
4. Philip John Plasket Thomas Vs. CIT (1963) 49 ITR 97 (SC)
5. CIT Vs. B.C. Srinivasa Setty (SC) (1981)

Unit V: Preparation of Return of Income

Filing of returns; Manually, On-line filing of Returns of Income & TDS; Provision &
Procedures of Compulsory On-Line filing of returns for specified assesses.

Guidelines

• Only ITR-2 should be done using excel utility available on the official website of
the government (www.incometaxindiaefiling.gov.in).

• Practical examination is of 20 marks.

Additional Notes

• The question paper should have a wide coverage from all the sections.
• Theory question from Unit V to be included in the question paper (No specific
question on TDS).

The meeting ended with a vote of thanks to Dr. Shital Jhunjhunwala, Representative,
Department of Commerce, Delhi school of Economics. and Dr. Anil Kumar (Convener),
Teacher in charge, Department of Commerce, Shaheed Bhagat Singh College.