14.

73
rs GAINS
PROFITS& OF BUSINESS/ PROFESSION By: CA Vijender Aggarwal

Deduct
tions/ /ineligible income items
of opening stock (9,000)
L Undervaluation
Tncome from UTI {Exempt u/s 10(35)] (2,400)
.Deprec1ation(See
Note 1) (66,000) (77 400)
Business Income 1,30,900

Calculationo f depreciation:
Niotes

Particulars Amount (Rs)

the block of plant & machinery as on 1.4.2020 4,20,000
WDVof

plant & mach1nery 70,000

Cost of new
Add: sold (50,000)
proceeds of
assets
Sale
Less: 4,40,000
WDV of the block
of plant &machinery on as
313.2021
Depreciation15% 66,000
articie.
is allowable as the assessee is not engaged in manufacture or production of any
additional depreciation is deductible.
No ROI u/s 139(1), the same
Sales-tax liability
has been pard before the due date of filing
Sunce
Since

ESUMPTIVE PROVISIONS: Computation of Business Income u/s 44AD:

PRES
business income would be 8% of turnover, ie Rs 8,96,920 (8% of Rs 1,12,11,500)
Section 44AD, the not exceed
AS per since his turnover does
44AD, taxation u/s
this case, Mr Sivam is eligible to opt for presumptive
Conclusion: In normal provisions of the Act is lower than
the presumptive
in Py 2020-21. But as the business income as per under the normal
Rs 2 crore u/s 44AD, it is advisable for Mr Sivam to offer
his business income
Rs 8,96,920 computed not opt
ncome of u/s 44AB if he does
Since, his turnover exceeds Rs 1 crore,
he has to get his books of accounts audited
provisions. of Section 44AD this year
income u/s 44AD. Further, if he
declares income as per presumptive tax provisions
to declare (ie, from
and he does not opt for presumptive taxation in any
of the five succeeding previous years
ie, PY
2020-21)
will not be available for next five years
PY 2025-26), then the benefit of Section 44AD
Py 2021-22 to

Presumptive Taxation-Section 44AE

Answer 45
shall be Rs 1,42,500 [(Rs 7,500 x 10) (Rs 7,500 x 9)]
The income of the
assessee

Answer 46
2021-22:
Computation of Total Income of Mr Ramamurthy for Ay Amount (Rs)
Particulars

Presumptive business income u/s 44AE:

months)
2 30,000
vehicles for 2 months (2 x Rs 7,500 x
2 light goods Rs 7,500 x 12 moths) 1,80,000
Balance 2 light goods vehicles for 12 months (2 x

10 months (7 x Rs 7,500 x 10 months)

5,25,000
7 light goods vehicles for 7,35,000
Business Income
(50,000)
Less: Brought forward business loss of discontirnued business 6,85,000
Total Income
the presumptive provisions of
for computing the income from goods carriages applying
Nofe: The assessee eligible
is
at any time during the Py.
ection 44AE since he does not own more than 10 goods carriages

Answer 47
he is engaged in the business of plying goods carriages and owrns
Section 44AE would apply in case of Mr Sukhvinder since
hot more than ten goods carriages at any time during the previous year.

Calculation of Presumptive Income as per Section 44AE: Ton

Rate p.m. Amount
No of
Type of Carriage
-OR- (1 Ton (Rs)
Months Rate per ton p.m.1,000 Kgs)

Telearam Channel (https.tme, viende raggaraaitax) For Accessing

Notes
SummaresVjender
Sutscribe CA Aagarwals
Revisionary Vcegs Amendment Notes & Videos Latest Subjective Q4A Latest MCQs etc
 14.74 PROFITs & GANS OF BUSINESS/PROFEssiON By: CA Vijende
Agg
Heavy foeds Vehicle
I
goods carrroge upto 1 May 1,000 15
30,000
1,000 15
9o0ds carriages held threoughout the year 9,00,000
eods Vehicle Othec Than Heary Geeds
1 goods
Vehrcie 11 ,500
carriage from May 82,500
gocds carTioges held throughout the year 12 7.500
3,60,000
Total
13,72,500
However, Mr Sukhvinder may claim lower profits and gains if he keeps and maintains proper books of accotns
Section 44AA and gets the some audited and furnishes a report of such audit as required u/s 44AB unt as per

emevtatien ef Tetal Inceme ef Mr Sukhvinder for AY 2021-22:

Particulars
Presumptive Presumptive
Income Opted (Rs) Tncome Not Opted (Rs)
Income from business of plying goods carriages 13,72,500o
4,45,000
Other business and non-business income 70,000
70,000
Total Encome 14,42,50o
5,15,000
Arswer 48
Cemputation ef TetalIncemeof Mr Xfor Ay 2021-22:
Particulars Amount (Rs)
Presumptive income u/s 44 AE
6,75,000
LRs 7500 x 6 vehicles x 12 months) (Rs 7,500 x 2 vehicles x 9 months)]
Less: Business loss to be adjusted
Less: Unabsorbed Depreciation [Not allowed since covered u/s 32(2)] (1,00,000)
Nil
Gross Total Income
Less: Deduction u/s 8OC (Life insurance premium) (Max 10% of 5,75,000
Less: Deduction u/s 80D (Mediclaim insurance premium)
sum assured) (20,000)
Less: Deduction u/s 80E (Interest on loan taken for daughter's education) (23,000)
Total Income (15,000)
5,17.000
Answer 49
Since Mr X does not own more than 10 vehicles at
any time during PY 2020-21, he is eligible to
scheme u/s 44AE. Rs 1,000 per ton of vehicle
opt for presumptive taxation
gross weight or unladen
weight per month of the month for each heaw
goods vehicle and Rs 7.500 per month or part of month for each or
part
would be deemed as his goods carriage other than heavy goods vehicle, owned by hm

profits and gains from such goods carriage. Heavy goods vehicle means
gross vehicle weight of which exceeds 12,000 kg. any goods carriage, the
Number Date of No of Months for which
of Vehicles Purchase No of Months x No of Vehicles
Vehicle is Owned
ForHeary Goods Vehicle
29.08.2020 8 16
23.02.2021 2 2
TOTAL 18
For Goods Vehicle Other Than Heavy Goods Vehicle:
10.4.2020 12 24
15.3.2021
3 16.7.2020 9 27
2.1 2021 3

Subscribe CA Vijender Aggarwa/'s Telegram Channel (https://t

Summaries, Revisonary Videos Amendment Niotes & Vdecs, me/vijenderogoarwaltax)
For Accessing Notes
Latest Subjective Q$A, Latest MCOs etc
 GAINS OF BUSINESS/PROFESSION CA Vijender
Aggarwa
g O F I T S& G A I

By:

TOTAL for ather

t r

90n heing
of Mr X u/s 44AE for AY 2021 22 woudd tbe R 6 A2 no0((ie 5ae 7
e pOESUTptve
tve
ome

18 x Rs 1000 « 15 tond being for henvy

qeode vehic le )) 2020
onty in July
y g o d ev e h
X
rem
amoin the same even if the two vehic les purc hased in April 2020 were put fo uge
ed by Mr
the vehieie
has fo be
rolc ulated per month or port of the month for which
w O u l d

tive income
MSNer in
tive
preump
he

the
he

Comprehensive Questions
deductian
deds
tion allowed as
a5 is
Alowable

l no provision is allowed as deduc tion However,

, provision
provision payment of gratuity
for payment gra
conditions given below are
fulilled
pth the fund is an approvedgratuity fund, and
grofuty
The has been made on the basis of octuarial valuation.
The
provision

provision has been made on the basis of actuarial

fhe
valuation, the
same shali oe
n the
in present
the present
ocase
a napproved gratuity fund
Since
provided:d such provision is for the purpose of contribution towards
as deduction
cultivator. rower
) A l o w a b l ea sd e d u c t i o n
direct to the
purchase of agricultural produce
case the payment is made for the cash
poyment
for
Cule 6DD, in
AsperRi attracted even ough
ofsuch
: agricultural produce, no disallowance u/s 40A(3) is is not
since cash attracted

disallowance u/s 40A(3)

exceeds Rs 10,000. Therefore, the given case,
in
producer

or

the expe purchase of oil

seeds is made directly to the farmer.
p a y m e n
for
t

is
deduction its empioyees
as provided to
the employer in respect of non-monetary perquisites
allowable
a Net
mefox of Rs 20,000 paid by income-tax paid by
the empioyer
come

As Section 40(a)v), such

the employee u/s 10(10cc). per
the hands of
empt in income.
while compufing business
Pxer

not
deductible
s
Rule 60D.
o)Allwableas deduction covered under
credit card is
insurance is allowable as deduction u/s 36(1). Since payment by
fire this case.
Payment for is not attracted in
the exceptions to Section 40A(3), disallowance u/s 40A(3)
which contains
withouf
as deduction
Not alliwableu/s attracted in respect of salary payment of
Rs 2,00,000 outside
India by a compaty
40(a) is
Disallowance
at source.
deduction of tax
the
(0)Aliowableas deduction attracted even though
no disallowance
u/s 40A(3) is
to a scheduled bank, attracted
As per Rule 6DD,
if the payment is made no disallowance
u/s 40A(3) is
Therefore, in the given case,
the expense exceeds Rs 10,000.
cash payment for above mentioned exception
contained in Rule 6DD.
of sales tax is covered by the
since payment
cheque or accout
(vi)Allowable as deduction disallowance u/s 40A(3) for payment otherwise than by way of account payee
The limit for attracting or leasing goods carriage.
in case of payment made to transporters for plying, hiring cash to a
payee bank draft
is Rs 35,000 of Rs 30,000 made in
disailowance u/s 40A(3) is not attracted for payment
Therefore, in the present case,
transporter for carriage of goods.

Answer 51 Section 41(4) can be

be brought to tax u/s 41(4).
bad debt claim disallowed in the earlier year cannot
Recovery of a deduction earlier u/s 36(1)vi).
thereof has been allowed as
invoked only in a case where bad debts or part of which TDS provisions apply
in
The scope of Section 40(a)ia) has been recently
expanded to cover all sums respect of tax at source
D income u/s 192. Therefore, salary
payment without deduction
ax is required to be deducted on salary deduction fax at source would be
However, only 30% of salary paid without
WOuld attract disallowance u/s 40(a(ia).

disallowed u/s 40(a(ia). 24 lakhs (1/5th of Rs 120 lakhs)

from the Py of payment. Rs
t is deductible in 5
equal annual instalments commencing
is deductible u/s 35DDA for AY 2021-22
earlier allowed as deduction shali be taxed
amount recovered by the assessee against bad debt
ASper Section 41(4), any
tme/vijenderaggarwoltax) For Accessing Notes
Subscribe CA Vijender Aggarwal's Telegram Channel (hrtps Latest Subjective QáA Latest MCQs etc
Amendment Notes & Videos
Summaries Revisionory Videos
 By: CA Vijende er Aggatwg
BUSINESS/PROFEssION

14.76 PROFITS& GAINS OF Rs 50,000

would b e
taxable
the year
in the ve.
of
received There fore, in
this case,
rer
in the year in which it is
Ome
e PY 2020 21 (AY 2021 22)
the
not allowed a s
deducfion since
same has not
samo
Answer 52 are
31" O c t o b e r 2021)
to office building
taxes relating AY 2021-22 (1e
Per Section 438, municipal i n c o m e for
AS of r e t u r n of and put to use for
D e e n paid on o r before the
due date of fling it has been
acquired m
25%. Since is allowable as ded,.re
Patent
asset ehgible for
depreciation
is an intangiblePY 2020-21, full depreciation of Rs 5 lakhs (ie
257% of Rs 20 lakhs)
research expenditure incurred
deduction
s
Than 180 days during of scientific
35(2AB) in respect However
100% Is availabie u/s the prescribed aufhority.
(4) Weighted deduction research and deveiopment facility as approved by lakhs Rs 8 lakhs. =
on in-house 100% of Rs 8
Company
( i B a d debts of Rs 5,00,000
for written
deduction Deduction
off in the u/'s 35(2
books of AB)
account
=

as irrecoverable is deductible u/s 36(1)(vii) if su

the
kand is not elig1ble the
for the current year or
any of
of +
income of the company
while computing the
same has been taken into account
earlier preceding years provided to its emploveors is
non-nonetary perquisites
the in respect of
( Income tax of Rs 90,000 paid by company is exempt in the hands of the
10(10CC). Since the expenditure
u/s
exempt in the hands of the employees of Ramji Ltd as per Section 40(al.
deductible while computing the business income
employees, the same is not it is included in the
the company Since
fund is taxable in the hands of
(vi) The employees' contribution to provident Court has held that provident fund
AIMIL Ltd, the Delhi High
definition of income u/s 2(24). In CIT v even if it is
remítted after the due des.
the hands of the enployer date
contributien of employees is deductible in
Miscellaneous Provisions Act, 1952, provided the same is remitted
under the Employees' Provident Fund
and
been remitted in July 2021 only, the samee
before the due date of filing return of income. Since the amount has
shail be allowed as deduction.
is disallowed u/s 37(28) while computing business
towards advertisement in souvenir of a political party
vii) Expenditure the payment is made by any
income. However, the same is deductible u/s
806GB from gross total income provided
mode other than cash.
was allowed in respect of the same
to the taxpayer
Refund of a trading liability is taxable u/s 41(1), if a deduction
(vii) in an earlier year. Since sales tax was ciaimed as expenditure in an earlier year, refund of the same during the year

would be taxable as per Section 41(1).

Answer 53
transaction tax paid by the assessee in
(i) True: Section 36(1)(xv) allows a deduction of the anount of securities
business during the PY as deduction from the
respect of taxable securities transactions entered into in the course of
business income of a dealer in shares and securities.
) True: As per Section 40A(3), in the case of an assessee following mercantile system of accounting, if an expenditure
has been allowed as deduction in any PY on due basis, and payment exceeding Rs 10,000 has been made in the
subsequent year otherwise than by an account payee cheque or an account payee bank draft, then the payment so
made shail be deemed to be the income of the subsequent year in which such payment has been made.
(Hi) True: As per Section 32, depreciation has to be provided mandatorily while calculating the PGBP income of the
assessee irrespective of the fact whether or not the assessee has claimed the same while computing his total income

(iv) True: Section 36(1)(ib) provides deduction in respect of premium paid by an employer to keep in force an insurance
on the health of his employees under a scheme framed in this behalf by GIC or any other insurer. The medical
insurance premiun can be paid by any mode other than cash, to be eligible for deduction u/s 36(1Xib).
(v)False: Expenditure incurred in making payment to the employee in connection with his voluntary retirement either
the year of retirement or in any subsequent year, will be entitled to deduction in 5 equal annual installments beginn
from the year in which each payment is made to the employee.
(vi) False: Additional depreciation can be claumed only in respect of eligible P&M acquired & installed by an assessee
1SSIOn
engaged in the business of manufacture or produc tion of any article/thing or in the business of generation, transmis
ired
or distribution of power. In this case, the assessee is engaged in trading activities and the new plant has been acqui
4 instaled in a trading concern. Hence, the assessee will not be entitied to claim additional depreciation u/s 32000

SubscnbeCA Vpender Aggarwol'e Telegram Chonnel (httpe /t meysenderoggarwaitax) For Accessing Netes
Summones Revsionary Videos Amenciment Netes & Videas Latest Subjective Q44, Letest MCQs etc
 14.77
.es&GAINS OF BUSINESS/PROFESSION
FITS & GAIN
CA Vijender Aggarwal
By:
Answer 5 4
tire revenue expendiTure of RS 2,40,000 on scientific research related to the business of the compary
any
quaifies
s for for deduction u/s 3b(1). If Raghav Industries
Ltd is engaged in the business of biotechnology or in
Eleventh
siness of
nanufacture or production of
man any article or thing other than those specified under the
hted d e d u c t i o n
of
and all other conditions listed u/s 35(2AB) are satisfied, it would be entitled to a
.de
to its business)
S c h e d u l e

Oo (100% of Rs 2,40,O00, being the revenue expenditure on scientific research related

Rs2,40,000(100%.
les that any capital expenditure (other t han expenditure on acquisitio of land) incurred on
ection 35 provides

scientific resea
earch related to the business carried on by the assessee is fully allowed as deduction in the i
incurred. hererore, Rs 7 lakhs (Rs 12 lakhs Rs 5 lakhs) is allowable as deduction for AY 2021-22
-

ich it is
for a
amount RS 50,000o
of Rs
of S0,0o paid tO Lndian Institute of Science,Bangalore, for scientific research qualifies
amount to
Therefore, Raghav Industries Ltd would be entitled
a
() The
weighted d e duction100%
uc of the sum paid u/s 35
c t i o n of
50,000
Rs 50, (ie 100%% of Rs 50,000) for AY 2021-22.
deduc

contribufion fo fhe account of an employee under a pension scheme referred to u/s

80CCD, up to
employer's business income.
of the employee in the PY, is allowable as deduction u/s 36(1)(iva) while computing
(10%of salary of 10% of salary. Accordingiy.
u/s 40A(9) would be atfracted only in respect of the amount in excess
Dicallowance
D
the a amount allowed wouid be Rs 23 lakhs and the balance Rs 7 lakhs would be disallowed
would be taxable
of PF contribution recovered from employees (ie Rs 12 lakhs)
the amount
. A S per
Section 2(24NX). u/s 36(1)(va) of amount credited to
a s income
of Raghav Industries Ltd. However, the company can claim deduction held that
Court has
of the employee in the provident fund. In cIT v AIMIL Ltd, the Delhi High
the account if it is remitted
contribution of employees is deductible in the hands of the employer
even
provident fund the
Miscellaneous Provisions Act. 1952, provided
due date under the Employees' Provident Fund and
after the
Since the entire amount has
been remitted
same is
remitted before the due date of filing return of income. as deduction.
would be allowed
of filing of return of income, the entire amount of Rs 12 lakhs
before the due date disallowed
to the employees is
tax of Rs 4.50,000
borne by the employer on non-monetary perquisites provided
v) The
u/s 40(a)(v). to change
of an imported machinery, due
Rs 1,00,000, arising at the time of making payment in respect
(vit) The gain of Section 43A, and
has to be reduced from the WDV of machinery
as per
in rate of exchange of foreign currency,
on such reduced cost.
depreciation would be computed

Answer 55
disallowance specified u/s 40A(3). payment in respect of the business expenditure ought
a) True: In order to escape the
draft or electronic clearing system. Payment
account payee cheque or account payee
to have been made through an
will attract disallowance u/s 40A(3).
through a cheque crossed as "& Co." receivable, in order to
to write off the amount due from a debtor as not
b) True: As a mandatory
general principle, it is
claim the same as bad debt u/s 36(1)(vii).
in accordance
deduct TDS from rent or royalty payable to a resident,
c) True: Section 40(a)(ia) provides that failure to
result in disallowance of 30% of such expenditure.
with the provisions of Chapter XVII-B, will

Answer 56
Computation of Total Income of Mr Raju for AY 2021-22: Amount (Rs) Amount (Rs)
Particulars
5,00,000
Net profit as per P&L A/c
Add: Ineligible expenses:
Excess commission paid to brother disallowed u/s 40A(2) 10,000
limit for one time cash payment Nil
Disallowance u/s 40A(3) is not attracted since the
operators. Therefore, amount of
is Rs 35,000 in respect of payment to transport
Rs 33,000 paid in cash to a transport carrier is
allowable as deduction.

after due date of filing of ROI

disallowed u/s 43B 40,000
Bank loan interest
term paid
State VAT disallowed [penalties are not allowed to be deducted since 5,000
penalty paid
in connection with infraction of lawv]
Such amounts are payable

Suhscribe CA VU ender Aggarwals Telegram Channel (https //t me/vi1enderaggarwaltax) For Accessing Notes,
Summarres Revis.onary V deas Amendment Netes & Viceos Latest Subjective Q&A, Latest MCs etc
 2,00,000 2,55.000
BUSINESS/PROFESSION

14.78 ROFITs & GAINs OF

to Pål A/c (15,000)
Depreciation debited
expenses/ineligible
incomes
(1,80,000)
ess Eligible
Drvidend from domestic
companies
10(1)]
(2.25,000)
[Exempt u/s working note
ncome from agriculture

D e p r e c i a t i o n under
the Income
Tax Act, 1961
(As per
books (it
has been
assumed
that (48,000) (4,68,000)
recorded in omission and that
month not erroneous

or Rs 4,000 per was an

and therefore the
y r e c o r d e d in the
books of
account

for the
same

Saary not satisfactory

explanation
offered
has
e assesee

deduction) Income u/h PGBP

2,87,000
Sameis allowabie as companies) 15,000
domestic
(Dividend from
Income u/h
Other
Sources

on housing
loan) (23,000)
Loss u/h HP (Interest 2,79,000
Gross Total Income

repayment of
housing loan (50.000)
8OC in respect
of principal 2,29,000
Deduction u/s
Less Total Income

Act 1961:
of Depreciation under the Income Tax Amount (Rs)
WN:Computation Particulars
2,10,000
Rs 2 lakhs
Rs 12 lakhs plus assets of
15% 14 lakh
on Rs (Opening WDV of
Depreciation than 180 days)
and used for more
purchased during the year 15,000
used for less than 180 days)
7.5% on Rs 2 lakhs (ie
cost of assets
Depreciation
u/s 32 2,25,000
Total Depreciation Allowable

Answer 57
Ay 2021-22:
Computation of PGBP income of Mr Q for Particulars Amount (Rs) Amount (Rs)
93 950
Net profit as per P&L A/c
Add: Ineligible Expenses: 1,00,000
Expenses on buildinga new toilet is
in the nature of capital expenditure and
thus not allowable as per Section 37(1).
TDS has not been deducted at source disallowed u/s 15,000
Interest payable on which
to a resident)
40fa) to the extent of 30% (assumed that interest is payable
Penalty for contravention of Central GST Act [Penalty paid for violation or 24,000
infringement of any law is not allowable as deduction u/s 37(1)]
Payment to IIT, Mumbai for scientific research programme (separately shown)) 1,00,000 2,39,000

Less: Ineligible Incomes/Eligible Expenses:

Interest from company deposits (chargeable u/h other sources assuming that (6,400)
the same is not in the nature of a business income)
Income tax refund (not an income chargeable to tax) (8,100)
Weighted deduction 100% u/s 35(2AA) for payment to IIT for an approved (1,.00,000)
Scientificresearch program (1,14,500)
PGBP Income 2,18,450
g O F I T S& GAINS OF BUSINESS/PROFESSION
G A I N S

Aggarwa
By: CA Vijender

GBP income of
MrA for AY 2021-22:
NTaTion o f

Particulars Amount (Rs)

Amount (Rs)
PdL Alc 94,500
per
profif
a5le Expenses:
Net
ses on raising compound wall is in the nature of capital expenditure and
Enpen
95,000
allowable as per Section 37(1).
not
thus
Interestpayable outside India to a non-resident disallowed as
nble out. tax has not 12,000
at source [Section 40(a)(i01
been
deducted
ine contrav
.Penaltyfor contravention of Central GST Act [Penalty paid for violation or 24.000
untringement of any law is not allowable as deduction u/s 37(1)]

for scientific research(to be treated 1,00,000 2.31000

Contribution
separately)
ble Incomes/Eligible Expenses:
L e s s :
Tnterest from company ieposits (chargeable u/h other sources assuming that (6.400)
is not in the nature of a business income)
thesame
Dividend
(3,600)
Income tax refund (not an income chargeable to tax) (4,500)
(1,14.500)
Deduction u/s 35 for scientific research
(Note) (1,00,000) 2,11,000D
PGBP Income
scienfific research association qualifies for deduction 100% u/s 35(1)in).
Cor Cantribution to approved
Nete:

AnSwer 59
Mr Gupta for AY 2021-22:
o m
utation of Gross Total Lncome of Particulars
p u t a t i

Amount (Rs) Amount (Rs)

11,50.000
and Loss Account
Net profit as per Protit
Expenses/Eligible Income:
Add: Inadmissible deduction from the 1,00,000
.Donation to Prime Minister Relief Fund (Not allowed as
business income; rather
allowed as deduction u/s 806)
0,000
Provision for debts (Bad debts are allowed to be deducted
bad on actual basis)
deduction 20,000
Family planning expenses (Expenditure on family planning is allowed as

u/s 36(1)ix) only to a company assessee)

1,00,000
Income tax (Tncome tax is a personal liability
of the assessee)
due date of filing of ROI (No deduction
25,000
Employer's contribution deposited after
due date of filing of ROI)
available in respect of amount deposited after
fund (Employees 25,000
contribution deposited after due date of provident
Employees the amount deposited till the
contribution is treated as income u/s 2(24) and
amount not deposited till the due
due date is allowed as deduction. Therefore,
date will form part of business income for the assessee)
Depreciation as per books of accounts 30,000 3,50,000
LessDepreciation as per Income Tax Rules,1962
(40,000)
Income 14,60,000
Business Income/Gross Total
(1,00,000)
Less Deduction u/s 80G
Total Income 13,60,000
of payment of interest on bank loan. Therefore, disallowance
Note
TDS provisions u/s 194A are not attracted respect
in
WS
40(a{ia) is not attracted in this case.
ince, fhe payment of bonus is made in October
2020, hence, no disallowance is attracted.

Chane' (https mevJenderdggarwaitax) For AccesSing Notec

ubscr be CA Vijender Aggarwal's Telegram
Amendment Notes á Videos Latest u0je.tive GáA Lotest McQs ete
Summaries, Revisionary Videos
 By: CA Vijender
14.80 ROFTTS & GAINS OF BUSINESS/
PROFESSION
Aggarw
Answer 60
Smtetienef Tetg Inceme et Mra Yfer AY 3921RR Amount (Rs)Amout (Rs)
Particulas
3,01,250
Net Profit per PAL
as
A/
Less: Ineligible Incomas (10,500)
.Drvndend from Indian Compones (1,750)
Inc one tax retund
(7,000)
Winning from lotterves
Honorarvum for valung answer books
(24,000)
Add. Ineligible Expenses R s 60,000) 21,000
Excess depreciation charged (Rs 81,000 22,000
usse
Cost of medicnes, needles, etc for personal
Donotion to Prime Mnister's Relief
Fund 20,000
Business/Profession
Income under the head 3,21,000
Inceme frem Other Sources: 10,500
Dividend from Indian Companies
Honerarum for valuing answer books 24,000
Winning from Lotteries (7,000 3,000) 10,000
Income under the head other sources
Gross Total Income
44.500
3,65,500
Less: Deduction u/s 80C {(LIC Premium (max 10% of sum assured)) (5,000)
Less: Deduction u/s 806 (Donation to Prime Minister's National Relief Fund (100% deduction)) (20,000)
TotalIncome 3,40.500
Computation of Tax Liability:
Particulars Amount (Rs)
Tax on Rs 10,000 30% u/s 115BB 3,000
Tax on normal income Rs 3,30,500 at slab rates 4,025
Less: Rebate u/s 87A (7,025)
Tax Liabity Nil
Less: TDS (3,000)
TaxRefund (3.000)
Nete 1: As per Section 58(4), no deduction in respect of any expenditure or allowance is allowable in respect of
winnings from lotteries. Hence, Rs 2,500 paid for purchase of lottery tickets is not allowable as deduction.
Note 2 (Maturity Proceeds of Life Insurance Policy Rs 57,860 has been taken as wholly exempt from tax u/s 10(100)
assuming that the premium paid during any of the years of the policy does not exceed the specified percentage of the
actual capital sum assured.

Answer 61

Computation of Total Income of Dr Dheeraj for Ay 2021-22:

Particulars Amount (Rs) Amount (Rs)
Income from Business/Profession:
Net Profit as per Income & Expenditure Account 6,58,700
Less: Eligibile Expenses/ Ineligible Incomes:
LIC Policy matured (115,000)
Honorarium for giving lectures at seminoars (24,000)
Winning at TV game show (net of TDS) (35,000)
Depreciation as per income tax rules (75,000)
Add: Ineligible Expenses
Donation to National Children's Fund
51,000
Depreciation 1,25,000
Medicine consumed by self & family
18,000
Subscribe CA Viyender Aggarwal's Telearem Channe(hrtps t me vijenderaggoruotax) For Accessing No tes
Summares Revisionary Videos Amesdine nt Noter 4 Videos Latest Subyective Q5A Latest MCQs et