11.

32
Set-off and Carry Forward of Losses
Exercises
L Exercises explaining provisions: Income tax Provision relating to set-of and carry
forward:
1. Compute the gross total income from the particulars given below:
Rs.

House property (let) 30,000

HLoss from self occupied house 16,000
Income from let out houses 20,000
[Source: Madras, B. Com., Old, Nov. 2010]
[Ans : Income from house property: Rs.34,000]
income.
Hint: Loss from self occupied house can be set-off against let out house
2. Mr.X furnished the following details:
Salary income (Computed) Rs.42,000
Income from house property:
House A:
Rs.38,000 (Income)
House B: Rs.17,000 (Loss)
House C: Rs.21,000 (Loss)
Compute his income for the Assessment year 2023-2024.
[Madras, B. Com., Apr.2009)
[Ans.: Total Income Rs.42,000]
assessment year
3. Mr. Praskash submits the following information relevant for the
2023-24:
Rs.

Salary income computed 5,00,000

Income from house property :
40,000
House A (Computed)
House B 2,70,000 (Loss)
2023-24.
Determine the net income of Mr. Prakash for the assessment year
|Ans : Net income: Rs. 3,00,000]
HP loss C/F: Rs. 30,000
other head's income (other
Hint :House property loss can be set off against any set offagainst HP
than casual income). Upto Rs. 2,00,000. Excess as C/F and
income in subsequent years.
the previous year ending
4. Mr. Rajan, submits the following information relevant for
March 31, 2023.
Rs.
-2,60,000 (Loss)
Income form House property
2,50,000
Business Income
10,000
Short-term Capital Gain
Determine the net income. (Ans: Income Rs. 60,000)
11.33 Income Tax Theory, Law & Practice:A.Y.
Hint:House
2023-620,0240 0)
|Ans : House property loss C/F
property loss can be set off against other heads of income upto Rs.
5.
Excess carried forward
is and set off
against house property
Sanjoy submits the following information relevant for the
in the .2,
subsequent00,0
assessment year 2023.3%
00
yea

Rs.
Salary income(Gross) 63,000
Business Income 80,000
House property Income -20,000
Determine the net income of Sanjoy.
JAns : Net income: Rs. NI:
(63,000 -- 50,000 -13,000)
HP Loss C/F:7,000
Business loss C/F : Rs. 80,0001
Hint: (1) Standard deduction u/s 16(ia) is to be
least of salary income or Rs. 50,000.
reduced from gross salary as
(2) Business loss cannot be set off against salary
income.
(3) House property loss can be set off against salary income.
6. Mr. Sreenivasan, submits the following
ending March 31,2023.
information, relevant for the previous year
Rs.
Income from business
Business I
18,000
Business II
-30,000
Income from other sources :
Interest on securities
Bank interest
-12,000
16,000
Lottery winnings 60,000
Determine the net income.
JAns : Net income: Rs. 60,000. Business loss C/F 8,000|
Hint : Casual income cannot be used to set off any loss.
7. Mr.Appu submits the following information for the previous year. How will you
adjust the losses shown by him?
Income from salary (Computed) Rs. [+] 50,000
Income from House Property Rs. H 7,500
Business Loss Rs. [J15,000
Bank Interest Rs. [+] 30,000
[Madras B. Com April 2015, April 2017| [B. Com., (CS) Apr. 2011
[Ans : Gross total income Rs.57,500|
Set-offand Carry Forward of Losses
11.34
Hint: (1) House property loss of current year can be set-off
(other than casual income) against any income
(2) Business loss can be set-off
againstany income other than
salary income
and casual income.
8. Mrs. Amutha has shown the following incomes and losses in her income tax return
for the previous year 2022-2023. You are asked to comnpute her business income.
Profit before adjusting the following items for the previous year 2022-23 is
Rs.6,00,000,
Rs.
Current year depreciation 50,000
Carried forward business loss (PY, 2021-22) 10,000
Current year capital expenditure on scientific
research and family planning 20,000
[Madras, B. Com.,Apr. 2007|
[Ans : Business Income Rs.5,20,000]
Hint : (1) B/f. business loss can be set-off against business income only.
(2) Capital expenditure on scientific research can be set-offagainst business
income. Family planning expenditure is allowed to be reduced for
planning
company assesses only. Since scientific expenditure and family income.
expenditure is not separately given, it is reduced from business
business income of an individual for the assessment year 2023-24 has been
9. The
1,50,000. Later, it is found that he has
determined by the Assessing Officer at Rs.
determining the income :
not considered the following while Rs.
12,000
(a). Depreciation for thecurrent year 15,000
brought forward
(b) Unabsorbed depreciation carried forward
(c) Unabsorbed business loss 3,000
from assessment year
2022-23
Assessment year 2023-24.
Determine the total income for the [Madras, B. Com.(CS) April
2006]
1,20,000]
[Ans : Total Income : Rs.
Unabsorbed depreciation is allowed to be set off.
Hint : (1) brought forward can be set off againstbusiness
business loss
(2) Unabsorbed
income only.
particulars, calculatetotalincome: Rs.
10. . Fromthe following
2.00,000
Loss from business 40,000
Depreciation for the Ay.
 11.35 Income Tax Theory, Law. & Practie:A.Y. 202320
House property income 4,00,000
Items carried forward from earlier years :
Business loss of AY. 2022-23
2,40,000
Unabsorbed depreciation 1,00,000
Madras, B.Com., (CS) Old,
|Ans : Total Income : Business loss of AY. 2016-17, c/t. Nov.2011|
Rs.2,40,000:
House property income Rs.60,000 (4,00,000 -
Hint : (1) Current previous year or assessment year2,00,000-40,000-1,00,000)1
business loss can be set-ofF
against any income other than salary and casual income. Brought forward
business loss can be set-off against business income only.
(2) Current previous year or brought forward depreciation can bet set-off
against any incomne other than salary income and casual income.
11. From the following particulars, calculate total income :
Rs.
Loss from business 4,00,000
Depreciation allowance for the AY. 80,000
House property income 8,00,000
Items carried forward from earlier years :
Business loss ofAY: 2022-23 4,80,000
Unabsorbed depreciation 2,00,000
[Madras B. Com Nov. 2019] [Madras, B. Com., (CS), (Old), Nov. 2011)
[Ans : Total Income : House property income Rs.1,20,000
(8,00,000-4,00,000-80,000-2,00,000;
Business loss of AY. 2017-18, c/f. Rs.4,80,000)1
Hint : (1) Current year business loss can be set-off against any income other than
salary income and casual income. Brought forward business loss can be
set-off against business income only.
(2) Current year depreciation and brought forward depreciation can be
set-offagainst any income other than salary income and casual income.
12. Compute the taxable income and loss to be c/f.
Rs.
(a) Business profit for the previous year 2022-23 20,000
(b) B/f.business loss of 2020-21 10,000
(c) Capital loss on shares 60,000
(d) Loss from selfoccupied house (u/s 24) 5,000
[Madras, B. Com., (CS) Non 2011/
Madras, B.Com., Apr. 2010/
[Madras, B.Com., (CS) Apr.2009)
Set-offand Carry Forward. of Losses
11.36
|Ans :Taxable
Hint : (1) Capital loss on shares Capital loss of sharesincome
C/f.: Rs.5,000;
capital gain only. (Assumed to be unlisted) can Rs.60,0001
be set-off
(2) Brought forward business loss against
can be set-off
only. against business income
(3) Loss from self
occupied house of current year can be set-off
income other than casual income. against any
13. Mr. N. discloses the following incomes from business or profession forthe
year 2022-23.
prevíous
Rs.
() Profit from 'A' business
(i) Loss from B' business 5,00,000
1,00,000
(ii) Loss from Profession C'
1,50,000
(iv) Profit from speculation business D'
2,00,000
(v) Loss from speculation business E'
3,00,000
Determine the income from business or profession for the assessment year
2022-23.
[Madras, B.Com. Nov. 2006]
[Ans :Income from business : Rs. 2,50,000;
Speculation Loss C/F:Rs. 1,00,000]
Hint : (1) Speculation Loss can be set off against speculation income and not
against other business or other heads income. Unadjusted speculation
loss can be C/F for 4 subsequent years to be set-off against speculation
income only.
(2) Current year loss under the head business can be set off against any
business income or other head's income. (Other than salary and casual
income)
14. Compute the gross total income of Mr.X from the following details :
Rs.
() Speculation loss 60,000
(ii) Income from house property 5,000
(ii) Non-speculation business income 1,00,000
(iv) Winnings from cross-word puzzles 50,000
[Madras, B.Com., Apr. 2007}
Ans : Gross total income: Rs.1,55,000;
Speculation loss CIE. Rs.60,000]
:Speculation business loss can beset-offagainst speculation business income only.