My solution on DT (old) May 2010

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8-c..          shares are not assetsu/s 2(ea).

and jewellery are not in hand as on 31 march..

hence no wealth tax--as per my view

Originally posted by : LAXMIKANT AGARWAL
	8-c..          shares are not assetsu/s 2(ea). and jewellery are not in hand as on 31 march.. hence no wealth tax--as per my view

jewellery was pledged not sold, so unless it is not sold or transfered it will asset.

Dear Shashank,

Very good attempt.

For Q.4 (a) - ALP - I differ from your answer. When more than 1 ALP calculated by appropriate metnod then Average of these should be considered. If the Average is 5% more than the TV then Average should be the considered other wise no change.

Please provide your opinion.

a) Assessee is correct, CIT v. Budhewal Co-operative Sugar Mills Ltd. (2009) 312 ITR 92 (P & H)

Dear but Honourable Supreme court of law has said that Mens rea is not required when default is made and AO dont required to prove that Mens rea is present at the time of comiting an offence therefore AO is correct .

8-c....it is immaterial whether it is pledged or sold...until and unless Assessee has ownership on the date of valution it is assest.

3-d 2(47) Transfer inculdes ansy capital asset sold discarded demolished it amount to transfer accordingly considerations on the date of transfer  less wdv sec 43(6) is capital gain or loss ,and interest received for delayed payment of consideration is taxable under the head income from other sources and not under business or profession .

8.a.ii...not correct.....officer if he prooves that he was not a party at the time default or not due to his neglegence then he is not a party to the default.

5.a.Dear you might be wondering whenver the legislator wants to add something in that definitions then they have given widest scope for that and they said inclusive.Further as per General rule of Interpretations whenver plain meaning is available for word or definitions then that prevails over other meaning and definitions......Hence 56(2) (vii) w.e f 1.10 2009 moveable or immoveable property transfered without consideration then it is taxable in the hands of receipeint .

in the given case Motor car is transfered the plain availble in General clause act 1957 is moveable ,hence it is taxable on or after 1.10.2009 no question of confusion.

4.a Finace Act (No.2 ) 2009 amended the provision whenver more than two prices are available under appropriate methods then airthmatical mean has to computed of these prices and difference between this price and transaction price is more than 5% then airthmatical mean is the price otherewise the price at which transaction is taken place.

in the given case it is 4% therefore it is transaction price.

Q.3

a) Yes, Taxable on dividend- Tax to be deducted in India less Tax deducted in Malysia.

Since with Malyasia DTAA is available as this if assesee ahas residence in both the countries then only assesse close relationship and economic interest is to be seen (refer P.V.A.L Kulandagan Chettiar vs CIT (SC).But in the given case assessee has residenc ein india therefore it is taxable whether it is dividend or interest .Further Sec.91 relief is availble to assessee since satisfied all the conditions of sec.91

I agree with you for Car u/s 56(2). The relevant amendment from sup study paper is as follows -

(iv) If movable property is received without consideration, the aggregate fair market

value of such property on the date of receipt would be taxed as the income of

the recipient if it exceeds Rs.50,000. In case movable property is received for

inadequate consideration, and the difference between the aggregate fair market

value and such consideration exceeds Rs.50,000, such difference would be

taxed as the income of the recipient. The CBDT would prescribe the method of

determination of fair market value of a movable property.

(v) The table below summarises the new scheme of taxability of gifts with effect

from 1st October, 2009 -

Nature of asset Particulars Taxable value

1 Money Without

consideration

The whole amount if the same

exceeds Rs.50,000.

2 Immovable property Without

consideration

The stamp value of the

property, if it exceeds

Rs.50,000.

3 Immovable property Inadequate

consideration

The difference between the

stamp value and the

consideration, if such

difference exceeds Rs.50,000

4 Movable property Without

consideration

The aggregate fair market

value of the property, if it

exceeds Rs.50,000.

5 Movable property Inadequate

consideration

The difference between the

aggregate fair market value

and the consideration, if such

difference exceeds Rs.50,000

Originally posted by : Ghanshyam Joshi
	Dear Shashank, Very good attempt. For Q.4 (a) - ALP - I differ from your answer. When more than 1 ALP calculated by appropriate metnod then Average of these should be considered. If the Average is 5% more than the TV then Average should be the considered other wise no change. Please provide your opinion.

i think you r right, i have done silly mistake.

Regarding Q.6.(b) ==> see the relevant paras from suppl study paper ==>

(iv) Clause (viii) has been inserted in section 56(2) to provide that income by way

of interest received on compensation or on enhanced compensation referred to

in clause (b) of section 145A shall be assessed as “Income from other

sources” in the year in which it is received.

(v) Clause (iv) has been inserted in section 57 to allow a deduction of 50% of such

income. It is further clarified that no deduction would be allowable under any

other clause of section 57 in respect of such income.

(vi) Example

Interest on enhanced compensation received by Mr.G during the previous year

2009-10 is Rs.5,00,000. Out of this interest, Rs.1,50,000 relates to the previous

year 2006-07, Rs.1,65,000 relates to previous year 2007-08 and Rs.1,85,000

relates to previous year 2008-09. Discuss the tax implication, if any, of such

interest income for A.Y.2010-11.

The entire interest of Rs.5,00,000 would be taxable in the year of receipt,

namely, P.Y.2009-10.

Particulars Rs.

Interest on enhanced compensation taxable u/s 56(2)(viii) 5,00,000

Less: Deduction under section 57(iv) @ 50% 2,50,000

Interest chargeable under the head “Income from other sources” 2,50,000

(Effective from A.Y.2010-11)

Deduction u/s 57(iv) is to be allowed and the income is taxable u/head "Income from Other Source".

i agree for interest on enhanced compensation but for car i think its not defined in property as per sec56(2). if its correct then i will get mark for it.

hey check out my answer on IDT

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My frd i m not agree for some points..they are

2(a) 2 case laws 1)Dharmendra textiles 2)Rajsathan spping and weaving mills...final ans assessee is correct.

3(a)   yes dividend is taxble but releif can be taken Bilateral or unilateral relief..it depend on double taxation avoidance agreement.

4 (a) ALP mean is 52 n TP is 50 lacs so difference of 4% no adjustment required.

4(c)Yes power of attoreny provision is correct but it is written that land is held as stock in trade so how sale of SIT will attract Capital Gain?I m also confused n written both answers.

5(c)40A(3) payments made for fish products are exempt so payment to hawkar or local fisharmen in not relevant fish products are relevant..so in both cases rule 6DD will apply becoz lobsters and crabs are covered under fish products.

2(b)Date of warrant is Important bcoz provisions are applicable from 1.10.2009.so assumption of date is must for any answer.

7(b) my answer is yes also but not finding any case law or reference in section..if u have found clearify it..

For rest i am agreed..

N pls give me source of CIT v L&T limited..my ans is also same as u but not given any case law reference so just wanna check..

ever thing is correct except ALP. I have wrongly written n for case law of L&T you can see recent case law

My Answer for Q4 c) The Land was held by assessee as stock in trade and not as Capital Assets.

so Capital Gain..... It will be under PGBP, as stock is sold/ Transfered.

Now relating to year of taxability. The transfer in nature of Sec53A of Transfer of Immovible Property Act.... So it'll be Charge in AY 20010-11.