Dissection of CA Final (new syllabus) - Direct Tax Laws and International Taxation, May 2019

Sr. No.

Topic / Chapters under FOCUS

Marks

1

PGBP

10

2

Deductions from Gross Total Income

2

3

ICDS

2

4

MAT

8

5

Taxation of Non-residents

6

6

Taxation of Charitable Trusts

8

7

Transfer Pricing

12

8

TDS and TCS

8

9

Assessment / Reassessment

4

10

Powers of IT Authorities

4

11

Authority of Advance Rulings

3

12

Equalization Levy

3

13

Tax Planning

4

14

Liability in Special Cases

4

15

Application and Interpretation of Treaties

6

Total

84

Question No.

Topic / Chapter

Marks

Relevant Provisions under Focus

Tricky Adjustments / Comment on difficult part of the question

Apparent error in the question paper

1

Computation of Total Income

14

Various adjustments encompassing through chapter 'PGBP'- Section 32, Section 41(1),

Section 36(1)(va),

Section 36(1)(iii),

40(a)(ia) read with section 194C.

- Applicability of Section 80JJAA

- Adjustment (v) expects clarity about meaning of 'Work' under section 194C

- Adjustment (1) under additional information pertaining to ICDS X

2 (a)

MAT

8

Section 115 JB(2A) and Section 115 JB(2C)

How to compute book profit for the IND AS compliant company

2(b)

Taxation of Non-residents

6

Chapter XIIA

Section 115C to 115I

Computation of exemption from capital gain under section 115F

Mr. Sumedh invested in notified saving certificates referred to in section 10(4B) on 30.03.2019.

Comment: Notified certificates were last made available before 1st Day of June, 2002.

3(a)

Taxation of Charitable Trusts

8

Various adjustments encompassing provisions of Section 11(1), Section 11(1A), Section 11(2), Section 11 (6)

Adjustment No. (a)(ii)- Where trust need to take permission for utlisation of donation Rs. 20 lakh in the next financial year

Adjustment No. (c) focuses on explanation 3 to section 11(1), a recent amendment

Adjustment No. (d)- focuses on computation of capital gain and its exemption under section 11(1A)

Adjustment No. (e) and (g) where students need to select an option either to claim depreciation or application of income keeping in mind the provisions of section 11(6)

Adjustment No. (h) focuses on explanation 2 to Section 11(1), a recent amendment

3(b)

Transfer Pricing

6

Cost Plus Method for determination of ALP

Students may forget to mention the amount of adjustment to be made to the total income as expected in point no.(2)

4(a)

Tax deducted at source

2

Section 194C

Students were expected to comment on the meaning of 'work'

4(b)

Tax collection at source

2

Section 206C

Students were expected to comment on declaration to be submitted as per section 206C(1A)

4(c) Either

Tax deducted at source

4

Section 194A

Special emphasis on CBDT circular No. 23/2015 read with SC judgment

4(c) or

Tax deducted at source

4

Section 194B and Section 194 J

4(d)

Transfer Pricing

6

Section 92CB and Section 92CE

Students were tested on applicability of Safe Harbour Rules more particularly when other party is located in NJA

5(a)

Assessment / Re-assessment

4

Section 147 and Section 149

Students were expected to recall the concept of 'Deeming Escapement' and the time-limit for re-opening the assessments in respect of undisclosed foreign assets

5(b)

Powers of Income Tax Authorities

4

Section 133A

Timings of Survey and the Powers of Assessing Officer during Survey

5(c)

Authority for Advance Rulings

3

Chapter XIXB

Focus on maintainability of application if matter pending before I.T. authority- Settled legal Position in case of Erriccson

5(d)

Equalization Levy

3

Equalization Levy

Students were expected to compute Interest and penalty.

6(a)

Tax Planning

4

Theory

Students were expected to write about two important test for successful tax planning

6(b)

Liability of Special Cases

4

159

Suggest the course of action to the legal representative

Question is silent about the section under which assessing officer has issued notice requiring to file the return.

6(c)

Application of Interpretation of Treaties

6

-

Students were expected to demonstrate reasons for correctness or otherwise of the two statements given in the question paper