I PCC Tax Exam analysis and solution to practical questions

Give the List of wrong answers... 

Sir, 

what about PCC solutions??

Originally posted by : anuj
	no offences sir...but i cud not reely stop myself frm askin dis....did u do a balanced study???haha ....sry....

Anuj, 

There are two questions of capital gain. I hope your question is related with Question 5 (a) where a house is purchased by one person is gifted to another person (specified mode).

Before making the Gift there was an attempt to sell the property by the orginal owner and received an advance of Rs 25000/- and later the property is gifted.

If the property is acquired to specified mode, then the cost to the previous owner will be taken in to consideration. However, if the property acquired before 1981 one more rule will be there "Higher of FMV or cost of acquisistion.

Cost in the minute sense shall be amount paid for acquiring the house and any  amount recovered as advance and these shall be taken to reduce the cost of acquisition. Forfeiture of advance is a beneift which is arised due to the capital assest . If we taking cost of asset to the previous owner, these benefit is required to be adjusted in the cost of acquisition of orginal asset else the calculation will go wrong.

Section 51 clearly says to deduct the same from the cost of asset. If there is any provisions which clearly state that the advance received by the previous owner shall not be deductible then i am in correct. 

Originally posted by : anuj
	no offences sir...but i cud not reely stop myself frm askin dis....did u do a balanced study???haha ....sry....

You do a better balanced study for clearing your exam than suggesting me since i dont have any exam. If you want to correct me with respect to solutions then your suggession is always welcome and the forum thread can be add more value. Dont breake "your heart" since it is valuable things.. I think many of the students were not reading the disclaimer i have made in the begining of the forum..

All are trying to tell it is incorrect but not telling where  it is incorrect and what are the steps to be taken to correct it. 

Where any capital asset was on any previous occasion the subject of negotiations for its transfer, any advance or other money received and retained by the 'assessee' in respect of such negotiations shall be deducted from the cost for which the asset was acquired or the written down value or the fair market value, as the case may be, in computing the cost of acquisition.
dis is d bare act's section 51....if u take d literary meaning....d advance taken only by d assesee is deducted frm cost....m sorry sir....but i guess i caught a huge mistake in ur concept of taxation.....here d "Assessee" means a person by whom any tax or any other sum of money is payable under this Act,i ve quoted dis frm section 2(7) incum tax act 1961....n here d assessee is d transferor not d transferee.....
i ws taught dis by ca ajay jain sir....i hope u ve heard his name....u cant b questioning his concepts....okk sir i 'll just tell u d other mistakes

ya agreed sir

some of the solutions are incorrect

plss check

thanks for the solution

cheers

in d first question's first part....d shares dat were sold first were xempt frm tax under section 111a....since deir profits were not chargeable 2 tax...deir losses won't b allowed set off either ...dats my opinion only i guessed it but m not sure....

in d first question's first part....d shares dat were sold first were xempt frm tax under section 111a....since deir profits were not chargeable 2 tax...deir losses won't b allowed set off either ...dats my opinion only i guessed it but m not sure....

in 1(c) any amount recieved in advance is also taxable as per rule 6 str 1994....but u quoted xactly d opposite

Anuj,

Can you let me know the tax treatment of advance amount received by the orginal owner ?? Second point asset is acquired through specified mode and hence cost to the previous owner is taken in to the consideration.  I am still confuse with this particular area since this will affect capital calcuation if we have not adjusted the cost.

I am not questioning  any body Concepts, i am questioning my self. 

Originally posted by : anuj
	in 1(c) any amount recieved in advance is also taxable as per rule 6 str 1994....but u quoted xactly d opposite

Let me check  and will take the step to correct it

Originally posted by : anuj
	in 1(c) any amount recieved in advance is also taxable as per rule 6 str 1994....but u quoted xactly d opposite

Yes sir, he's right. Maybe what you had learnt has changed overtime as laws change every year?

answer to above capital gain is ryt but u have erred in COA... previous forfieted money is not taken into considerationj ie; Rs25000

Advance amount is also taxable under all circumstances....