Direct Tax Laws & International Taxation - November 2019 MTP

Mr. A, aged 59 years, won Rs. 60 lakh and Mr. B, aged 50 years, won Rs. 8 lakh from lotteries. Tax deductible at source under section 194B was duly deducted. Assuming that this is the only source of income of Mr. A and Mr. B for A.Y.2019-20, are Mr. A and Mr. B liable to pay advance tax for that year? (a) No, Mr. A and Mr. B are not liable to pay advance tax as tax deductible at…

Mr. Vallish, employed as Manager with ABC Ltd. pays rent of Rs. 50,000 per month to his landlord. Which of the following statements are correct? (a) Mr. Vallish is liable to deduct tax@10% under section 194-I, since his annual rent exceeds Rs. 1,80,000. (b) Mr. Vallish is liable to deduct tax@5% under section 194-IB every month, since he pays rent of Rs. 50,000 per month. (c) Mr. Vallish is liable to deduct tax@5% under section 194-IB on the annual rent…

Mr. Sanjay, a resident, and Mr. Andrew, a British citizen and a non-resident in India, are both sports commentators deriving income of Rs. 5 lakh from sports commentaries in India for A.Y. 2019-20. (i) Tax is deductible u/s 194J from remuneration payable to Mr. Sanjay (ii) Tax is deductible u/s 194E from remuneration payable to Mr. Andrew (iii) (iv) Tax is deductible u/s 195 from remuneration payable to Mr. Andrew Mr. Andrew is not required to file his return of…

Mr. X is aggrieved by an order passed under section 143(3) by the Assessing Officer. Mr. Y is aggrieved by an order passed under section 272A by the Director General. What is the remedy available to Mr. X and Mr. Y and the time limit within which they should exercise the remedy? (a) Both Mr. X and Mr. Y have to file an appeal before Commissioner (Appeals) under section 246A within 30 days from the date on which the order…

Ram Mohan, a non-resident, operates an aircraft between Malaysia and Cochin. He received the following amounts while carrying on the business of operation of aircrafts for the year ended 31.3.2019: (i) Rs. 2 crores in India on account of carriage of passengers from Cochin. (ii) Rs. 1 crore in India on account of carriage of goods from Cochin. (iii) Rs. 3 crores in India on account of carriage of passengers from Malaysia. (iv) Rs. 0.50 crore in Malaysia on account…

Alpha Ltd., an Indian company, provides contract R & D services relating to generic pharmaceutical drug, to Beta Inc., a Swiss company which guarantees 17% of the total borrowings of Alpha Ltd. The aggregate value of such transactions entered into in the P.Y.2018-19 is Rs. 40 crores and the operating expenses are Rs. 30 crores. Assuming that Alpha Ltd. has exercised a valid option for application of safe harbour rules, what is the minimum operating profit margin to be declared…

As per section 245N(a)(iv), advance ruling means determination by the Authority for Advance Rulings or decision whether an arrangement, which is proposed to be undertaken by a person is an impermissible avoidance arrangement as referred to in Chapter X-A or not. For making an application in this regard, the applicant has to be (a) Only a Non-resident (b) Only a Resident (c) Only a Resident falling within such class or category of persons as notified by the Central Government (d)…

Gamma Ltd. has distributed on 15/12/2018 dividend of Rs. 460 lakhs to its shareholders. On 12/11/2018, Gamma Ltd. has received dividend of Rs. 120 lakhs from its domestic subsidiary company Phi Ltd., on which Phi Ltd. has paid dividend distribution tax under section 115-O. Compute the additional income-tax payable by Gamma Ltd. under section 115-O. (a) Rs. 59,40,480 (b) Rs. 66,76,800 (c) Rs. 69,88,800 (d) Rs. 80,37,120 (2 M arks)