.....Examine with reasons, for the following sub-divisions, whether the following statements are true or false having regard to the provisions of the Income-tax Act, 1961: (i) For a dealer in shares and securities, securities transaction tax paid in a recognized stock exchange is permissible business expenditure. (ii) Where a person follows mercantile system of accounting, an expenditure of ` 25,000 has been allowed on accrual basis and in a later year, in respect of the said expenditure, assessee makes the payment of ` 25,000 through a cheque crossed as “& Co.”, disallowance of ` 25,000 under section 40A(3) can be made in the year of payment. (iii) It is mandatory to provide for depreciation under section 32 of the Income-tax Act, 1961, while computing income under the head “Profits and Gains from Business and Profession”. (iv) The mediclaim premium paid to GIC by Mr. Lomesh for his employees, by a draft, on 27.12.2017 is a deductible expenditure under section 36. (v) Under section 35DDA, amortization of expenditure incurred under eligible Voluntary Retirement Scheme at the time of retirement alone, can be done. (vi) An existing assessee engaged in trading activities, can claim additional depreciation under section 32(1)(iia) in respect of new plant acquired and installed in the trading concern, where the increase in value of such plant as compared to the approved base year is more than 10%.
Dec. 09, 2017