Illustration-1

Compute the tax payable by a company for the A.Y. 2023-24, if IT is₹ 8,00,000 and book profit is
30,00,000

Illustration-2
The total income of a company is ₹5,78,000 out of which Long Term Capital Gain is ₹33,000
and Income from Business is ₹5,45,000. The Book Profits of the company is ₹10,00,000.
Compute the tax liability. (Ignore Alternative Tax Regime under Section 115BAC)

Illustration-3
From the following details, calculate the amount of tax payable for the A.Y. 2023-24
Tax liability ₹3,09,000
Minimum alternate tax ₹6,18,000
Calculation of the amount of tax payable of the A.Y. 2023-24 (Ignore Alternative Tax Regime)

Illustration-4
The following is the profit & loss account of a ABC Ltd. For the year ended 31.3.2023. Compute
its taxable income from business for the A.Y. 2023-24:
Particulars ₹ Particulars ₹

To Cost of crane crushed 14,000 By Sales 28,24,200

To Repairs & renewal 59,400
To Miscellaneous expenses 8,39,200
To Commission 1,45,700
To Depreciation 1,30,700
To Reserve fund 1,15,000
To Net profit 94,200

28,24,200 28,24,200
Additional information:
1. Miscellaneous expenses include.
a) Contribution towards unrecognized provided fund ₹1,200
b) Donation to school ₹7,000
c) Commission is connected with issue of shares in setting up a new unit ₹2,000
d) Sales tax paid ₹2,00,000
e) Capital and revenue expenditure towards scientific research is ₹50,000 and ₹26,000
respectfully.
2. Distribution of free samples worth 1,000, which in not debited to profit & loss A/c.
3. Repairs and renewals include the cost of addition to factory building ₹15,000
4. Admissible depreciation is ₹98,200
5. Liability foregone by the creditor ₹10,000
Computation of taxable income from business for the A.Y. 2023-24. (Ignore Alternative Tax
Regime)

Illustration-5
Compute the taxable income of M/S Shanmugam Ltd. for the previous year 2022-23 from the
information given below: (Ignore Alternative Tax Regime)
Profit & Loss Account
Particulars ₹ Particulars ₹

To Office Cleaning Charges 20,000 By Gross Profit 2,00,000

To Salaries to Staff 80,000 By Long term capital gain 20,000
To Insurance on stock 25,000 By Interest 5,000
To Printing & Stationery 5,000
To General Charges 20,000
To General Reserve 25,000
To Interest of loan 40,000
To Provision for IT 2,10,000
To Net Profit 1,00,000

5,25,000 5,25,000
Additional Information:
1. The amount of interest is for Government Securities.
2. The depreciation admissible under the Act is 15,000.
3. General Expenses include ₹2,000 for office rent, ₹3,000 to bonus to staff ₹1,000 for donation
given to NDF.

Illustration-6
The Gross Total Income of M/s SNS Ltd. was computed for the A.Y. 2023-24 as follows:
1. Income from Rice Mill ₹1,50,000.
2. Income from Steel Company ₹1,90,000.
3. Profit of new industrial unit situated in Backward Industrial State which was established in
2011 ₹85,000
4. Income from Poultry Farming which was started in November 2010 ₹1,00,000.
5. Short term capital loss ₹60,000.
6. Income from Royalty from Indian Company 75,000.
7. Dividend from a domestic company 50,000.
8. Long term capital gain ₹1,00,000.
9. Export Business Profit ₹3,00,000.
The Company donated ₹50,000 to Chief Minister's Drought Relief Fund.
Compute Taxable Total Income. (Ignore Alternative Tax Regime)

Illustration-7
The following is the information of Tanush and Co. for the A.Y. 2023-24, (Ignore Alternative Tax
Regime)
Particulars ₹ Particulars ₹

To Cost of goods sold 10,00,000 By Sales 14,00,000

To Tax relating to LTCG 3,000 By Long term Capital gain
To Depreciation 85,000 (Exempt u/s 10(38) 1,50,000
 To Proposed dividend 1,30,000 By Int. on Govt. securities 15,000
To Income Tax 60,000
To Net profit 2,87,000

15,65,000 15,65,000
Additional Information:
[Link] allowable for the year as per income tax act is ₹50000
2. Bought forward business loss as per books of accounts is ₹125000
3. Brought forwarded an observed deposition is ₹55000 compute:
(i) Total income of the company under normal provisions
(ii) Tax liability of the company
(iii) Tax payable U/S 115-JB

Illustration-8
Nirmala Roy Traders Limited closes its accounts on 31st March every year. For the financial
year 2022-23, the following details are given:
a) Income from royalty from a foreign company ₹2,00,000.
b) Income from units of UTI ₹10,000
c) Dividend from a Co-operative Society ₹50,000
d) Dividend from Foreign Company ₹1,50,000
e) Income from house property ₹31,500
f) Long term capital gain ₹60,000
g) Income from business (computed) ₹3,00,000
The business was started in the backward state in 2004-2005.
Donation to PM Relief Fund ₹1,00,000.
Compute Taxable Total Income for the A.Y. 2023-24. (under Existing Tax Regime
andbAlternative Tax Regime).

Illustration-9

The Profit & Loss A/c of the Arun Ltd., engaged in the business of Manufacture of electronic
goods. The net profit is ₹3,00,000 for the year ending. On verification thereof, the assessing
officer gets the following additional information.
a) A sum of ₹30,000 was imposed by the customs authority as penalty.
b) The company had given a donation of ₹15,000 to the prime minister Drought Relief Fund.
c) The company had received dividends from Indian company amounting to ₹44,750.
d) The company had borrowed a sum of ₹5,00,000 for investment in the share of another
company. Which was yet to declare dividend. Interest of ₹20,000. Calculated at the rate of 10%
is debited to Profit & Loss A/c.
e) The company indulged in speculation and incurred a loss of ₹35,000.
You are required to compute total income of the Arun Ltd. (Ignore Alternative Tax Regime)

Illustration-10
From the particulars submitted below, find out the total income of ABC Co. Ltd. (under Existing
Tax Regime and Alternative Tax Regime).
Profit and Loss Account
Particulars ₹ Particulars ₹

To Opening Stock 50,000 By Sales of Sugar 11,50,000

To Cane Purchased 4,70,000 By Transfer Fees 1,000
To Manufacturing expenses 2,50,000 By Rent of Agricultural Land 2,000
To Salaries and Wages 45,500
To General expenses 17,500
To Commission and Brokerage 36,000
To Interest on Loan 8,900
To Director's Fees 3,600
To Income Tax 35,000
To Reserve for Bad debts 19,500
To Depreciation 69,800
To Provision for Dividends 35,200
To Net Profit 1,12,000

11,53,000 11,53,000
Other Information:
1. General expenses include:
a) ₹7,000 as donation to Rajiv Gandhi Foundation.
b) ₹3,000 subscription to Sugar syndicate.
c) ₹2,000 commission to broker for arranging loan for the company.
d) ₹2,000 paid to a director for a trip to Kolkata to participate in the seminar.
2. The actual bad debts amounted to ₹8,000.
3. Depreciation is ₹70,000

Illustration-11
The following Profit and Loss Account of PQR Ltd. For the financial year ending 2022-23.
Compute its total income. (Ignore Alternative Tax Regime)
Particulars ₹ Particulars ₹

To provision for tax 1,50,000 By Gross profit 6,50,000

To Rent and taxes 15,000 By Profit on sale of machinery 18,000
To Fire insurance 8,500 By Interest on securities 12,500
To Establishment expenses 1,35,000 By Dividend received 50,000
To Depreciation 30,000 from Indian company
To Donation and charity 3,500
To General expenses 32,500
To Reserve for doubtful debts 5,500
To Entertainment 7,500
To Net profit 3,43,000

7,30,500 7,30,500
Additional Information:
a) The allowable depreciation as per IT Act ₹20,000.
b) Machinery were purchased in August 2019 and sold in March 2023.
c) Donations and Charities are paid to a Recognized Charitable Institution.

Illustration-12
Following is the Profit and Loss Account of Sri Lakshmi Narayan Ltd. An Indian company for the
year ending 31-3-2023. (Ignore Alternative Tax Regime)
Particulars ₹ Particulars ₹

Salaries and wages 7,50,000 Gross Profit 25,00,000

Advertisement expenses 1,50,000
Insurance 2,50,000
Audit fees 50,000
Depreciation 1,00,000
Income tax 30,000
Transfer to General reserve 40,000
Office expenses 15,000
Losses of subsidy company 25,000
Net profit 10,90,000

25,00,000 25,00,000
Additional Information:
a) Brought forward loss as per books of accounts is ₹1,25,000 and as per income tax is
₹1,50,000.
b) Unabsorbed depreciation as per books of accounts amount to ₹25,000 and as per income tax
ist ₹75,000.
Calculate:
1) Total income of the company under normal provision.
2) Book-profit and tax liability as per Section 115JB.
3) Tax liability of the company.

Illustration-13
The Gross Total Income of Aditri Ltd. was computed as under for the previous year 2022-23
Paper Mills Income ₹2,00,000
Mini cement plant ₹1,00,000
Export business profit ₹2,00,000
Profit from poultry farming ₹1,75,000
Long-term capital gain ₹50,000
Income from Royalty:
Royalty from HPH Pvt. Ltd. (Indian Company) ₹80,000
Royalty from Oxford Ltd. (Foreign Company) ₹85,000
Profit of hotel established ₹80,000
Profit from Small Scale Industry ₹50,000
Loss of Steel plant ₹2,00,000
Dividend from foreign Company ₹45,000
Company donated ₹ 1,00,000 Prime Minister National Relief Fund. You are required to compute
company's total income and gross tax liability. (under Existing Tax Regime and Alternative Tax
Regime).

Illustration-14

PQR Ltd., (Resident) earned a net profit of 14,25,000 after adjusting the following items to its
profit & loss account for the year ended 31.3.2023, (Ignore Alternative Tax Regime)

Items debited to Profit & Loss A/c ₹

1. Proposed dividend 90,000

2. Cultivation expenses 2,10,000
3. Provision in sale tax (paid before the due date) 1,00,000
4. Provision for loss of subsidiary 1,60,000
5. Provision for income tax 70,000
6. Provision and reserves 35,000
7. Expenses on purchase of equity share 15,000
8. Depreciation 4,40,000
9. Corporate dividend tax 75,000

Items credited to Profit & Loss A/c ₹

1. Agricultural income 2,20,000

2. Long term capital gain on sale of equity shares (unlisted) 4,30,000
3. Profits from speculation 1,00,000
4. Income from units of UTI 50,000
Additional information:
1. Depreciation include ₹2,00,000 on account of revaluation of fixed Assets.
2. Depreciation allowable as per IT rules is ₹3,60,000
3. Carried forward business loss and unabsorbed depreciation
Amount as per books Amount as per income tax

Loss Depreciation Loss Depreciation

2019-20 1,20,000 1,80,000 1,20,000 2,80,000

2020-21 1,30,000 2,00,000 1,80,000 1,50,000
2021-22 3,00,000 4,50,000 1,20,000 2,10,000
You are required to compute the tax payable by the company for the A.Y.2023-24.

Illustration-15
Following is the Profit and Loss Account of Sandesh and Company Limited for the Previous
Year 2022-2023, (Ignore Alternative Tax Regime)
To Establishment 2,50,000 By Gross Profit 12,00,000
 To Rent and Taxes 27,500 By Rent received (HP) 80,000
To Depreciation 60,000 By Profile on sale of fixed asset 37,000
To Fire Insurance 17,000 By Int. on Govt. securities 24,000
To Provisions for tax 3,10,000 By Dividend received from
To Entertainment expenses 14,400 subsidiary Company 20,000
To Donation to Rajeev Gandhi
Foundation 10,000
To General expenses 65,500
To Proposed dividend 10,500
To Net Profit 5,96,100

13,61,000 13,61,000
Additional Information:
1. General expenses include a sum of ₹9,600. Municipal tax and ₹1,600 insurance on house
property let-out.
2. Depreciation admissible as per IT law is ₹50,000
Compute the total income of the company for the A.Y. 2023-24

Illustration-16
Adithya Ltd., showed a profit of ₹3,35,000 2022-23 scrutiny of accounts revealed the following:
a) Donation to an approved charitable trust by cheque ₹20,000
b) Provision for income tax ₹1,00,000
c) Family planning expenses (Revenue) ₹25,000
d) Capital expenditure ₹1,00,000
e) Bad debts allowed earlier recovered during year ₹10,000
f) Interest on bank deposits ₹30,000
g) LTC gain ₹1,00,000
h) Debenture interest from another company (Gross) ₹20,000
Additional information:
i) Unabsorbed depreciation ₹30,000 and
ii) Unabsorbed long term capital loss of ₹40,000, brought forward from the earlier years.
Compute total income and tax liability of the company for the AY 2023-24, Applicable tax rate is
25%. (Ignore Alternative Tax Regime)