UNIT II

INCOME FROM OTHER SOURCES

PROBLEM NO.: 1 ([Link] 9.21 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Guru furnishes the following particulars of his income for the previous year 2023-24. Compute his income from
other sources for the assessment year 2024-25.
a) Dividend (Gross) from Ashok Leyland ltd. Rs. 25,000
b) Dividend from a co-operative society Rs.5,000
c) Interim dividend from Rane (Madras) Ltd. Rs. 6,000
d) Dividend from a foreign company. Rs. 26,000
e) Dividend from UTI Rs. 3,000.
SOLUTION NO: 01
Particulars Rs.
Dividend from a co-operative society 5,000
Dividend from a foreign Co. 26,000
Dividend from Ashok Leyland ltd 25,000
Dividend from Rane Madras Ltd 6,000
Dividend from UTI 3,000
Income from other Sources 65,000

PROBLEM NO.: 2 ([Link] 9.23 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mr. Basu received the following incomes during the year 2023-2024. Compute taxable income under the head
‘Income from other sources’ separately for each case.
(A) Winnings received from Sikkim Lottery Rs. 70,000
Winnings from horse race Rs. 2,000
Winnings from Crossword puzzles Rs. 4,000
(B) Winnings from Lottery Rs. 2,000
Winnings received from Horse Races Rs. 56,000

SOLUTION NO: 02
A. Computation of income from other sources
Particulars Rs.
Winnings received from Sikkim Lottery 1,00,000
(70,000)X100/70)
Winnings from Horse race 2,000
(Less than 10,000 No TDS)
Winnings from Crossword puzzles 4,000
(Less than 10,000 No TDS)
Income from other sources 1,06,000
B. Computation of income from other sources
Particulars Rs.
Winnings from Lottery 2,000
(Less than 10,000 No TDS)
Winnings received from horse race 80,000
(56,000X100/70)
Income from other sources 82,000

1
PROBLEM NO.: 3 ([Link] 9.24 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Compute ‘Income from other sources’ from the following information for the financial year 2023-24.
Particulars Rs.
I. Amount won from:
Lottery 80,000
Betting on Horse Racing 8,000
II. Amounts received from:
Lottery 63,000
Betting on Horse Racing 42,000
III. Income from:
Lottery 1,800
Betting on Horse Racing 1,000
SOLUTION NO: 03
Calculation of income from other sources
Particulars Rs. Rs.
I. Winnings from Lottery 80,000
Winnings from betting on horse 8,000 88,000
II. Amount received from Lottery
(63,000X100/70) 90,000
Amount received from betting on horse race
(42,000X100/70) 60,000 1,50,000
III. Income from Lottery 1,800
Income from betting on horse race 1,000 2,800
Income from other Sources 2,40,800
PROBLEM NO.: 4 ([Link] 9.25 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mr. Kannan owns horses at Bangalore and Delhi. The horses run in races at the race courses in those
cities. For the year 2023-2024 Mr. Kannan submits the following details. Compute IFOS.
Amount
Particulars
Rs.
1. Expenses on horses at Bangalore 4,00,000
2. Expenses on horses at Delhi 6,00,000
3. Stake money received by horses at
Bangalore 5,00,000
Delhi 3,00,000
4. Mr. Kannan received on betting during the horse races at Bangalore 1,26,000
5. Kannan also received Rs. 49,000 as lottery winnings and his winnings
from card games were Rs. 20,000 during the year.
SOLUTION NO: 04
Calculation of IFOS of Mr. Kannan for the Previous year 2023-24.
Particulars Rs. Rs.
I. Income from maintenance of horse:
Stake money earned at Bangalore 5,00,000
Stake money earned at Delhi 3,00,000 8,00,000
Less: Expenses:
At Bangalore 4,00,000
At Delhi 6,00,000 10,00,000
Loss from maintenance of horse c/f to 4 years (2,00,000)
II. Casual Income:
Income from betting on horses:
Net received (1,26,000X100/70) 1,80,000
Lottery winnings received (49,000X100/70) 70,000
Income from card games 20,000 2,70,000
Income from other sources 2,70,000
2
PROBLEM NO.: 5 ([Link] 9.26 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Kanagasabapathy of Salem constructed a factory with Building, Plant, Machinery, Furniture etc.
however, he decided to lease out the factory on a hire charge of Rs. 25,000 per month. During the previous year
2023-2024, he spent Rs. 15,000 for repairs and Rs. 10,000 for insurance on the assets. Allowable depreciation
is, Rs. 35,000 P.A. Ascertain his income from other sources from the above details.

SOLUTION NO: 05
Calculation of income from other sources:
Particulars Rs. Rs.
Income from Letting of factory
(25,000X12) 3,00,000
Less: Expenses on factory:
Repairs 15,000
Insurance 10,000
Depreciation 35,000 60,000
Income from other sources 2,40,000

PROBLEM NO: 6 ([Link] 9.27 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
From the following details, ascertain the taxable interest income of Miss. Gayathri for the previous year
2023-2024: Investment in Tax free 10% Debentures in ‘X’ Ltd. (Unlisted) Rs. 1,40,000. Interest received on
Debentures in ‘Y’ Ltd. (Listed) Rs. 45,000.
SOLUTION NO: 6
Computation of Interest income of Miss. Gayathiri for the P/Y: 2023-24
Particulars Rs. Rs.
Interest on Tax free 10% Debentures in X Ltd.
(1,40,000X10/100) = 14,000X100/90 15,555
Interest on Debentures in Y Ltd
(45,000X100/90) 50,000 65,555
Taxable Interest 65,555

PROBLEM NO.: 7 ([Link] 2.429 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
Mr. A invested Rs. 1,00,000 in 9% tax-free debentures of a company. What will be his taxable
interest for the previous year ending on 31.3.2024 if the rate of deduction of tax at source is @ 10% interest
accrues on 1st January every year.
SOLUTION NO: 7
Computation of Interest on debentures
Particulars Rs. Rs.
Interest on investment on Tax free debentures
(1,00,000 X 9%) = 9,000X100/90 10,000
Taxable Interest 10,000

3
PROBLEM NO.: 8 ([Link] 9.27 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mrs. Jacob, an ordinary resident of India, received the following income as interest on investments in
securities during the year ended 31st March 2024.
Rs. 1,000 as interest on central Government Bonds.
Rs. 7,200 as interest on Debentures issued by a local authority.
Rs. 5,600 as interest on Debentures of ‘A’ Ltd. (unlisted)
Rs. 2,700 as interest on Debentures of ‘B’ ltd. (listed)
Rs.4,800 as interest on Tax Free Debentures of ‘C’ Ltd (Unlisted)
Determine Mrs. Jacobs interest on securities under the head ‘Income from other sources’ for the
Assessment year 2024-25.
SOLUTION NO: 8
Computation of Interest on debentures
Particulars Rs. Rs.
Interest on Central Government Securities 1,000
Interest on Debentures by local authority
(7,200X100/90) 8,000
Interest on debentures of A Ltd
(5,600X100/90) 6,222
Interest on debentures of B Ltd
(2,700X100/90) 3,000
Tax free debentures of C Ltd
(4,800X100/90) 5,333 23,555
Taxable interest 23,555

PROBLEM NO.: 9 ([Link] 2.436 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
Mr. Ankit received the following gifts during P/Y 2023-2024.
1. He Received a gift in cash of Rs. 20,000 from his uncle on 30-6-23
2. He Received a cheque of Rs. 30,000 as a gift from his elder brother on 10-11-23
3. He Received a gift Rs. 21,000 on his wedding from Mr. X on 1-12-23
4. He Received a gift of Rs. 51,000 from his brother in law on 31-1-24
5. He received Rs. 25,000 as gift from his nonresident friend Mr.Y 30-12-23
6. He received Rs. 5,000 from Mr.Z his resident fiend on 15-2-24
Calculate the amount of taxable gifts chargeable under the head other sources.
SOLUTION NO : 9
Calculation of taxable gifts chargeable under IFOS
Particulars Rs.
Cash gift from uncle on 30.6.2023 20,000
Gift from brother on 10.11.2023 Nil
Cash gift from Mr.X on wedding (1.12.23) Nil
Cash gift from non-resident friend 25,000
Cash gift from brother-in-law on 31.1.24 Nil
Cash gift from his resident friend 5,000
Total Monetary Gift 50,000
Hint: Since the aggregate amount of gift does not exceed Rs. 50,000, hence taxable gift value is NIL.
PROBLEM NO.: 10 ([Link] 9.62 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Calculate income from other sources from the following assuming all commercial securities are
unlisted securities.
Rs. 2,50,000 invested in 12% less- tax Government securities
Rs. 2,50,000 invested in 12% tax-free commercial securities
Rs. 2,50,000 invested in 12% less- tax commercial securities
Rs. 8,000 received as interest from less-tax commercial securities
SOLUTION NO : 10

4
 Calculation of IFOS
Particulars Rs.
Interest on Government securities
(2,50,000X12%) 30,000
Tax free commercial Securities
(2,50,000X12%X100/90) 33,333
Less tax commercial securities
(2,50,000X12%) 30,000
Interest received on less tax commercial securities
(8,000X100/90) 8,888
Total taxable Interest on securities 1,02,222

PROBLEM NO.: 11 ([Link] 9.52 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mr X has the following incomes during the year ending 31-3-2024
1. Dividend declared by M Co. on 31-3-2024 (Indian Co.) Rs. 6,000
2. Dividend declared by Z Co. on 31-3-2024 (Indian Co.) Rs.9,000
3. Interim dividend received on 1-5-2024 (Indian Co.) Rs. 3,000
4. He won gold worth Rs.10,00,000 from Punjab state lottery.
5. During March 2024 he earned Rs.1,00,000 as prize money on horse races. These horses are owned
by him and expenditure incurred on maintenance of these horses amounted to Rs.1,60,000.
Compute IFOS for the AY 2024-25.
SOLUTION NO: 11
Calculation of IFOS
Particulars Rs. Rs.
I. Dividend:
Declared by [Link]. Ltd 6,000
Declared by Z Co. Ltd 9,000
Interim dividend 3,000 18,000
II. Casual income:
Gold from Punjab State Lottery 10,00,000 10,00,000
III. Stake Money:
Prize money of horse race 1,00,000
Less: Expense on maintenance 1,60,000
Loss C/F to next four years (60,000) Nil
Income from other sources 10,18,000
PROBLEM NO.: 12 ([Link] 9.59 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Compute the income for the year ending 31.3.24 under the head ‘Income from other sources’ of
[Link]. His investments were: 5% Govt. securities Rs. 70,000
8% Agra Municipal bonds Rs. 50,000
9% Debentures of a company Rs. 30,000
7% Capital investment bonds Rs. 20,000

SOLUTION NO: 12
Compute the income for the year ending 31.3.24
Particulars Rs.
Government securities (70,000X5%) 3,500
Agra Municipal Bonds (50,000X8%) 4,000
Debentures of a Co. (30,000X9%) 2,700
Capital interest bond Exempted
Income from other Sources 10,200

PROBLEM NO.: 13 ([Link] 9.30 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Compute the income from other sources of Miss. Anu from the following details furnished:
5
  She holds Rs.50,000, 10% tax free Govt. securities.
 She received Rs.10,000, interest on Tamilnadu State Government securities.
 She holds 1,00,000, 10% Tax free debentures of P&R Co Ltd. (listed).
 Rs.12,000, interest was received by her on Tax free securities of a Ltd. Company.
 Rs. 60,000, 15% debentures are held by her in a Ltd Co.
 Rs.8,000 interest was received by her on securities of a Paper mill company. (listed).

SOLUTION NO: 13
Compute the income for the year ending 31.3.24
Particulars Rs.
Interest on Government Securities (50,000X10%) 5,000
Interest on TNSGS 10,000
Interest on tax free debentures (1,00,000X10%X100/90) 11,111
Interest on tax free securities (12,000X100/90) 13,333
Interest on debentures (60,000X15%) 9,000
Interest received (8,000X100/90) 8,888
Income from other sources 57,332

PROBLEM NO.: 14 ([Link] 2.448 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
The following investments are held by Genith on 1-4-2023.
Rs. 40,000, 10% UP Govt. loan; Rs. 35,000, 8 % Debentures of a Sugar mill Co. Saharanpur.
Rs. 50,000, 12% Debentures of Ugly trading co.
On 1-9-2023, he sold the debentures cum interest of Ugly Trading Co. and purchased Rs.60,000
15% debentures cum interest of Beauty Trading Co. Interest on investments is received half yearly on 1 st
July and 1st January every year. Calculate Income from securities for the P/Y 2023-2024.

SOLUTION NO: 14

Computation of Income from Securities

Particulars Rs.
Interest on UP Govt. loan (40,000X10%) 4,000
Interest on debentures (35,000X8%) 2,800
Interest on Ugly trading Co. (50,000X12%X1/2) 3,000
Interest on Beauty trading co. (60,000X15%X1/2) 4,500
Interest on Securities 14,300

PROBLEM NO.: 15 ([Link] 9.66 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
A Mrs. X gives you the following particulars in respect of her income for the financial year 2023-24
compute her income under the hand income from other source.
Interim dividend 4,000
Dividend from a company on equity shares 3,000
Dividend on preference shares 4,000
Director’s fees 1,800
Ground rent 3,000
Income from sub-letting 6,000
Dividend from foreign company (net) 5,000
Int. on National Defence Gold Bonds, 1980 3,000
Interest on saving bank deposit account with SBI, Salem Rs. 1,000
Income from agriculture in Africa Rs. 40,000
Dividend received in USA from an American company Rs. 12,000
Family pension received in Kenya for rendered service in India Rs. 54,000
SOLUTION NO: 15
Computation of Income from Other Sources
6
 Particulars Rs. Rs.
Interim Dividend 4,000
Dividend from a Co. equity Shares 3,000
Dividend on Preference Shares 4,000
Director Fees 1,800
Ground rent 3,000
Income from Sub letting 6,000
Dividend from a foreign Co. 5,000
Interest on National Defence bond Exempt
Interest on savings bank A/c 1,000
Income from agriculture (Africa) 40,000
Dividend from American Co. 12,000
Family Pension Acquired 54,000
Less: Standard deduction:
1/3 of Pension or 15,000 WEL 15,000 39,000
Ground rent 1,18,800

PROBLEM NO.: 16 ([Link] 9.53 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mr. Vasu gives you the following particulars in respect of his income for the financial year 2023-
2024. Compute his “Income from other sources” for the A/Y 2024-25
Interim dividend Gross Rs.3,000
Dividend from a company Gross Rs.4,000
Director fees Rs.18,000
Salary from his employer @ Rs.4,000 per month Rs.48,000
Rent received from Vacant land Rs.4,800
Income from subletting Rs.3,000
Interest on fixed Deposit with a company Rs.6,000 (Gross)
Cash Gift of Rs.40,000 is received from a friend on 1-11-23, on the occasion of wedding of vasu.
SOLUTION NO: 16

Computation of Income from Securities

Particulars Rs.
Interim dividend 3,000
Dividend from a Co. 4,000
Directors fees 18,000
Salary from a employer NA
Rent received from land 4,000
Income from sub letting 3,000
Interest on FD with a Co. 6,000
Gift on Occasion of wedding Exempt
Income from other sources 38,800

PROBLEM NO.: 17 ([Link] 2.460 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
Compute income from other sources of Mr. Krishna Moorthy who held the following investments:
1. Rs.11,000, 10% Central government securities
2. Rs.36,000, 10% Tax free commercial securities
3. Rs.6,300, received as interest on tax free public limited company securities (Listed)
4. Rs.7,200, received interest on Karnataka Government securities.
5. Rs.3,600, received as interest on Deepak fertilizers. (Listed)
6. Rs.30,000, 13.5 % securities of a paper mill Co limited (Listed)
7. Rs.35,000, 11% securities of a paper mill Co (Listed)
8. Rs.10,000, 15% Jaipur municipal corporation bonds
9. Dividend from Carona Ltd Rs. 4,000
7
 During the year he also got a prize in Karnataka state lottery. The net amount received by him was Rs.
35,000, interest on all securities is payable on 1st Jan every year. Bank charges Rs. 200 as collection charges.
SOLUTION NO: 17

Computation of Income from Other Sources

Particulars Rs. Rs.
Central Government Securities (11,000X10%) 1,100
Interest on tax free (36,000X10/100X100/90) 4,000
Interest received on tax free (6,300X100/90) 7,000
Interest received on Karnataka Government Securities 7,200
Interest on Deepak fertilizers (3,600X100/90) 4,000
Interest on paper Mill Co. Ltd. (30,000X13.5%) 4,050
Interest on paper mill co. (35,000X11%) 3,850
Interest on Jaipur bond (10,000X15%) 1,500
Dividend from Carona Ltd 4,000
Lottery received (35,000X100/70) 50,000
86,700
Less: Collection Charges 200 200
Income from Other Sources 86,500

PROBLEM NO.: 18 ([Link] 9.32 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
[Link] furnishes the following particulars of his income for the previous year 2023-2024.
Sri. Mukunda purchases Diamonds for Rs. 8 Lakh (Fair market value: Rs.8.5 lakh) he further purchases
an art work for Rs.9 lakh (Fair Market value Rs. 9.5 lakh)
1. Dividend on Equity shares (Gross) (Indian company) Rs. 600
2. Dividend on preference shares (Indian company) Rs. 5,000
3. Income from letting on hire of building and Machinery – Composite lease Rs. 17,000
4. Interest on bank deposits Rs. 2,500
5. Directors sitting fees Rs. 1,200
6. Ground rent Rs. 600
7. Income from undisclosed sources Rs. 10,000
8. Income from lotteries Rs. 10,000
9. Mukunda owned a land at Chennai. It was acquired by the government in 2016 – 17. Along with
compensation Rs.1,40,000 is payable by Govt. for late payment of compensation. The interest is
received during 2023 – 24.
The following deductions are claimed by him:
a) Collection charges of dividend Rs.20
b) Allowable depreciation on Buildings and machinery Rs.4,000
c) Insurance on building and machinery Rs.100
SOLUTION NO: 18

Computation of Income from Other Sources

Particulars Rs. Rs.
Dividend on equity shares 600
Dividend on preference shares 5,000
Income from letting on hire of building and machinery 17,000
Less: Depreciation on building and machinery 4,000
Insurance on building and machinery 100 12,900
Income from lottery 10,000
Interest on bank deposits 2,500
Director’s sitting fees 1,200
Ground rent 600
Income from undisclosed sources 10,000

8
 Diamond purchased value exceeding Rs.50,000 1,00,000
(Aggregate fair market value – Value of movable properties)
( 8.5 lakh + 9.5 Lakh - 8 + 9 Lakh )
Interest on late payment of compensation 1,40,000
Less:Deduction u/s 57(iv) (50% of interest) 70,000 70,000
Total income from other sources 2,12,800

PROBLEM NO.: 19 ([Link] 9.35 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
From the following particulars of Mr. Edward for the previous year ended 31st March 2023, Compute
his income U/H other sources for the A/Y 2024-2025, He received
Directors fee from a company 10,000 Interest on bank deposits 3,000
Income from undisclosed sources 12,000 Winning from lotteries (net) 82,200
Royalty on a book written by him 8,000 By giving lectures in functions 5,000
Interest on loan given to a relative 7,000 Interest on post office saving bank a/c 500
Interest on tax free debentures of a company Interest on government securities 2,200
(listed in recognized stock exchange) (Net) 3,600 Dividend on shares 6,400
He paid 100 for collection of dividend and 1,000 for typing the manuscript of book written by him.
SOLUTION NO: 19
Computation of Income from Other Sources
Particulars Rs. Rs.
I. Interest Income:
Interest on bank deposit 3,000
Interest on loan 7,000
Interest on Govt. Securities 2,200
Interest on tax free debentures 4,000 16,200
(3,600X100/90)
Interest on post office SB a/c 500
(Exempted upto 3,500) 500 Nil
II. Casual Income:
Winnings from lotteries 1,17,429
(82,200X100/70)
III. Other Income:
Directors fees of a company 10,000
Income from undisclosed source 12,000
Income from lectures 5,000 27,000
IV. Royalty Income:
Royalty on books 8,000
Less: Expenses on typing 1,000 7,000
Dividend on shares 6,400
Less: Collection charges 100 6,300
Income from Other Sources 1,73,929

PROBLEM NO.: 20 ([Link] 2.454 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
Rohit Arora furnishes the following particulars of his income for the financial year.
1. Dividend received from UTI Rs.10,000; Net amount received as winning from horse race Rs.21,000
2. Winning from camel race (Net) Rs.15,000
3. Winning from lottery (Net) Rs.70,000. Cost of lottery ticket was Rs.500. Commission paid to lottery
seller Rs.1,000 out of prize money.
4. Income tax refund Rs.10,000 (related to past year); Interest on income tax refund Rs.1,000
5. Amount won from T.V. Programme “Kaun Benga Crorepati” Rs.2,00,000.
6. Interest on 8% Tax free Relief Bonds issued by RBI Rs.5,000
9
 7. On 1-10-2022, he purchased 1000, 8% debentures of Rs.100 each of pearl Ltd. The date of interest
payment are June 30 and December 31 every year.
8. On 1-10-2022, he subscribed for 1,000, 10% debentures of Rs.100 each of pearl Ltd. The date of
interest payment is March 31, every year.
9. Interest received on Punjab Government Loan, Rs. 20,000.
10. Interest received on 8% debentures of Phymox Ltd. (Unlisted Company) Rs. 4,500
11. Gift from father Rs. 50,000
12. Family pension received Rs. 48,000
13. He lives in a rented house paying rent @ 10,000 p.m. he has sub let 1/3 portion of the house on a
rent of Rs. 4,500 p.m. the municipal tax Rs. 6,000 and repairs of whole house Rs. 2,700 have been
borne by him. Calculate income under head other sources for financial year 2024-2025.
SOLUTION NO: 20
Computation of Income from Other Sources
Particulars Rs. Rs.
Dividend from UTI 10,000
Winnings from horse race 30,000
(21,000X100/70)
Winnings from Camel race 15,000
Winnings from Lottery 1,00,000
(70,000X100/70)
Interest on income tax refund 1,000
Winnings from TV Show 2,00,000
Interest on tax free relief bond of RBI Exempt
Interest on 8% Debentures (6 Months) 4,000
Interest on 10% Debentures 10,000
Interest on Punjab Govt. Loan 20,000
Interest on Debentures 5,000
(4500X100/90)
Gift from father Exempt
Family pension 48,000
Less: Standard deduction 15,000
1/3 of 48,000 (Or) 33,000
15,000 WEL
Income from sub letting:
Rent received 54,000
Less: Expenses
Municipal Tax (6,000X1/3) 2,000
Repairs (2,700X1/3) 900
Rent paid (1,20,000X1/3) 40,000 42,900 11,100
Income from Other Sources 4,39,100

PROBLEM NO.: 21 ([Link] 9.51 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mr. Senthil furnished the following income during 2023-2024. Compute taxable income under ‘Other
Sources’
Particulars Rs.
Winnings from Tamilnadu State Lottery 1,80,000
Winnings from horse races (Amount won) 1,500
Winnings from Cross word puzzle 15,000
Winnings from card games 20,000
Winnings from gambling and betting 25,000
Loss from card games 10,000
Expenses on buying lottery tickets 500
SOLUTION NO: 21
10
 Computation of Income from Other Sources
Particulars Rs. Rs.
Casual Income:
Winnings from Tamilnadu State Lottery 1,80,000
Winnings from cross word puzzle 15,000
Winnings from card games 20,000
Winnings from gambling and betting 25,000 2,40,000
Race Winnings:
Winnings from horse race 1,500 1,500
Taxable income under IFOS 2,41,500

PROBLEM NO.: 22 ([Link] 9.51 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
From the following particulars, compute the income from other sources for the A.Y. 24-25.
Particulars Rs.
Winnings from horse race 10,000
Winnings from Lottery tickets 50,000
Amount spent on lottry tickets 5,000
Dividend received (Net) TDS 10% 81,000

SOLUTION NO: 22
Computation of Income from Other Sources
Particulars Rs. Rs.
a. Winnings from horse race 10,000
b. Winnings from lottery tickets 50,000
c. Dividend received 90,000
(81,000X100/90)
Income from Other Sources 1,50,000

PROBLEM NO.: 23 ([Link] 9.54 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
The following incomes are received by Miss. C during the assessment year 2024-25. Compute taxable
income.
Particulars Rs.
Royalty on books (Expenses for the above books Rs. 30,000
5,000)
Interest on post office saving bank 1,500
Cross word puzzle prizes 2,500
SOLUTION NO: 23
Computation of Taxable Income
Particulars Rs. Rs.
a. Royalty on books 30,000
Less: Expenses on the books 5,000 25,000
b. Interest on Post office SB a/c 1,500
Less: Exemption (upto 3,500) 1,500 Nil
c. Cross word puzzle prices 2,500
Taxable Income. 27,500
PROBLEM No.: 24 ([Link] 9.55 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
From the following details, compute income from other sources for the year 2023-2024.
i) Dividend Rs. 12,000
ii) Rent from machineries Rs. 26,000 (bank collection charges Rs.380; insurance premium Rs.
1,060; depreciation Rs. 1,400; repair expenses Rs.250)
iii) Casual income (Net) Rs.24,500
iv) Interest on bank deposit Rs. 6,000
v) Royalty income Rs. 18,000 (expenses Rs.2,000)

11
SOLUTION NO: 24
Computation of Taxable Income
Particulars Rs. Rs.
(i) Dividend 12,000
(ii) Rent from machineries 26,000
Less: Expenses
Collection Chares 380
Insurance 1,060
Depreciation 1,400
Repairs 250 3,090 22,910
(iii) Casual income 35,000
(24,500X100/70)
(iv) Interest on bank deposit 6,000
(v) Royalty income 18,000
Less: Expenses 2,000 16,000
Income from other sources 91,910

PROBLEM NO.: 25 ([Link] 2.468 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
From the following information compute the total income from other sources for the assessment year 24– 25:
i. Card games loss Rs. 12,000
ii. From the activity of owning and maintaining horses from race purposes
(a) Loss at Bombay Rs. 40,000
(b) Profit at Bangalore Rs. 20,000
iii. Dividend (Gross) from Indian companies Rs. 6,000
iv. Betting in horse races Rs. 4,000

SOLUTION NO: 25
Computation of income from IFOS
Particulars Rs. Rs.
Casual loss NA
Dividend from Indian Company 6,000
Betting from horse race 4,000
Stake Money from horse race:
Profit from Bangalore 20,000
(-) Loss from Bombay (40,000)
Loss C/f to next four years (20,000) -
Income from other sources 10,000

PROBLEM NO.: 26 ([Link] 2.469 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
From the following particulars of Mr. Senthil for the previous year ended 31st March 2024, compute his
income U/H Other Sources for the A/Y 2024-25. He received the following
 Directors fee from a company Rs.10,000;
 Interest on bank deposits Rs.3,000;
 Income from undisclosed sources Rs.12,000;
 Winning from lotteries (net) Rs.24,500;
 Royalty on a book written by him Rs.8,000;
 By giving lectures in function Rs.5,000;
 Interest on loan given to a relative Rs.7,000
 Interest on tax free debentures of a company (listed in recognized stock exchange) (Net) Rs.3,600;
 Dividend on shares Rs.6,400; Interest on post office saving bank a/c Rs.500; Interest on government
securities Rs.. 2,200
 He paid Rs.100 for collection of dividend and Rs.1,000 for typing the manuscript of book written by
him.
12
SOLUTION NO: 26
Computation of Income from Other Sources
Particulars Rs. Rs.
I. Interest Income:
Interest on bank deposit 3,000
Interest on loan 7,000
Interest on Govt. Securities 2,200
Interest on tax free debentures 4,000 16,200
(3,600X100/90)
Interest on post office SB A/c 500
(Exempted upto 3,500) 500 NIL
II. Casual Income:
Winnings from lotteries 35,000
(24,500X100/70)
III. Other Income:
Directors fees of a company 10,000
Income from undisclosed source 12,000
Income from lectures 5,000 27,000
IV. Royalty Income:
Royalty on books 8,000
Less: Expenses on typing 1,000 7,000
6,300
Dividend on shares

Income from Other Sources 92,200

PROBLEM NO.: 27 ([Link] 2.462 Income Tax Law & Practice, V.P. Gaur & D.B. Narang)
[Link] furnishes the following particulars of his income for the previous year 2023-2024. Compute
his total income.
i) Dividend on Equity shares (Gross) (Indian company) Rs. 600
ii) Dividend on preference shares (Indian company) Rs. 3,200
iii) Income from letting on hire of building and Machinery – Composite lease Rs. 17,000
iv) Interest on bank deposits Rs. 2,500
v) Directors sitting fees Rs. 1,200; Ground rent Rs. 600
vi) Income from undisclosed sources Rs. 10,000 (Unexplained expenditure)
vii) Income from lotteries Rs. 10,000 (Gross)
The following deductions are claimed by him:
a) Collection charges of dividend Rs. 20; Allowable depreciation on buildings and machinery Rs. 4,000
b) Fire insurance on buildings and machinery Rs.100
SOLUTION NO: 27
Computation of Income from Other Sources
Particulars Rs. Rs.
Dividend on equity shares 600
Dividend on preference shares 3,200
Income from letting on hire of building and machinery 17,000
Less: Depreciation on building and machinery 4,000
Insurance on building and machinery 100 12,900
Income from lottery 10,000
Interest on bank deposits 2,500
Director’s sitting fees 1,200
Ground rent 600
Income from undisclosed sources 10,000

13
 Total income from other sources 41,000

PROBLEM NO: 28 ([Link] 9.73 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
The following income were received by Mr.'A' during the financial year 2023-24.
Director's fees Rs. 6,000
Income from agricultural land in pakistan Rs. 40,000
Interest from post office saving bank account Rs. 1,500
Interest on Fixed deposit in SBI RS. 1,800
Winning from Lottery (Net) Rs. 21,56,000
Cash (gift ) received from Mr.'A's father Rs. 20,00,000
Cash (gift ) received from Mr.'A's friend Rs.23,000
Cash (gift) received from another friend of Mr.A RS. 22,000
Winning From Crossword puzzle Rs.2,500
Royalty on books Rs. 20,000
Expenses for writing books Rs.4,000
Another sum of cash (gift) of Rs.25,000 from ma friends is received by by Mr. A from his friend . On 11-10-23.
Another cash (gift ) amount of Rs.26,000 is received by Mr.A from his friends on 28-10-23.
Compute Mr. 'A' S Income From Other Sources.
Mr. A purchase a land for Rs.25 lakh (stamp duty value 25.5 lakh)
Mr. A purchase house for Rs. 6,00,000 (stamp duty value Rs. 7,00,000)

SOLUTION NO: 28
Particulars Rs. Rs.
Director's fees 6,000
Income from agricultural land in pakistan 40,000
Interest from post office saving bank account Exempt
(Exempted upto Rs.3,500)
Interest on Fixed deposit in SBI 1,800
Winning from Lottery (Net) (21,56,000 x 100 / 70)
Cash (gift )
Received from Mr.'A's father (Relatives) Exempt
Received from Mr.'A's friend 23,000
Received from another friend of Mr.A 22,000
Another cash gift Received from friend of Mr.A on 11.10.23 25,000
Another cash gift Received from friend of Mr.A on 28.10.23 26,000 96,000
Winning From Crossword puzzle 2,500
Royalty on books 20,000
Less: Expenses 4,000 16,000
Mr. A purchase a land (25,50,000 – 25,00,000)
(Land with stamp duty value not exceeding Rs.50,000 Exempt
Mr.A Purchase a house (7,00,000 – 6,00,000)
(House purchased, stamp duty exceeding Rs.50,000) 1,00,000
Total income from other sources 3,42,300
Note:
1. Gifts received form a person/persons exceeding in aggregate of Rs.50,000 is taxable
2. Gift received from relatives is not taxable.
3. In the case of land purchased nothing is table when stamp duty value does not exceed Rs.50,000 and
when stamp duty value exceeds Rs.50,000 the difference is taxable.
PROBLEM NO: 29 ([Link] 9.21 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
14
 Mrs. Arun and varun received the following dividends from different Indian companies during 2023 – 24.
Particulars Arun Varun
Dividends from:
A Ltd 8,00,000 2,50,000
B Ltd 20,00,000 3,50,000
C Ltd 28,00,000 4,00,000
Interest on capital borrowed for earning dividends 21,000 2,50,000
Other income 2,00,000 8,00,000
Deductions U/S 80C to 80U 2,20,000 1,50,000
Compute the income from other sources.
SOLUTION NO: 29
Computation of Income from Other Sources of Arun
Particulars Rs. Rs.
Dividends from Indian companies:
A Ltd 8,00,000
B Ltd 20,00,000
C Ltd 28,00,000
56,00,000
Less: Deduction of interest on capital
borrowed for investment not exceeding 21,000
20% of dividend ( 56,00,000 x 20%)
11,20,000 or 21,000 (WEL)
55,79,000
Other Income 2,00,000
Total income from other sources 57,79,000

Computation of Income from Other Sources of Varun

Particulars Rs. Rs.
Dividends from Indian companies:
A Ltd 2,50,000
B Ltd 3,50,000
C Ltd 4,00,000 10,00,000
Less: Deduction :
Interest on borrowings for investment:
Actual: 2,50,000 20% of 10,00,000 = Rs.2,00,000 2,00,000
8,00,000
Other Income 8,00,000
Total income from other sources 16,00,000

Note: Dividends from Indian companies are taxable. (Expenses are deductible in the form of interest on
borrowings on capital for Investment in shares being least of actual interest or 20% of dividend).
PROBLEM NO: 30 ([Link] 9.52 Income Tax Law & Practice, [Link] &[Link] Prasad Reddy)
Mr.G Bedi owns houses at Bangalore and Delhi. The horses run in races at the race courses in those
cities. For the year 2023-2024 Mr. Bedi submits the following details. Compute IFOS.
Particulars Amount
1. Expenses on horses at Bangalore 2,60,000
2. Expenses on horses at Delhi 4,30,000
3. Stake money received by horses at
Bangalore 1,20,000
Delhi 5,00,000
4. Mr. Bedi received Rs. 1,03,650 on 01.07.23 on betting during horse
races at Bombay. Compute his taxable income under other sources.

15
Solution:
Calculation of IFOS of Mr. Kannan for the previous year 2022-23
Particulars Rs. Rs.
I. Income from maintenance of horse:
Stake money earned at Bangalore 5,00,000
Stake money earned at Bombay 1,20,000 6,20,000
Less: Expenses:
At Bangalore 4,30,000
At Bombay 2,60,000 6,90,000
Loss from maintenance of horse c/f to 4 years (70,000)
II. Casual Income:
Income from betting on horses:
Net received (1,03,650X100/70) 1,48,071
Income from other sources 1,48,071

UNIT – II COMPLETED
*****************************************************************************

ADDITIONAL PROBLEM
PROBLEM NO : 1([Link] 10.13 Income Tax Law & Practice, Dr. T. Srinivasan)
GG king furnishes the following particulars for his income for the P.Y 23-24. Compute IFOS for the A.Y
2024-25
[Link] PARTICULARS Rs
i. Dividend gross from Ashok Leyland Ltd 25000
ii. Dividend from cooperative society 5000
iii. Interim Dividend from Rane (Chennai) 6000
iv. Dividend from foreign company 26000
v. Dividend from mutual fund 3000
SOLUTION:
Computation of Income from other sources
Particulars Rs.
Dividend gross from Ashok Leyland Ltd 25000
Dividend from cooperative society 5000
Interim Dividend from Rane (Chennai) 6000
Dividend from foreign company 26000
Dividend from mutual fund 3000
Dividend gross from Ashok Leyland Ltd 25000
Dividend from cooperative society 5000
Income from other sources 65,000

PROBLEM NO : 2([Link] 10.17 Income Tax Law & Practice, Dr. T. Srinivasan)
Mr. Kamalnath received the following income during the P.Y 23-24. Compute his taxable IFOS
[Link] PARTICULARS Rs
i. Directors sitting fess 7500
ii. Rent from sub- letting a house 15000
iii. Rent payable to the house owner for the sub-let house 5000
iv. Income from examinership 6000
v. Ground rent 4000
SOLUTION:
Computation of Income from other sources
Particulars Rs. Rs

16
 Directors sitting fees 7,500
Rent from sub letting a house 15,000
Less: Rent payable to the house owner 5,000
10,000
Income from examinership 6,000
Ground rent 4,000
Taxable Income from other sources 27,500

PROBLEM NO : 3([Link] 10.20 Income Tax Law & Practice, Dr. T. Srinivasan)
Given below are the investment of Ms. Mithra made during the P.Y
[Link] PARTICULARS Rs
i. 10% U.P Government loans 50000
ii. Tax free 10% debentures of BPL Ltd 45000
iii. 9% Preference shares of ABC Ltd. Chennai 30000
iv. 9% National Relief certificates 5000
v. 10% less tax commercial securities of Abi Ltd 100000
SOLUTION:
Computation of Income from other sources
Particulars Rs
Interest on U.P Government loan 5,000
Tax free debentures of BPL Ltd (4,500x100/90 5,000
Dividend on preference shares of ABC Ltd 2,700
Interest on less tax commercial securities of Abi Ltd 10,000
Income from other sources 22,700
Note :Interest from National Relief certificate is exempted

PROBLEM NO : 4 ([Link] 10.18 Income Tax Law & Practice, Dr. T. Srinivasan)
Mr. Ragunath received the following income during te P.Y 23-24. Compute the taxable IFOS

[Link] PARTICULARS Rs
i. Family pension received 30000
ii. Royalty amount received 15000
iii. Honorarium received for delivering lectures 3000
iv. Director's fee 5000
v. Expenses incurred to earn policy 2000
SOLUTION:
Computation of Income from other sources
Particulars Rs. Rs
Family pension received 30,000
Less: 1/3 of Family pension 10,000/Rs. 15,000 WEL 10,000
20,000
Royalty amount received 15,000
Less: Expenses for royalty 2,000
13,000
Honorarium received for delivering lectures 3,000
Director's fees 5,000
Taxable Income from other sources 41,000

PROBLEM NO : 5 ([Link] 10.24 Income Tax Law & Practice, Dr. T. Srinivasan)
Mr. Anbu received the following income during te P.Y 23-24. Compute the taxable IFOS

17
 [Link] PARTICULARS Rs
i. Director's fees 2000
ii. Income from agricultural land in Srilanka 5000
iii. Ground rent for land in Mysore 10000
iv. Interest on post office saving bank account 100
v. Interest on posits with IFCI 500
vi. Dividend from foreign company 700
vii. Rent from sub- letting a house 26250
viii. Rent paid by Anbu ( on the sub let house) 13000
ix. Winning from horse race 12300
x. Interest on securities 4000
SOLUTION:
Computation of Income from other sources
Particulars Rs. Rs
Director's fees 2000
Income from agricultural land in Srilanka 5000
Ground rent for land in Mysore 10000
Interest on securities 4000
Interest on posits with IFCI 500
Interest on post office saving bank account 100
Dividend from foreign company 700
Winning from horse race 12300

Rent from sub- letting a house 26250

Rent paid by Anbu ( on the sub let house) 13000
13,250
Income from other sources 47,750

18