Question

P (51 years) is in the service of A Ltd. since 1980. He dies on January 31, 2020. The following information is available:

Basic Salary: Rs. 40,000 per month; dearness allowance: Rs. 12,000 per month (40% of which is included for the purpose of determining retirement benefit); transport allowance: Rs. 7,600 per month (out of which only Rs. 600 is used for the journey between office and residence; the remaining amount is not spent); and entertainment allowance: Rs. 2,000 per month. He contributes 15% of basic salary towards recognised provident fund and A Ltd. also makes a matching contribution. Interest is credited at the rate of 9.5% on April 28, 2019.

After the death of P, his legal heir (Mrs. P) gets the following payments from A Ltd.:

1. Salary for the month of January, 2020

2. Family Pension: Rs. 20,000 per month

3. Encashment of leave standing to the credit of P on January 31, 2020: Rs. 2,40,000 (as per service rules P is entitled for 45 days leave for each year of service)

4. Provident fund balance: Rs. 3,90,000

5. Gratuity: Rs. 2,60,000 (P is not covered by the Payment of Gratuity Act, 1972, nor is there any agreement with employer to receive gratuity)

P was a doctor. He used to run a small clinic near his residence which was discontinued after the death of P. His income from the clinic for the period April 1, 2019 to January 31, 2020 was Rs. 79,000.

After the discontinuation of the clinic, Mrs. P recovered some of the outstanding bills issued by P (amount recovered during February 1, 2020 to March 31, 2020: Rs. 3,76,000). Mrs. P does not have any other income. On March 30, 2020, Mrs. P withdrew Rs. 5,40,000 being the balance in account of P in National Savings Scheme, 1987.

Assuming that salary, allowances and pension become “due” on the last day of the month, find out-

a. Who will be chargeable to tax in respect of the aforesaid receipts?

b. Net income and Tax Liability for the assessment year 2020-21.

Answer 1

Answer:

For professionals, Government has introduced a new scheme of presumptive taxation (Section 44ADA), under which professionals can file their return declaring 50% of their gross receipts (which must be up to ₹50 lakhs) as income, and after deducting section 80 deductions, professionals need to pay tax on balance total ...

Answer 2

Answer:

A black hole is a region of spacetime where gravity is so strong that nothing—no particles or even electromagnetic radiation such as light—can escape from it. The theory of general relativity predicts that a sufficiently compact mass can deform spacetime to form a black hole.