BL&T

Summer Exam-2013(Intermediate)

Business Laws & Taxation (02-05-2013)

Duration: 3 hrs. M a r k s - 1 0 0[Instructions]

Ensure that the question paper delivered to you is the same, in which you intend to appear. Read the instructions given on the title page of Answer Script. Use separate Answer Script for Taxation Paper. Start each question from fresh page.

Attempt all Questions

Business Laws (70 Marks)Q.1. a) What is the meaning of Law? (03)

b) Define the Term Legislation. (03)

c) Explain the Historical Source of Law. (04)

Q.2. a) Define the following terms as per Contract Act, 1872:

(i) Unilateral Contract

(ii) Bilateral Contract

(02)

b) Differentiate between the Term Coercion and Undue Influence. (04)

c) Differentiate between a Contract and Quasi Contract. (04)

Q.3. a) ABC & Co. (seller) agrees to sell 500 tons of cotton to Din Weaving Mills Ltd (buyer)on September 30, 2012. What remedies are available to the seller in the following twocircumstances?

(i) Seller delivered the goods as per agreed terms but the buyer breached the contractand failed to make payment of the goods.

(03)

(ii) Seller is ready and willing to deliver the goods and requests the buyer to take thedelivery but the buyer refuses to accept the delivery without any reason.

(02)

b) “XYZ Brothers” is a partnership firm. Mr. X retires and his cousin Mr. B agrees to takeover the liabilities of Mr. X and become the new partner of the firm. Mr. D an oldcreditor of the firm disagrees with the arrangement and sues Mr. X for the recovery ofthe debt.

Can Mr. D recover his debt from Mr. X?

(03)

Q.4. a) Briefly explain the various modes in which a partnership may be dissolved. (10)

b) What are the essentials of Endorsement? (03)

Q.5. a) Define following terms as per Companies Ordinance 1984:

(i) Memorandum of Association

(ii) Articles of Association

(06)

b) Every company is required to maintain statutory books or registers under theCompanies Ordinance, 1984. Give the names of any six statutory books or registers.

(06)

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Q.6. a) What do you mean by the term “Special Resolution” as per Companies Ordinance,1984?

(04)

b) Board of Directors of M&N Co. has informed the CFO that they want to change theobjects of the company.You being the CFO of the company explain the provision relating to:

(i) The change of object clause of the company and

(ii) Procedure to hold Extra Ordinary General Meeting to the Board of Directors.

(06)

Q.7. Distinguish between Partnership and a Company. (07)

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3

Taxation (30 Marks)Use separate Answer Script for this Paper

Q.1. Define the following terms under Sales Tax Act 1990:(i) Person (04)

(ii) Output Tax (05)

Q.2. Distinguish between “Zero Rated Supplies” and “Exempt Supplies” on following basis: (06)(i) Taxability Status(ii) Credit / Adjustment of Input Tax(iii) Maintenance of record under Sales Tax Act(iv) Filling of return under Sales Tax Act

Q.3. Define following terms under Income Tax Ordinance, 2001

(i) Income (02)

(ii) Business (02)

(iii) Public Company (04)

Q.4. Mr. Z rented his house to Mr. X at a monthly rent of 30,000/-. Mr. X paid an amount of Rs.90,000 as security deposit (non-adjustable against rent). Mr. X also agreed to pay annualproperty tax of Rs. 60,000 and rent of furniture and fixture amounting to Rs. 5,000 per month.

(07)

Required:

Calculate Income from property and total taxable income of Mr. Z in following two differentscenarios:

(i) Where fair market rent (FMR), without furniture and fixture, is Rs. 25,000 per month.

(ii) Where fair market rent (FMR), without furniture and fixture is Rs. 35,000 per month.

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Winter Exam-2012

(Intermediate)


Duration: 3 hrs. M a r k s - 1 0 0

[Instructions]

• Ensure that the question paper delivered to you is the same, in which you intend to appear.

• Read the instructions given on the title page of Answer Script.

• Use separate Answer Script for Taxation Paper.


Business Laws (70 Marks)

Q.1. a) Explain the Implied Authority of a Partner in reference with the Partnership Act 1932? (03)

b) A, B and C are partners in a firm ABC. C retires from the partnership, and all the assets and liabilities are taken over by the two partners, A & B who carry on the firm after the retirement of C.

A creditor of the firm before the retirement of C files a suit against A, B and C for the recovery of his debt after the retirement of C. Explain that C is liable or not?

(03)

c) A firm consisted of four partners A, B, C and D. A died leaving a minor son X. B sold his share in the firm to Y. The remaining partners thereupon continued the firm as they were entitled to do. What are the rights of X and Y? Can they insist on being admitted as partners?

(03)

Q.2. Define Extra Ordinary General Meetings? What are requirements / procedures for calling Extra Ordinary General Meetings?

(12)

Q.3. Define the terms “Articles” and “Private Company” with reference to Companies Ordinance 1984.

(06)

Q.4. a) Define the term “Negotiation” in reference with Negotiable Instrument Act, 1881. (03)

b) What are the essentials of endorsement? (06)

Q.5. a) What are essentials of a Contingent Contract? (05)

b) ABC contractors agreed to construct factory building of Sitara Mills Limited at a cost of Rupees 90 million. However, it was agreed that payment would only be made on completion of the project. Is this a contingent contract under the Contract Act, 1872?

(03)

Q.6. a) B agreed to purchase an animal from A for a consideration of Rs. 5,000. B requested to A to keep the animal for a week. The animal died during the week. Explain who will bear this loss?

(03)

b) M agreed to deliver 500 kg of goods to N on agreed price but he delivered 650 kg of goods to N. In light of provisions of Sales of Goods Act, 1930 what N should do?

(03)

Q.7. Explain Public Law and Private Law? (10)

Q.8. Give 5 different scenarios when a company can alter its object clause of Memorandum? (10)

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Taxation (30 Marks)

Use separate Answer Script for this Paper

Q.1. Define the following terms with reference to Income Tax Ordinance, 2001.

(i) Business (03)

(ii) Fee for technical services (03)

Q.2. Discuss the following income as Pakistan Source of Income with reference to Income Tax Ordinance, 2001.

(09)

(i) Salary

(ii) Business income of non-resident

(iii) Dividend

(iv) Profit on debt

Q.3. Explain the term “Taxable Activity” with reference to Sales Tax Act 1990. (08)

Q.4. A Sales Tax registered manufacturing company has the following transactions during the month of August 2012.

Rs. (000)

Exports 11,000

Local Purchases 10,000

Imports 4,000

Local supplies 10,000

Other information:

• Local purchases includes 40% from registered retailers and 20% were from non-registered persons and balance from registered manufacturers.

• Local supplies comprise 20% supplies to non-registered persons and 80% to registered persons.

Required:

Calculate Sales Tax Liability for the month of August, 2012

(07)

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Summer Exam-2012 (Intermediate)



[Instructions]


• Read the instructions given on the title page of Answer Script.

• Use separate Answer Script for Taxation Paper.



Q.1. a) Explain the term Legislation. (05)

b) List the legal sources. (08)

Q.2. A and B entered into a Partnership and according to Partnership deed they can carry on

business for 5 years or so long as C does not come back from England.

Why this is not a Partnership at WILL?

(05)

Q.3. What are the main clauses (contents) of Memorandum of a Company limited by shares? (08)

Q.4. Babar, Basit and Barkat want to register a Partnership firm “BBB Traders”. Advise them

procedure of registration of firm as given in Partnership Act 1932.

(12)

Q.5. List three kinds of negotiable instruments. (05)

Q.6. Explain in the following scenarios whether Party A has committed fraud with Party B or

not.

i) Mr. A sold a car by Auction to Mr. B which was damaged in an accident and repaired

by Mr. A. Mr. A did not disclose this fact to Mr. B

ii) Mr. A’s car was damaged in an accident and repaired by him. Mr. B purchased car

from Mr. A on a condition that major repair was not carried out in Past. Mr. A said

nothing.

(05)

Q.7. Diamonds Chemical (Pvt.) Limited was incorporated on 1st

April 2010. Its total members are

10 with equal voting power. When the company should hold “Statutory Meeting” and

“Annual General Meeting”? How many members must be in AGM to fulfill Quorum

requirements?

(10)

Q.8. Differentiate between a Public listed company and a Public unlisted company on the

following basis

i) Minimum number of Directors

ii) Minimum number of Members

iii) Quorum for a General Meeting

iv) Notice for AGM

v) Framework for Preparation of Accounts

vi) Subscription from public

(12)

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Taxation (30 Marks)

Use separate Answer Script for this Paper

Q.1. Define the following terms under Income Tax Ordinance

(i) Total income (02)

(ii) Heads of income (02)

(iii) Company (05)

Q.2. Explain with example the terms “Tax year” and “Special Tax year” under the Income Tax

Ordinance.

(06)

Q.3. Explain the term “Manufacture” and “Manufacturer” under the Sales Tax Act. (07)

Q.4. Calculate Sales Tax Liability of ABC Limited from following information:

[ Rs.

Purchases from registered person 9,000,000

Purchases from non-registered person 1,000,000

Import of Goods 12,000,000

Sales to registered person 15,000,000

Sales to non registered person 5,000,000

Sales of exempt goods 5,000,000

Manufacturing and other cost 500,000

(08)

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Winter Exam-2011

(Intermediate) Business Laws & Taxation (03-11-2011)

Duration: 3 hrs. Ma r k s ‐ 1 0 0 [Instructions]

• Ensure that the question paper delivered to you is the same, in which you intend to appear. • Read the instructions given on the title page of Answer Copy. • Use separate Answer Copy for Taxation paper.


Business Laws (70 Marks) Q.1. What are different sources of Law in Pakistan? (10)

Q.2. Define an offer and an acceptance with one example of each. (05)

Q.3. Define the following in reference to Sale of Goods Act, 1930;

(i) Existing Goods

(ii) Future Goods

(05)

Q.4. What are essentials of a valid Partnership? (10)

Q.5. What are the essential conditions of a valid Bill of Exchange? (05)

Q.6. What is an AGM and EGM according to the Companies Ordinance, 1984? (10)

Q.7. ‘X’ offered to sell his car to ‘Y’ for Rs. 300,000 cash payable at once. ‘Y’ accepted the offer for Rs. 300,000 cash but payable in a week.

Is there a valid contract between ‘X’ & ‘Y’?

(05)

Q.8. Differentiate between a Private and Public Limited Company. (10)

Q.9. ‘X’ agrees to ‘Y’, a thief, to stop prosecution against him if ‘Y’ restores his stolen cash and items.

Is this a Valid Contract?

(05)

Q.10. ‘X’, a driver of a bus, requested a passenger to drive the bus to its destination. He drove the bus negligently and injured ‘Z’. Is the owner of the bus liable for damages to ‘Z’?

(05)

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Taxation (30 Marks)

Q.1. (a) With reference to Sales Tax Act & Finance Act, 2011 discuss the following

(i) Impact of change of sales tax rate on commercial importer (02)

(ii) Claim of input tax on fixed assets (02)

(iii) Discuss tax fraction (02)

(b) Define the following: (i) Retail price (01)

(ii) Taxable goods (01)

Q.2. On 15th March, 2011 through Income Tax Amendment Ordinance 2011 section 4(a) was added enforcing surcharge @ 15% on income tax, discuss its;

(i) Application on deduction at source (03)

(ii) Current status after 30‐06‐2011 (03)

Q.3. KYG Ltd has provided the information

Net profit as per Profit and Loss statement Rs.2,390,000 for the year ended 30.06.2011

Other Information:

(i) Accounting depreciation Rs.250,000 and tax depreciation comes to Rs.1,270,500

(ii) A bad debt which was allowed at the time of assessment of Rs.200,000 has been received during the year end kept in liability account.

(iii) Dividend income from a listed Company was credited to P & L of Rs.360,000 (Gross)

Required:

Compute taxable income and tax liability for the tax year 2011 (07)

Q.4. Zee and Gee Ltd has provided you the following data for the month of July, 2011

Value excl. Sales Tax Import Purchases 2,000,000Local Purchases 3,000,000Sales 5,000,000

Other information :

(i) Sales includes an invoice amounting to Rs.1,000,000/‐ which was supplied to provincial government and the government has deducted withholding sales tax.

(ii) Purchase includes an invoice of M/s Lambet & Co. valuing Rs.185,000/‐ (Value excl. Sales Tax) who were declared as black listed on 15‐07‐2011

(iii) Sales to Mr. K was invoiced at Rs.185,700/‐ who has also been declared as black listed on 06‐07‐2011.

(iv) A sales invoice of Rs.200,000/‐ dated 07‐01‐2011 was inadvertently omitted to be recorded in the relevant tax period.

Required:

a) Compute Tax liability for the month of July, 2011. (07)

b) Also calculate default surcharge assuming rate of 18% p.a. (02)

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Summer Exam-2011

(Intermediate)



[Instructions]


• Read the instructions given on the title page of Answer Copy.

• Use separate Answer Copy for Taxation paper.



Q.1. How a bill is passed in the Parliament and becomes an Act? (10)

Q.2. What are the essential elements of a valid consideration? (06)

Q.3. What are the rights of an unpaid seller available to him under sale of Goods Act 1930? (04)

Q.4. Define the following: (06)

(a) Partnership

(b) Partnership at will

(c) Partnership Particular

Q.5. What are the essentials of a valid Bill of Exchange? (04)

Q.6. X misrepresented the model of a car and sold it to Y. Y himself, examined the car and its

documents. Later on, Y took the case to the court of Law that the contract should be

rescinded on the basis of misrepresentation.

Can court grant rescission in this situation?

(05)

Q.7. A agreed to B to write a book having 2 volumes against a remuneration of Rs. 50,000.

When volume-I was completed, A died.

Can legal heirs of ‘A’ claim half payment from ‘B’?

(05)

Q.8. S sells 100 bags of sugar to B. Delivery and payment is to be made 4 months after. Within

these 4 months, S pledged sugar with P, who in good faith advanced Rs. 100,000 to S.

Is this a valid pledge?

(05)

Q.9. Define Company Limited by shares and company Limited by Guarantee. (05)

Q.10. Define an Annual General Meeting. (05)

Q.11. Explain different types of companies under the Companies’ Ordinance, 1984. (10)

Q.12. A seller has displayed a shirt in his shop with a price tag of Rs. 800. A customer comes in

and sees the shirt and decides to buy it. He asks the seller to pack it. Seller refuses to do so

and says that I do not want to sell it. Can customer enforce this sale by law?

(05)

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Taxation (30 Marks)

Q.1. a) Define the followings under Sales Tax Act, 1990.

(i) Supply (02)

(ii) Company (02)

b) Differentiate between exempt and zero rated concepts in Sales Tax. (02)

c) Discuss the provision of apportionment and its exception as Sales Tax input. (02)

Q.2. Mr. V.J. Manufacturer provided the following information of Sales Tax for July 2010. (07)

(Value excl.

Sales Tax)

Rs.

Purchase of imported items from a local vendor 5,000,000

Local purchase raw material 2,000,000

Manufacturing expenses 500,000

KESC Bill paid on 5th

July 2010 500,000

Sales 10,000,000

Required:

Compute sales tax liability for July 2010.

Q.3. a) Define the followings under Income Tax Ordinance, 2001.

(i) Public company u/s 2 (47) (02)

(ii) Taxpayer u/s 2(66) (02)

b) Describe the wholly & exclusively for the purpose of business concept of deduction in

income from business.

(02)

c) Differentiate between provision and accrual with regards to deductions under income

from business.

(02)

Q.4. Mr. Brain has provided you the following information:

• Basic salary Rs. 415,000

• House Rent Rs. 190,000

• Flying Allowance Rs. 1,180,000

• Toyota Cressida valuing Rs. 5 million has been provided by the company

merely for business use.

• Toyota XLi valuing Rs. 1.8 milion has been provided for both office & personal use.

• Interest income of Rs. 75,000/-

Required:

Compute his taxable income for the tax year 2010.

(07)

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Winter Exam-2010 (Intermediate)



[Instructions]





Business Laws (70)

Q.1. Answer the following:

a) What is meant by capacity to contract? (04)

b) Explain briefly ‘Mistake of Law’ and ‘Mistake of Fact’? (04)

c) State the classification of goods under Sales of Goods Act. (04)

d) What is the difference between “Condition” and “Warranty”? (04)

e) Describe the effect of non-registration of a firm. (04)

f) Elaborate the term “Agency by Estoppel”. (04)

Q.2. Describe the following legal terms:

i. Common Law

ii. Equity

iii. Precedent

iv. Customs

(08)

Q.3. (a) What are the Implied Authorities of a partner? (05)

(b) State the rights of outgoing partner. (05)

Q.4. Make list of the following as provided in Companies Ordinance, 1984:

(a) Books of accounts to be maintained by a company. (04)

(b) Persons disqualified for appointment as an auditor of a company. (06)

Q.5. (a) Faisal, a minor, lends Rs. 500/- against a Promissory Note executed in his favour. Is the

borrower liable to repay the money? Justify your answer. (06)

(b) Farooq agrees to pay Rahim Rs. 5,000/- and in consideration Rahim agrees to write for

him 100 pages within five minutes. Is it a valid contract? Justify your answer. (06)

(c) Draft a promissory note dated Oct 31st, 2010 for Rs.10,000/- payable three months

after date. The maker is Mr. Naveed & payee is Mr. Waleed. (06)

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Taxation (30)

Q.1. Discuss the following with reference to Income Tax:

(i) Clubbing of Income Tax & Sales Tax Jurisdiction (01)

(ii) Industrial Undertaking (03)

(iii) Small Company (02)

(iv) Default Surcharge (02)

Q.2. Discuss the following:

(i) Filing of revised return (02)

(ii) Filing of annual return by corporate registered person (02)

(iii) Reasons for issuance of Debit & Credit Note (02)

(iv) Inadmissible input tax (02)

Q.3. Mr. Waseem has provided you the following information:

(a) Rent received from a bank for property C-13, PECHS, Karachi

Rs. 160,000 p.m. for 12 months starting from 01.09.2009.

(b) Rent received from an individual for a shop measuring 1,215 sq ft

rent Rs. 227.5 per Sq. m. p.m. cheque for payment was received

on 01.11.2009 for the eleven months.

Other Information:

• Property Tax paid Rs. 45,000/- for both the properties

• Insurance Premium paid Rs. 25,000/-

• KESC connection of 100 AMP for Rs. 225,000/-

(07)

Required:

Compute his Taxable Income for the tax year 2010

Q.4. A command importer has provided you the following information for a consignment

cleared on 02.07.2010.

Invoice value 5,000 US $

Assessed value 7,500 US $

Dollar rate Rs. 88.50

Custom duty @ 15% at volume

Income Tax & Sales Tax applicable rate as per prevailing rate

Required:

Compute the value of pay order to be given to the Commissioner of Overland

Revenue. Also show your breakup of the amount.

(07)

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Summer Exam-2010 (Intermediate)



[Instructions]





Business Laws (70)


a) State any four objectives of Companies Ordinance, 1984 (04)

b) How in contract of guarantee, there is a triangular relationship? (04)

c) Describe legal status of a company as compared to Partnership. (04)

d) What do you mean by the term Caveat Emptor? (04)

e) What is test of partnership? (04)

f) Explain “A minor contract is no contract in law”. (04)

g) What are the rights of unpaid seller? (04)

Q.2. What is meant by Law? State the sources of Law. (10)

Q.3. Define the term “Contract”. What are the essential of a valid contract? (12)

Q.4. Describe the persons who are ineligible to become Director of a company under

Companies Ordinance, 1984.

(10)

Q.5. (a) Draft a promissory note dated October 31st

, 2008 payable three months after date.

The maker is Mr. Naveed and the payee is Mr. Waleed.

(05)

(b) A minor, fraudulently represented to a moneylender that he was of full age, and

obtained a loan of Rs. 10,000. Has the money lender any right of action against the

minor for the money lent or for damages of fraudulent representation?

(05)

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Taxation (30)

Q.1. Discuss the following with reference to Income Tax Ordinance, 2001

(i) Accumulated Profit (02)

(ii) Exclusion of dividend income (02)

(iii) Comparison of PTR and separate block of income (02)

(iv) Withholding agent (01)

(v) Concept of marginal relief (01)

Q.2. Compute the taxable income for the tax year 2009: (07)

ZAKA & CO.

Profit & Loss Account

Administrative exp. 750,000 Gross Profit 2,100,000

General exp. 215,000

Financial exp. 310,000

1,275,000

Net Profit 825,000

2,100,000 2,100,000

The following further information has been provided:

(a) Breakage has been deducted from purchase of an amount of Rs.23,700/- and

claimed as an Admin Expense.

(b) Initial depreciation on the assets added during the year comes to Rs.415,700/-

(c) Professional fee of Rs.70,000/- for the year 2009 was paid and tax was deducted

@ 3.5%

Q.3. Zakria & Company is a manufacturer registered with sales tax has provided you the

following information.

Sales to registered person Rs. 50 million Taxable

Sales to registered person Rs. 15 million Exempt

Sales to unregistered person Rs. 20 million taxable

KESC Bill (for Jan paid on 03-02-2010) Rs. 5 million

Purchases – registered person Rs. 37.5 million

Other Information:

i) An invoice was issued to province of Sindh for Rs.2 million (value excl.

sales tax), withholding of sales tax was deducted and the balance was paid

ii) Sales tax included in KESC Bill is Rs.670,000/-

iii) An invoice dated 05-02-2009 valuing Rs.200,000/- (Value excl. sales tax)

issued to M/s. K.K. Enterprises was omitted to be included in sales tax

output list.

Required:

Compute his sales tax liability for the month of February 2010

Also calculate default surcharge if any @ 1.5% pm

(07)

Q.4. a) Define the following.

i) Zero rated & exempt supplies (02)

ii) Time & Manner of Payment of tax (02)

iii) Tax fraud (01)

b) Discuss the provision of apportionment of sales tax at the time of final

adjustment of tax.

(03)

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Winter Exam-2009

(Intermediate)



[Instructions]



• Use separate Answer Copies for Business Laws and Taxation.


Business Laws (70)


(a) Under what circumstances the consent is not said to be free? (04)

(b) What is the difference between ‘Condition’ and ‘Warranty’? (04)

(c) What is the prospectus of a Company? (04)

(d) Explain ‘Implied Authority of Partners’. (04)

(e) Differentiate between fraud and Misrepresentation. (04)

(f) When is the banker bound to refuse to honor a cheque of customer? (04)

(g) What are the rights of outgoing partner? (04)

Q.2. What is Law? Describe the classification of Law enforced in Pakistan. (08)

Q.3. Define Contract. Who is incompetent to Contract? (12)

Q.4. (a) Define a Cheque and crossing of a cheque. (05)

(b) Explain the various types of crossing of a cheque. (05)

Q.5. With reference to the Companies Ordinance, 1984, describe the following:

(a) Memorandum of Association (06)

(b) Articles of Association (06)

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2

Taxation (30)

Q.1. Finance Act, 2009 has introduced following amendments. Explain:

(i) Basis of Computation of Additional Tax (02)

(ii) Taxation of bonus paid to Corporate employees (02)

(iii) Advance Tax u/s 147 (02)

(iv) E-filling of Income Tax return by salaried person. (02)

(v) Tax credit for manufacturer making 90% sales to registered persons. (01)

(vi) Minimum tax on Turnover declared by resident companies (01)

Q.2. Mr. Jay is an employee of K.K. (Pvt) Ltd has provided the following information:

(a) Basic salary 1.25 million (b) House rent allowance 50% of basic (c) Two cars having worth of 1.0 m and 1.7 m have been provided, earlier

for private and later purely for office use. (d) Bonus 0.3 million (e) Provision of medical allowance 0.2 million

Required:

Compute his tax liability for tax year ending 30-06-2010

Applicable Income Tax rate is 15%.

(05)

Q.3. Marhaba Traders has provided the following information and seek your advice in the following situation.

(a) An invoice of sales carrying value of Rs.500,000/- dated 15-07-08 was omitted to be recorded in the output register for the month of July, 08

(b) Sales tax credit for the month of July, 08 was Rs.14,500/-

The lapse was detected in the month of October, 2008.

Required: i. Compute sales tax payable for the month of July, 08 ii. Default surcharge ; if any iii. Advise him about the tax amnesty announced by the FBR and suggest him

regarding the line of action to be taken

(04)

Q.4. (a) Enumerate the following with respect to Sales Tax Act, 1990

i. Applicability of Finance Act, 2009 the effective date of the enactment for filing and deduction.

ii. Filing of return in case of change of rate during tax period. iii. Recent changes introduced in payment of Sales Tax.

(02)

(02) (02)

(b) Abdul Hameed & Co. a registered person failed to pay Sales Tax for the month of July, 08 of Rs. 2,643,285/- and seek your professional advice regarding the handling of the issue. Advise them the sales tax payable alongwith the default surcharge in case the payment is made in the month of January, 09.

(05)

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Summer Exam-2009

(Intermediate)



[Instructions]



• Use separate Answer Copies for Business Laws and Taxation.


Business Laws (70)


(a) What do you know about Contract? (04)

(b) What is the effect of Non-registration of a firm? (04)

(c) Distinguish between Sale and Agreement to sell. (04)

(d) How in contract of guarantee, there is a triangular relationship? (04)

(e) What do you mean by the term Caveat Emptor? (04)

(f) What is test of Partnership? (04)

(g) What are the rights of unpaid seller? (04)

Q.2. Differentiate between Statute Law and Ordinance? (10)

Q.3. Why consideration is essential in a contract? State its legal rules. (12)

Q.4. Describe the persons who are ineligible to become Director of a company under Companies Ordinance, 1984.

(10)

Q.5. (a) Draft a promissory note dated October 31, 2008 payable three months after date. The maker is Mr. Naveed and the payee is Mr. Waleed.

(05)

(b) A minor fraudulently represented to moneylender that he was of full age, and obtained a loan of Rs. 10,000. Has the money lender any right of action against the minor for the money lent or for damages of fraudulent representation?

(05)

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2

Taxation (30)

Q.1. Define the following: (Income Tax)

(i) Non-adjustable input Tax (02)

(ii) Deductible allowance (02)

(iii) Separate block of income (02)

(iv) Public Company (02)

(v) Extent of input tax adjustment (02)

Q.2. (a) Finance Act, 2008 has introduced changes in the taxation of income from property , discuss (05)

(b) Mr. Joy , chief executive of a limited company provided the following data for the tax year 2009:

Taxable salary (01.07.08 to 30.06.09) Rs.465,000

Reimbursement of medical exp. Rs.230,000 (as per terms of employment)

Tax estimated to be deducted Rs.16,275

He is not satisfied with the above tax estimated to be deducted. Advise and assist him in calculating the correct tax liability and saving if any. Moreover, he wants a briefing of the marginal relief recently offered through Finance Act.2008

1. Tax rate when the income does not exceed Rs.450,000 2.5% Tax rate when the income does not exceed Rs.550,000 3.5%

2. Marginal Relief

20% of the amount by which total income exceed the said limit when the total income does not exceed Rs.500,000/-

Required:

Compute the tax liability

(05)

Q.3. Silver lining, a manufacturer has provided the following information for the month of July, 2008:

Value Duty Sales Tax

Purchases Rs.2,000,000 Rs.20,000 Rs.320,000 Sales 2,500,000 @1% 400,000 Motor car purchased For business use 1,000,000 160,000 Canteen supplies 5,000 800

Required:

Compute sales tax liability or refund to be claimed for the month of July, 08.

(10)

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Winter Exam-2008

(Intermediate)



[Instructions]



• Use separate Answer Copy for Business Laws & Taxation.


Business Laws (70)


(a) What is agency by estoppels? [04]

(b) When does an agreement become a contract? [04]

(c) What are bilateral and unilateral contracts? [04]

(d) How can an offer be revoked? [04]

(e) What is “Company limited by guarantee? [04]

(f) Mention two important characteristics of a “Negotiable Instrument” [04]

(g) Can a minor be admitted to the benefits of partnership? If so, how? [04]

Q.2. What is legislation? State the process of Legislation? [10]

Q.3. Discuss the types of meetings in detail. [10]

Q.4. (a) Draw the Court Structure in Pakistan. [06]

(b) Explain ‘condition’ and ‘warranty’ under Sales of Goods Act, 1930 [06]

Q.5. (a) Make list of the following as provided in Companies Ordinance, 1984:

(i) Books of accounts to be maintained by company. [02]

(ii) Persons disqualified for appointment as an auditor of a company. [06]

(b) Under Section-254, who is qualified for appointment as an auditor? [02]

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Contd. on back

2

Taxation (30)

Q.1. Discuss the following with regard to Finance Act, 2008 (Sales Tax)

(i) E-filing of returns and statement of purchase and sales [03]

(ii) Claim of input in succeeding period and on fixed assets [03]

(iii) Filing of revised return [04]

Q.2. Mr. A has imported certain items from Japan at declared value of US$ 20,000/-. His clearing agent sent him a bill showing the following details:

[08]

Value assessed US$ 25,000 @ Rs. 70/- per dollar.

Custom duty @ 10%

Sales Tax at the normal prevailing rate

Income Tax @ 6%

Special Excise Duty @ 1%

Calculate:

His Sales Tax liability at import stage.

Q.3. Discuss the following concepts with regard to Sales Tax Act, 1990:

(a) Default Surcharge [02]

(b) Due Date [02]

(c) Input Tax adjustment on stock acquired before registration [03]

Q.4. Mr. Vee is an individual dealing in grams. During the tax year ended on 30th June 2008, he has furnished the following income in his annual return.

[05]

Opening Stock Purchases Salaries Rent Commission Depreciation Advertisement Bank Charges Stationery Personal Expenses Bad debts (reserve) Income Tax for Tax year 2005 Net profit

Rs. 104,000

1,008,000 75,000 31,000 11,500 20,000 6,000 2,500

14,000 25,000 50,000 20,000

353,000

Sales Closing Stock

Rs. 1,450,000 270,000

1,720,000 1,720,000

Closing stock has been valued at 20% below cost price. Tax depreciation Rs. 25,000/-

Required:

Work out the Total Taxable income and Tax payable of Mr. Vee.

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BL&T

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