Mohan owns a house which is constructed on lease-hold land. This house has been let-out to Ram for ₹15,000 per month under the following terms and conditions: He will pay 40% of the municipal taxes and bear cost of repai
CS Executive · Tax Laws and Practice · PYQS · December 2014
Mohan owns a house which is constructed on lease-hold land. This house has been let-out to Ram for ₹15,000 per month under the following terms and conditions: He will pay 40% of the municipal taxes and bear cost of repairs. He is also required to give advance of ₹2,00,000 which will be interest-free. He will pay the premium of ₹1,00,000 for leasing the property for five years. Annual value assessed by the local authority is ₹1,50,000 and local tax is 10%. The gross maintainable rent under the Wealth-tax Act, 1957 will be —
Answer & Explanation:
Correct Answer: Option (B)
Correct answer: (B) ₹2,56,000. Gross maintainable rent = 1,80,000 rent + 6,000 tenant-borne municipal taxes + 20,000 repairs adjustment + 30,000 deposit-interest adjustment + 20,000 annualised premium = 2,56,000. This answer applies to the historical law and assessment-year context of this December 2014 paper; later amendments may differ.
Topics: Wealth Tax Act, 1957
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