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CMA Intermediate · Direct and Indirect Taxation · Taxation of Individuals (including AMT) and HUF

Rohit, a resident individual under the new regime (section 202(1) rates), has a total income of Rs 12,10,000. Slab tax on this income is Rs 61,500. What is his tax payable after rebate under section 156(2) and 4% cess?

Tax payable is Rs 10,400. The rebate under section 156(2)(b) equals the slab tax minus the income above Rs 12 lakh, so tax is limited to Rs 10,000. Adding 4% cess of Rs 400 gives Rs 10,400.

  1. ARs 10,400Correct
  2. BRs 10,000
  3. CRs 61,500
  4. DRs 63,960

Explanation

Total income exceeds Rs 12 lakh by Rs 10,000. Under section 156(2)(b), because tax Rs 61,500 exceeds the excess income Rs 10,000, rebate = 61,500 - 10,000 = Rs 51,500. Tax after rebate = Rs 10,000; cess at 4% = Rs 400; total Rs 10,400. Rs 10,000 omits cess.

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