Income Tax Law & Practice-II (Income from other sources)

Babu Lai won a prize of ₹ 1,00,000 in Rajasthan State Lottery and the Lottery Department paid him an amount of ₹ 70,000 after deduction of tax at source of 130,000. He had purchased lottery tickets for ₹ 8,000.

The amount chargeable to tax in the hands of Babu Lai under other sources shall be:

• (A) ₹ 70,000

• (B) ₹ 1,00,000

• (C) ₹ 92,000

• (D) None of the above

In the hands of Mr. Sarath, a salaried employee, the following income shall be chargeable to tax as income under the head “Income from other sources”:

(i) Dividend

(ii) Income from the hiring of machinery

(iii) Winning from Lottery

(iv) Interest on securities

Select the correct answer from the options given below:

• (A) (i) and (iii)

• (B) (iii) and (iv)

• (C) All the four above

• (D) (i), (iii) and (iv)

Ms. Anshu received a dividend of ₹ 80,000 for her equity shareholding in MNO Ltd. (a listed company). She paid an interest of ₹ 12,500 for the amounts borrowed for investment in those shares. The taxable dividend income would be:

• (A) ₹ 80,000

• (B) ₹ Nil

• (C) ₹ 67,500

• (D) ₹ 92,500

Ram received ₹ 80,000 by way of gifts from friends upon retirement from service in a private company.

The amount of gift chargeable to income-tax would be:

• (A) Nil

• (B) ₹ 30,000

• (C) ₹ 70,000

• (D) ₹ 80,000

Mr. Ravi solved a crossword puzzle and received ₹ 84,000 after deduction of tax at source.His income from crossword puzzle chargeable to tax would be:

• (A) ₹ 84,000

• (B) Nil

• (C) ₹ 72,000

• (D) ₹ 1,20,000