Section 22 to 37 of Income Tax Act, 1961

1.Which of the following receipts is generally considered non-taxable, unless specifically stated otherwise?A. Revenue Receipts

• A. Revenue Receipts

• B. Capital Receipts

• C. Compensation for contract termination

• D. Agency Commission

2. Any compensation for termination of business contracts is taxable as per Section 28(ii)(e). Which of the following would not be covered under this clause?

• A. A freelance journalist receiving termination compensation

• B. A businessman receiving payment for ending a dealership

• C. A distributor receiving payout due to contract non-renewal

• D. A shop owner being paid to vacate a rented property

3. Income from letting out residential house by an owner shall be taxable under:

• A. Profits and Gains of Business or Profession

• B. Income from Other Sources

• C. Capital Gains

• D. Income from House Property

4. A speculative business under Section 43(5) excludes:

• A. Hedging contracts in raw materials

• B. Share trading settled without delivery

• C. Futures trading in commodities

• D. Stock option contracts on NSE

6. A company develops a website that allows customers to book services, make payments, and interact with the support team. The website is expected to be used over the next 5 years. How should the development cost be treated under the Income Tax Act?

• A. As revenue expenditure, since it enhances customer interaction

• B. As capital expenditure, since it provides an enduring benefit and performs core business operations

• C. Fully deductible under Section 37(1) in the year incurred

• D. Treated as deferred revenue expenditure over 10 years

7. In case of amalgamation after claiming 2 installments under Section 35DDA, who claims the remaining deductions?

• A. The amalgamating company

• B. The shareholders

• C. The amalgamated company

• D. No one can claim

Freebies given by pharma companies to doctors are not allowed as deduction because:

• A. They are capital in nature

• B. They are personal expenses

• C. They violate MCI regulations

• D. They are not actually incurred

Mr. A owns a property and transfers it without consideration to his minor son. Who is deemed owner under Sec. 27?

• A. Minor son

• B. Mr. A

• C. Grandfather

• D. None

Interest on loan taken from friend (without actual payment yet) is:

• A. Not deductible

• B. Deductible if interest is payable

• C. Deductible only if bank certified

• D. Deductible after loan is repaid

Annual value of property held as stock-in-trade is nil for

• A. two year from construction

• B. Till property is sold

• C. Two years from completion certificate

• D. Five years after possession