Ukuran huruf
Lembar kerjaIncome-tax Act MCQs
Total soal: 152
Worksheet time: 1hrs 16mins
The Income-tax Act, 1961 came into force on:
1st January 1961
1st April 1962
1st April 1961
15th August 1962
"Previous Year" under Section 3 generally means:
Calendar year
Financial year immediately preceding the assessment year
Year of earning income and assessment both
Any 12-month period chosen by assessee
Income of a non-resident seafarer for services rendered outside India is:
Taxable in India always
Exempt even if credited to NRE account in India
Taxable only if received in India
Partially taxable
Residential status is determined:
Once in lifetime
Based on citizenship
Separately for each assessment year
Based on domicile
Which of the following is NOT an exception to the "60 days + 365 days" rule?
Indian citizen leaving India for employment
Crew member of Indian ship
Indian citizen/PIO visiting India
Indian citizen going abroad for business tour
A person is RNOR if:
Non-resident in 9 out of 10 preceding years, OR stayed ≤729 days in last 7 years
Stayed 365 days in last 4 years
Stayed 182 days in PY
None of the above
Place of Effective Management (POEM) relates to residential status of:
Individuals
HUF
Company
AOP/BOI
Which of the following is "deemed to be received" income?
Salary received in India
Employer's contribution to RPF exceeding 12% of salary
Dividend from Indian company
Income earned abroad by a non-resident
Dividend declared by a foreign company outside India is:
Deemed to accrue in India if company has Indian assets
Not deemed to accrue in India
Always taxable in India
Tax-free only for residents
Salary for services rendered in India is taxable in India:
Only if received in India
Only if paid in India
Irrespective of where paid or received
Only if employer is resident
Under Section 9, interest is deemed to accrue in India if:
Payable by Government of India
Payable by a resident for business outside India
Paid by non-resident for personal investment abroad
Paid by foreign company to foreign lender
Significant Economic Presence (SEP) is introduced to tax:
Agricultural activities
Digital economy and e-commerce transactions
Salary income of NRIs
Indian subsidiaries of foreign companies
The assessment year immediately follows:
Calendar year
Previous year
Financial year
Any period chosen by assessee
The normal time limit for completing assessment under Section 143(3) is:
6 months from end of FY of return filing
12 months from end of AY in which return is filed
18 months from end of AY
9 months from end of FY
An intimation under Section 143(1) can be issued for:
Summary assessment without calling assessee
Detailed scrutiny with notice
Reassessment of escaped income
Best judgment assessment
Before issuing notice under Section 148, the AO must:
Record reasons in writing only
Obtain prior approval of High Court
Follow procedure under Section 148A
Get assessee's consent
Minimum & maximum time given to assessee for reply to SCN under Sec. 148A(b) is:
5 - 15 days
7 - 30 days
10 - 60 days
15 - 45 days
Order under Section 148A(d) must be passed within:
7 days from reply
15 days from SCN
1 month from end of month in which reply received / time expired
No time limit
Section 148A procedure is NOT required in cases of:
Search under Section 132 after 01.04.2021
Requisition under Section 132A after 01.04.2021
Survey under Section 133A(2A)
All of the above
Normal time limit for issuing notice u/s 148 is:
3 years from end of relevant AY
6 years from end of relevant AY
10 years from end of relevant AY
12 years from end of relevant AY
Beyond 3 years, notice can be issued up to 10 years only if:
Income escaping assessment > ₹50 lakh represented in form of asset/expenditure/entries
AO records satisfaction only
Any audit objection is raised
Any loss is recomputed
Specified authority for sanctioning notice u/s 148 if ≤3 years elapsed:
PCIT/CCIT
JCIT
AO himself
CBDT
Specified authority if >3 years elapsed:
AO with JCIT approval
Pr. CCIT or DGIT
CBDT only
None
Time limit for reassessment u/s 153(2):
6 months from end of FY of notice
9 months from end of FY of notice
12 months from end of FY of notice
24 months from end of FY of notice
If reference made to TPO, reassessment time limit extends by:
3 months
6 months
9 months
12 months
Which instruction currently governs the SOP for handling receipt/revenue audit objections?
Instruction No. 7/2017
Instruction No. 16/2013
Instruction No. 3/2024 dated 17.09.2024
Manual on Office Procedure, 2019
Revenue Audit conducted by C&AG can be of which types?
Performance Audit and Compliance Audit
Internal Audit and External Audit
Revenue Audit and Statutory Audit
Receipt Audit and Expenditure Audit only
Which conference marks the initiation of a Revenue Audit?
Exit Conference
Entry Conference
Draft Para Stage
IDM Meeting
A Major Audit Objection for Income-tax is one where the revenue effect is:
₹1,00,000 or more
₹2,00,000 or more
₹5,00,000 or more
₹10,00,000 or more
Appeal before CIT(A) is governed by which section?
Section 244A
Section 246A
Section 147
Section 250
Appeal to CIT(A) must be filed in which form?
Form No. 34
Form No. 35
Form No. 36
Form ITNS-51
Time limit for filing appeal before CIT(A):
15 days
30 days
45 days
60 days
CIT(A) has powers co-terminus with:
High Court
ITAT
Assessing Officer
CBDT
Cross-objections to ITAT appeal must be filed within:
15 days
30 days
45 days
60 days
Tribunal is the final fact-finding authority, meaning:
It can overturn SC rulings
Its finding on facts is final unless perverse
Its orders cannot be appealed to HC
It has power of enhancement of assessment
acts is final unless perverse
Its orders cannot be appealed to HC
It has power of enhancement of assessment
Clubbing of Income Income of spouse is clubbed with assessee's income if transferred without adequate consideration, under:
Section 60
Section 64(1)(iv)
Section 61
Section 64(2)
Income from assets transferred to son's wife without adequate consideration is:
Exempt
Taxable in hands of transferor (husband/father-in-law)
Taxable in hands of son's wife
Taxable in hands of HUF
When a minor child earns income, it is generally:
Exempt from tax
Clubbed with parent having higher income
Clubbed with parent having lower income
Taxable separately in minor's hands
Which income of minor child is not clubbed with parents?
Interest income from FD
Winnings from lottery
Income from manual work or special skills
Rental income from property gifted
Under Section 80A, the total deductions under Chapter VIA cannot exceed:
50% of Gross Total Income
100% of Gross Total Income
150% of Gross Total Income
No limit
Deductions under Chapter VIA are not allowed from which of the following incomes?
Salary income
Business income
Long-Term Capital Gains taxable u/s 112
Income from House Property
As per Section 80AC, deductions under Chapter VIA are allowed only if:
Assessee files return within 1 year
Assessee files return before the due date u/s 139(1)
Assessee pays advance tax before 31st March
Assessee files revised return
Maximum deduction allowed u/s 80C is:
₹1,00,000
₹1,50,000
₹2,00,000
₹2,50,000
Which of the following payments is NOT eligible for deduction u/s 80C?
Life insurance premium for spouse
Tuition fee for two children
Repayment of housing loan principal
Donation to a political party
Section 80CCD(1B) provides for additional deduction of:
₹25,000 for NPS contribution
₹50,000 for NPS contribution
₹75,000 for NPS contribution
₹1,00,000 for NPS contribution
Maximum deduction allowed u/s 80D for an individual paying health insurance premium for self, spouse, and dependent children (non-senior citizen) is:
₹15,000
₹20,000
₹25,000
₹50,000
Fixed deduction under Section 80DD for dependent relative with severe disability (≥80%) is:
₹50,000
₹75,000
₹1,00,000
₹1,25,000
Deduction u/s 80E is available for:
Repayment of principal of education loan
Repayment of interest on education loan
Both principal & interest on education loan
Tuition fees paid for higher education
Deduction u/s 80TTA (interest on savings account) is limited to:
₹5,000
₹10,000
₹25,000
₹50,000
Capital asset does not include:
Jewellery
Drawings and paintings
Stock-in-trade
Archaeological collections
Agricultural land situated within 8 km of a municipality with population above 10,000 is:
Always rural agricultural land
Treated as capital asset
Treated as personal effects
Exempt from taxation
Holding period for listed shares to qualify as Long-Term Capital Asset (LTCA):
6 months
12 months
24 months
36 months
From 23rd July 2024, which asset is always treated as short-term, irrespective of holding period?
Sovereign Gold Bonds
Market Linked Debentures
Listed Equity Shares
Rural agricultural land
Which section defines transfer of a capital asset?
Section 2(42A)
Section 2(47)
Section 45(1)
Section 48
Conversion of capital asset into stock-in-trade is taxed in:
Year of conversion
Year of actual sale of stock-in-trade
Year of acquisition
Year of approval by AO
Transfer of depreciable assets under Section 50 results in:
LTCG
STCG
Exempt income
Business income
Full value of consideration in case of compulsory acquisition is:
FMV on date of acquisition
Amount recorded in books
Compensation received
Indexed cost of acquisition
Enhanced compensation received later is taxable in:
Year of acquisition
Year of receipt
Year of award
Year of appeal
Redemption of preference shares is considered as:
Exchange
Relinquishment
Transfer
Gift
In case of zero coupon bonds, tax arises on:
Date of allotment
Date of maturity/redemption
Date of acquisition
Date of listing
Indexation benefit is not available on:
Sovereign Gold Bonds
Depreciable assets
Land & Building
Equity shares
In case of Joint Development Agreement (JDA), capital gains are chargeable in:
Year of transfer of land
Year of completion certificate
Year of allot
In case of Joint Development Agreement (JDA), capital gains are chargeable in:
Year of transfer of land
Year of completion certificate
Year of allotment
Year of payment of consideration
FIFO method for period of holding applies to:
Demat securities
Physical gold
Immovable property
Self-generated goodwill
Cost of acquisition in self-generated goodwill after Finance Act 2023 is:
FMV as on 01.04.2001
NIL
Purchase price paid
Indexed FMV
Section 45(1A) deals with:
ULIP taxation
Insurance compensation on destruction of asset
Transfer to firm as capital contribution
Conversion into stock-in-trade
Which of the following is not treated as a transfer?
Gift
Sale
Exchange
Relinquishment
For assets acquired before 01.04.2001, COA is taken as:
FMV as on 01.04.2001 or Actual cost (whichever higher)
Actual cost only
Stamp duty value
Nil
Which section provides computation mechanism of capital gains?
45
46
48
50
Section 54 exemption is available on:
Sale of rural agricultural land
Sale of residential house property
Sale of jewellery
Sale of depreciable asset
In case of slump sale, indexation is:
Allowed fully
Not allowed
Allowed partially
Depends on AO
Transfer of shares by a non-resident purchased in foreign currency - indexation benefit is:
Allowed
Not allowed
Allowed only if held > 36 months
Allowed at RBI rate
Which case held that land and building are separate assets for capital gains?
CIT vs RasiklalManeklal
CIT vs Sri Sekhar Gupta
Arun Sunny v. CIT
Rana Hemant Singhji v. CIT
In case of retirement from a firm, capital gain taxation is covered under:
Sec 9B & 45(4)
Sec 48 & 49
Sec 50C
Sec 55
Enhanced compensation interest u/s 56(2)(viii) is taxed as:
Capital gain
Salary
Income from Other Sources (50% deduction allowed)
Business income
Salary is taxable under which section of the Act?
Sec. 15-17
Sec. 28
Sec. 45
Sec. 56
Essential condition for charging income under salary:
Agent-principal relation
Employer-employee relation
Contractor-client relation
None of these
Arrears of salary are taxable in:
Year to which they relate
Year of receipt
Either year, at employee's option
Exempt
Standard deduction for AY 2024-25 is:
₹40,000
₹50,000
₹60,000
₹75,000
Professional tax paid by employee is deductible under:
Sec 80C
Sec 80D
Sec 16(iii)
Sec 17(1)
Entertainment allowance deduction is available to:
All employees
Only govt. employees
Only PSU employees
None of these
House Rent Allowance exemption is available if rent paid exceeds:
5% of salary
10% of salary
15% of salary
20% of salary
LTC exemption is available for how many journeys in a block of 4 years?
1
2
3
4
Leave encashment received during service is:
Fully exempt
Fully taxable
50% exempt
Exempt up to ₹3,00,000
Gratuity exemption limit as per Notification dated 08.03.2019:
₹10 lakhs
₹15 lakhs
₹20 lakhs
₹25 lakhs
Commuted pension for Central Govt employees is:
Fully exempt
1/3rd exempt
1/2 exempt
Fully taxable
Uncommuted pension is:
Fully exempt
50% exempt
Fully taxable
Exempt only for govt employees
Remuneration to an ordinary director is taxable under:
Salary
PGBP/Other Sources
Capital gains
Exempt
Voluntary surrender of salary to Central Govt under 1961 Act is:
Exempt
Partially exempt
Fully taxable
Deductible u/s 80C
Leave encashment exemption limit for non-govt employees u/s 10(10AA):
₹3 lakhs
₹10 lakhs
₹20 lakhs
₹25 lakhs
Value of perquisite in case of rent-free accommodation to MP or Judge:
Fully exempt
50% exempt
Taxable at market rent
Partially exempt
Salary is deemed to accrue in India if services are rendered in India, even if:
Paid abroad
Credited abroad
Employment ended abroad
All of the above
Seafarers who qualify as non-residents, salary for services outside India is:
Fully taxable
Exempt
Taxed at 50%
Taxed in foreign country only
Entertainment allowance deduction (Govt employee) is least of:
Actual received, 20% of basic, or ₹5,000
Actual received, 10% of salary, or ₹3,000
Fixed ₹10,000
Actual received only
Annuity received from employer is taxable as:
Salary
Other Sources
Capital Gain
Exempt
Commission received as a fixed % of turnover is considered part of:
Allowance
Salary for HRA purposes
Exempt income
Bonus
Family pension is taxable under:
Salary
PGBP
Other Sources
Exempt fully
Arrears of salary relief is available u/s:
Sec 80C
Sec 80D
Sec 89(1)
Sec 87A
Which allowance is fully exempt?
Transport allowance
Travelling allowance for official duty
City compensatory allowance
Medical allowance
Which is included in definition of salary under Sec 17(1)?
Wages
Pension
Bonus
All of the above
Income from house property is taxable on the basis of:
Ownership
Possession
Usage
Lease agreement
Self-occupied house property annual value is taken as:
Actual rent received
Higher of municipal value or fair rent
Nil
Standard rent
Maximum deduction for interest on housing loan u/s 24(b) for self-occupied property (AY 2024-25) is:
₹1,00,000
₹1,50,000
₹2,00,000
₹2,50,000
Pre-construction interest is deductible in:
Lump sum in year of payment
3 equal instalments
5 equal instalments from year of completion
Not allowed
Unrealised rent is deducted from:
Gross Annual Value
Net Annual Value
Standard deduction
Not allowed
Standard deduction u/s 24(a) is:
20% of NAV
25% of NAV
30% of NAV
50% of NAV
If a property is partly let-out and partly self-occupied, annual value is computed:
Separately for each portion
Only on let-out portion
On entire property as let-out
Exempt
Municipal taxes are deductible only if:
Borne by tenant
Borne by owner and actually paid
Accrued but unpaid
Shown in books
Municipal taxes are deductible only if:
Borne by tenant
Borne by owner and actually paid
Accrued but unpaid
Shown in books
Unrealised rent recovered later is:
Exempt
Taxable under IFHP
Taxable under IOS u/s 56
Adjusted against NAV
Arrears of rent received are taxable in:
Year to which they relate
Year of receipt
Either, at assessee's choice
Exempt
Profits and gains of business or profession are chargeable to tax under:
Section 15
Section 28
Section 45
Section 56
Income of a partner from a partnership firm by way of salary, bonus, commission is taxable under:
Salary
PGBP
Other sources
Capital gains
Expenses not deductible under section 37(1):
Revenue expenditure incurred wholly for business
Capital expenditure
Personal expenses
Both b & c
Disallowance u/s 40A(3) is attracted if payment in cash exceeds:
₹5,000
₹10,000
₹20,000
₹25,000
Deduction for scientific research expenditure u/s 35 is allowed if:
Revenue expenditure only
Capital expenditure only (excluding land)
Both a & b
None
Amount received by a professional from foreign clients for consultancy is taxable under:
Salary
PGBP
Other sources
Capital gain
Family pension is taxable under:
Salary
PGBP
Other sources
House property
Presumptive taxation u/s 44AD is applicable to:
Professionals only
Businesses (other than transport, agency, commission)
Companies
LLPs
Presumptive rate of profit u/s 44AD is:
6%/8% of turnover
10% of turnover
12% of turnover
15% of turnover
Books of accounts are required u/s 44AA for professionals if gross receipts exceed:
₹10 lakh
₹25 lakh
₹50 lakh
₹1 crore
Under which sections is 'Income from Other Sources' (IOS) covered in the Income-tax Act?
Sections 28 to 44
Sections 56 to 59
Sections 45 to 55
Sections 60 to 65
IOS is considered as which type of head of income?
Primary
Residuary
Optional
Exempt
Income will be chargeable under IOS only if:
(i) only
(i) and (ii)
(i) and (iii)
(i), (ii) and (iii)
Dividend income is taxable under:
Salaries
Business Income
Other Sources
Exempt
Casual incomes such as lottery winnings are taxable at a flat rate of:
20%
25%
30%
35%
Which section provides tax on casual incomes like lottery winnings?
115BB
115BAA
115BAC
115BAD
Which of the following is not allowed as deduction from casual income?
Expenditure
Loss from other heads
Deduction under Chapter VI-A
All of the above
Family pension received by legal heirs is taxable under:
Salaries
House Property
Other Sources
Capital Gains
Deduction from family pension under Section 57 is:
1/4th of pension or ₹10,000 whichever is less
1/3rd of pension or ₹15,000 whichever is less
50% of pension or ₹20,000 whichever is less
Full pension exempt
Daily allowance received by MP/MLA is:
Fully Taxable
Fully Exempt
Partially Exempt
Taxable at 50%
Dividend from foreign company is taxable at:
10%
15%
Normal rates
Exempt
Dividend received by an Indian company from a specified foreign company u/s 115BBD is taxable at:
10%
15%
20%
25%
Keyman insurance policy proceeds are taxable under IOS if received by:
Employer
Employee
Family members/legal heirs
None
Interest on Income Tax refund is taxable under:
Business Income
Salaries
Other Sources
Exempt
Forfeited advance money in negotiation for transfer of capital asset is taxable under IOS from:
A.Y. 2010-11
A.Y. 2013-14
A.Y. 2015-16
A.Y. 2020-21
Gift provisions under Section 56(2)(x) are applicable to:
Only Individuals
Only HUFs
Any person
Only Companies
Cash gift exceeding ₹50,000 received without consideration is:
Fully exempt
Fully taxable
Exempt up to ₹1,00,000
Exempt if from friend
Immovable property received without consideration is taxable if Stamp Duty Value exceeds:
₹10,000
₹25,000
₹50,000
₹1,00,000
In case of immovable property received for inadequate consideration, difference is taxable if it exceeds higher of:
₹10,000 or 5% of consideration
₹25,000 or 8% of consideration
₹50,000 or 10% of consideration
₹75,000 or 15% of consideration
Relative for gift purposes does not include:
Uncle
Aunt
Nephew
Brother
Interest on securities is taxable under IOS if securities are held:
As stock-in-trade
As investment
Both (a) and (b)
None
Grossing up of interest on securities after TDS is calculated as:
Net × 100 / (100 + TDS rate)
Net × 100 / (100 - TDS rate)
Net × 100 / TDS rate
Net × TDS rate / 100
Rate of TDS on interest on securities (other than Govt. securities) u/s 193 is:
5%
7.5%
10%
15%
Maximum exemption of Post Office SB account interest is:
₹1,500 (individual) / ₹3,000 (joint)
₹2,500 (individual) / ₹5,000 (joint)
₹3,500 (individual) / ₹7,000 (joint)
Fully exempt
Income under Sections 68, 69, 69A, 69B, 69C, 69D is taxable u/s 115BBE at:
30%
40%
50%
60%
Expenses allowed from dividend/interest income u/s 57 include:
Commission to banker
Interest on borrowed money
Collection expenses
All of the above
Expenditure not deductible u/s 58 includes:
Personal expenses
Income-tax paid
Expenditure from lottery winnings
All of the above
Bond washing transactions are covered under:
Section 92
Section 94(1)
Section 115BBE
Section 80C
Dividend stripping provisions are covered under:
Section 94(7)
Section 94(8)
Section 115BB
Section 80IA
Bonus stripping provisions are covered under:
Section 94(7)
Section 94(8)
Section 94(9)
Section 115BB
