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MULTIPLE CHOICE QUESTIONS ON

INCOME TAX FOR RECAPITULATION


1) The Income-tax Act extends to:
(A) whole of India
(B) whole of India except Jammu and Kashmir
(C) whole of India except Sikkim
(D) whole of India except Jammu & Kashmir and Sikkim
(A)
2) Finance Bill becomes the Finance Act when it is passed by:
(A) the Lok Sabha
(B) both Lok Sabha and Rajya Sabha
(C) both Houses of Parliament and given assent to by the President
(D) both Houses of Parliament and given assent to by the Prime Minister/ Finance Minister
(C)
3) Part-I of Schedule I of the Finance Act, 2006 has given the rates of Income- tax for
(A) 2006-07
(B) 2007-08
(C) 2008-09
4) Part-II of Schedule I of the Finance Act, 2006 has given the rates of tax
financial year:
(A) 2005-06
(B) 2006-07
(C) 2007-08
5) Part-III of Schedule I of the Finance Act, 2006 has given the rates of advance
case of salary for the assessment year:
(A) 2006-07
(B) 2007-08
(C) 2008-09

the assessment year:

(A)
deductible at source for the

(B)
tax and tax to be deducted in

(B)
6) The circulars issued by CBDT are binding on:
(A) Assessee
(B) Income-tax authorities
(C) Both the above
(B)
7) AOP should consist of:
(A) individuals only
(B) persons other than individuals only
(C) both the above
(C)
8) Body of individuals should consist of:
(A) individuals only
(B) persons other than individuals only
(C) both the above
(A)
9) A new business was set up on 15.10.2006 and it commenced its business from
previous year in this case shall be:
(A) 15.10.2006 to 31.03.2007
(B) 01.12.2006 to 31.03.2007
(C) 2006-07
10) A person leaves India permanently on 15.11.2006.
15.11.2006 in this case shall be:
(A) 2005-06
(B) 2006-07
(C) 2007-08

The assessment year for

11) There is a a surcharge on income-tax if the total income of the assessment year
or HUF exceeds:
(A) Rs.1,00,000
(B) Rs.10,00,000
(C) Rs.8,50,000

1.12.2006. The first

(A)
income earned till

(B)
2007-08 of an individual

(B)

12) Surcharge in case of an individual or HUF for assessment year 2007-08 is


payable at the rate of:
(A) 2.5 % of the income-tax payable provided the total income exceeds
Rs.10,00,000
(B) 10 % of the income-tax payable provided the total income exceeds
Rs.10,00,000
(C) 5 % of the income-tax payable if the total income exceeds
Rs.10,00,000
(B)
13) Surcharge in case of a firm for assessment year 2007-08 is payable at the rate:
(A) 10 % of income-tax payable
(B) 10 % of income-tax payable provided the income exceeds Rs.60,000
(C) 2.5 % of income-tax payable
(A)
14) Surcharge on income-tax is payable by:
(A) All assessees except a foreign company
(B) Individual and HUF only
(C) A Domestic Company
(D) All assessees except local authority or co-operative society
(E) All assessees
(D)
15) The maximum amount on which income-tax is not chargeable in case of HUF
for assessment year 200708 is:
(A) Rs.50,000
(B) Rs.1,00,000
(C) Rs.1,35,000
(B)
16) The maximum amount on which income-tax is not chargeable for the
assessment year 2007-08 of an
individual other than a woman or an individual
less than 65 years old is:
(A) Rs.50,000
(B) Rs.1,00,000
(C) Rs.1,35,000
(D) Rs.1,50,000
(B)
17) The maximum amount on which income-tax is not chargeable for the
assessment year 2007-08 in
case of a woman who is less than 65 years old is:
(A) Rs.1,00,000
(B) Rs.1,35,000
(C) Rs.1,85,000
(D) Rs.1,50,000
(B)
18) The maximum amount on which income-tax is not chargeable for the
assessment year 2007-08 in case
of an individual who is resident in India and
65 years old is:
(A) Rs.1,00,000
(B) Rs.1,35,000
(C) Rs.1,85,000
(D) Rs.2,50,000
(C)
19) The maximum amount on which income-tax is not chargeable in case of a firm
is:
(A) Rs.50,000
(B) Rs.30,000
(C) Rs.60,000
(D) NIL
(D)
20) The maximum amount on which income-tax is not chargeable in case of a
co-operative society is:
(A) Rs.50,000
(B) Rs.30,000
(C) Rs.NIL
(C)
21) Education cess is leviable on:
(A) Income-tax
(B) Income-tax + surcharge
(C) Surcharge
(B)
22) Education cess is leviable @:
(A) 2 %
(B) 5 %
(C) 2.5 %
(A)

23) Education cess is leviable in case of:


(A) an individual assessee only
(B) an individual and HUF
(C) a company assessee only
(D) all assessees
(E) all assessees except co-operative society or local authority
(D)
total income of such

24) In case of an individual and HUF education cess is leviable only when the
assessee:
(A) Exceeds Rs.10,00.000
(B) Whether it is less than or exceeds Rs.10,00,000

(B)
25) For the assessment year 2007-08, a firm is subject to income-tax at a flat rate
(A) 35 % + education cess @ 2 %
(B) 35 % + 10 % surcharge + education cess @ 2 %
(C) 30 % + 10 % surcharge + education cess @ 2 %
(D) 30 % + 2.5 % surcharge + education cess @ 2 %

of:

26) The total income of the assessee has been computed at Rs.1,53,494.90. For
income will be taken as:
(A) Rs.1,53,500
(B) Rs.1,53,490
(C) Rs.1,53,495
27) The total income of the assessee has been computed as Rs.1,53,499. For
will be taken as:
(A) Rs.1,53,500
(B) Rs.1,53,490
(C) Rs.1,53,495

(C)
rounding off, the total

(B)
rounding of the total income

(A)
28) Income-tax is rounded off to:
(A) nearest ten rupees
(B) nearest one rupee
(C) no rounding off of tax is done
29) A is 60 years old. His total income for the assessment year 2007-08 is
shall be:
(A) Rs.5,100
(B) Rs.5,000
(C) Rs.5,500
(D) Rs.5,610

(A)
Rs.1,50,000. His tax liability

(A)
30) A is 66 years old. His total income for the assessment year 2007-08 is
Rs.2,50,000. His tax liability
shall be:
(A) Rs.25,500
(B) Rs.21,930
(C) Rs.13,260
(D) Rs.14,586
(C)
31) Mrs. A is 60 years old. Her total income for the assessment year 2007-08 is
Rs.2,00,000. Her tax
liability shall be:
(A) Rs.15,300
(B) Rs.11,730
(C) Rs.3,060
(D) Rs.13,093
(B)
32) Mrs. A is 65 years old. Her total income for the assessment year 2007-08 is
Rs.3,00,000. Her tax
liability shall be:
(A) Rs.40,800
(B) Rs.37,320
(C) Rs.28,560
(C)
33) As total income for the assessment year 2007-08 is Rs.10,30,000. His tax
liability shall be:
(A) Rs.2,84,900
(B) Rs.2,80,000
(C) Rs.2,85,600 (D) Rs.2,90,600
(D)

34) Residential status is to be determined for:


(A) previous year
(B) assessment year
(C) accounting year
35) Incomes which accrue or arise outside India but are received directly into
(A) resident only
(B) both ordinarily resident and not ordinarily resident
(C) non-resident
(D) all the assessees

(A)
India are taxable in case of:

(D)
36) Income deemed to accrue or arise in India is taxable in case of:
(A) resident only
(B) both ordinarily resident and not ordinarily resident
(C) non-resident
(D) all the assessees
37) Income which accrue or arise outside India from a business controlled from
(A) resident only
(B) non-resident only
(C) both ordinarily resident and not ordinarily resident
(D) non-resident
(E) all the assessees

(D)
India is taxable in case of:

(C)
38) Income which accrue or arise outside India and also received outside India is
(A) resident only
(B) non-resident only
(C) both ordinarily and not ordinarily resident
(D) none of the above

taxable in case of:

(A)
39) Total income of a person is determined on the basis of his:
(A) residential status in India
(B) citizenship in India
(C) none of the above
(d) both of the above
(A)
40) R was born on 5th April, 1995 in India & he later on took the citizenship of
U.S.A. Neither his parents
nor his grand parents were born in divided/
undivided India. R in this case shall be:
(A) citizen of India
(B) person of Indian origin
(C) a foreign national
(C)
41) R was born in England. His parents were born in India in 1951. His grand
parents were born in South
Africa. R shall be:
(A) a person of Indian origin
(B) a foreign national
(C) none of these
(B)
42) R was born in India in 1995. His father was born in India in 1949 and his
mother was born in
England. His grand father was born in England & his
grand mother was born in South Africa. The
parents of R along with R
took the citizenship of England. R is:
(A) citizen of India
(B) person of Indian origin
(C) none of these
(C)
43) R was born in India in 1995. His parents were born in India in 1951. His
grand father was born in
Lahore in 1936 but his grand mother was born in
England in 1940. R will be:
(A) a citizen of India
(B) a person of Indian origin
(C) none of these
(A)
44) R was born in India in 1995. His parents were born in India in 1951. The
parents of R along with
R have taken the citizenship of England. His grand
father was born in Lahore in 1936 but his grand mother
was born in England
in 1940. R will be:
(A) a citizen of Indian
(B) person of Indian origin
(C) none of these
(B)

45) R, a person of Indian origin visited India on 2.10.2006 and plans to stay here
for 185 days. During 4
years prior to previous year 2006-07, he was in India
for 750 days. Earlier to that he was never in India.
For assessment year
2007-08, R shall be:
(A) resident and ordinarily resident in India
(B) resident but not ordinarily resident in India
(C) non-resident
(C)
46) R, a citizen of India left India for U.S. on 16.08.2006 for booking orders on
behalf of an Indian
Company for exporting goods to U.S. He came back to
India on 5.5.2007. He had been resident in India for
the past 10 years. For
assessment year 2007-08, R shall be:
(A) resident and ordinarily resident in India
(B) resident but not ordinarily resident in India
(C) non-resident in India
(A)
47) R, a citizen of India is employed on an Indian Ship. During the previous
year 2006-07 he leaves India
for Germany on 15.09.2006 for holidays and
returned on 1.4.2007. He had been non-resident for the past 3
years. Earlier
to that he was permanently in India. For assessment year 2007-08, R shall be:
(A) resident and ordinarily resident in India
(B) resident but not ordinarily resident in India
(C) non-resident in India
(A)
48) R Ltd., is an Indian Company the entire control and management of its
affairs is situated outside
India. R Ltd., shall be:
(A) resident in India
(B) non-resident in India
(C) not ordinarily resident in India
(A)
49) R Ltd., is registered in U.K. The control and management of its affairs is
wholly situated in India. R
Ltd., shall be:
(A) resident in India
(B) non-resident in India
(C) not ordinarily resident in India
(A)
50) R, a foreign national visited India during the previous year 2006-07 for 180
days. Earlier to this he
never visited India. R in this case shall be:
(A) resident in India
(B) non-resident in India
(C) not ordinarily resident in India
(B)
51) R, a foreign national but a person of Indian origin visited India during the previous year 2006-0 for 182
days. During 4 preceding previous years he was
in India for 400 days, R shall be:
(A) resident in India
(B) non-resident in India
(C) not ordinarily resident in India
(B)
52) Dividend paid by an Indian Company outside India is:
(A) taxable in India in the hands of the recipient
(B) exempt in the hands of the recipient
(C) taxable in the hands of the company and exempt in the hands of the recipient
(C)
53) Any receipt by a member of HUF from the HUF shall be:
(A) Fully taxable
(B) Fully exempt
(C) Included in the total income of the member for rate purpose
(B)
54) In the case of a partner, the share of the profits from the firm shall be:
(A) fully taxable
(B) fully exempt
(C) included in the total income of the partner and relief of income-tax u/s 86 shall be allowed
(B)
55) Casual income received by the assessee is:
(A) fully exempt
(B) exempt up to Rs.5,000
(C) fully taxable
(C)
56) A cricket match organised by the Cricket Control Board of India for the
benefit of Sunil Gavaskar
where he received Rs.5 lakh is:

57)

(A) Casual income


(B) Exempt income
(C) Fully taxable
(B)
R traced a missing person and was awarded a sum of Rs.1,00,000 although there was no stipulation to
that effect. Such receipt shall be:
(A) casual income and fully taxable
(B) casual income and exempt up to Rs.5,000
(C) fully exempt

(A)
58) An award of Rs.1,00,000 was announced for tracing a missing person. R traced the person and received
the award amount. Such receipt shall be:
(A) casual income
(B) fully exempt
(C) fully taxable
(C)
59) Scholarship received by a student to meet the cost of education is:
(A) casual income
(B) fully taxable
(C) fully exempt
(C)
60) Scholarship received by a student was Rs.1,000 p.m. He spends Rs.8,000 for meeting the cost of
education. The balance Rs.4,000 is:
(A) taxable
(B) a casual income
(C) exempt
(C)
61) An author was awarded by Central Board of Direct Taxes a sum of Rs.50,000 for writing a book in Hindi
as first prize. Such award is:
(A) casual income
(B) fully exempt
(C) fully taxable
(B)
62) A local authority has earned income from the supply of water or electricity outside its own jurisdictional
area. Such income is:
(A) exempt
(B) taxable
(C) casual income
(A)
63) A local authority has earned income from the supply of commodities outside its own jurisdictional area.
Such income is:
(A) exempt
(B) taxable
(A)
64) An income under the head capital gain to a local authority is:
(A) exempt
(B) taxable
(A)
65) An income under the head capital gain to a trade union is:
(A) exempt
(B) taxable
(B)
66) A subsidy received from the Tea Board by an assessee carrying on business of growing and manufacturing
tea for re-plantation or replacement of tea bushes
is:
(A) taxable
(B) exempt
(B)
67) The daily allowance received by a Member of Parliament is:
(A) exempt
(B) taxable
(C) included in total income for rate purposes
(A)
68) The daily allowance received by an MLA is:
(A) exempt
(B) taxable

(C) included in total income for rate purposes


(D) Exempt up to Rs.2,000
(A)
69) The constituency allowance received is:
(A) fully exempt in the hands of MLAs only
(B) fully exempt in the hands of both MLAs and MLCs
(C) exempt up to Rs.2,000 p.m. in the hands of MLAs and MLCs
(B)
70) Dividend received by a company from a domestic company is:
(A) exempt
(B) taxable
(A)
71) Dividend received by a foreign company from a domestic company is:
(A) exempt
(B) taxable
(B)
72) Subsidy received by the assessee from Rubber Board for re-plantation or replacement of rubber plant is:
(A) exempt
(B) taxable
(A)
73) Income arising from the transfer of units of the Unit Trust of India or of mutual fund covered under
section 10(23D) shall:
(A) be exempt
(B) not be exempt
(B)
74) Any sum received under a Life Insurance Policy including bonus shall be exempt:
(A) in all kinds of policies
(B) in all kinds of policies except when received under a Keyman Insurance Policy
(C) in all kinds of policies except when received under Keyman Insurance Policy or under a
policy covered under section 80DDA(3)
(D) in all kinds of policies except when received under Keyman Insurance Policy or such policy as
is covered under section 80DD(3) or policy issued on or after 1.4.2003, if the premium paid
for any year exceeds 20 % of actual sum assured, except on death
(D)
75) Any pension received by an individual or family pension received by an individual or family pension
received by any member of his family where such individual is in the service of Central or State Government
and was awarded Paramvir Chakra, Mahavir Chakra or Vir Chakra or any other notified gallantry award shall
be:
(A) exempt
(B) taxable
(A)
76) Venture capital company or venture capital fund are given exemption from income-tax for:
(A) any income by way of dividend or long-term capital gain from investments made by way of
equity shares in a venture capital undertaking
(B) any income from investment in a venture capital undertaking
(C) any income wherever invested
(B)
77) Where a venture capital company or venture capital funds makes any
investment in a venture
capital undertaking then its:
(A) any income from investment in venture capital undertaking shall be
exempt
(B) dividend income shall be exempt
(C) interest income from such investment shall be exempt
(A)
78) Where the income of an individual includes the income of minor children,
such individual shall be
entitled to an exemption of:
(A) Rs.1,500
(B) Rs.1,500 per minor child
(C) Rs.1,500 per minor child to the extent of income of the minor child
included in
the total income of the assessee whichever is less
(C)
79) Income of newly Established undertaking in a Free Trade Zone is:
(A) exempt
(B) exempt for 5 years in a block of eight assessment years
(C) exempt for 10 years but not beyond assessment year 2009-10
(C)
80) Income from units of UTI or Mutual Fund covered under section 10(23D)
shall be:

(A) exempt
(B) taxable
81) Family pension received by the legal heir of army personnel who died
shall be:
(A) fully exempt
(B) taxable

(A)
during operational duties

(A)
82) Capital gain arising from compulsory acquisition of urban agricultural land
(A) taxable
(B) exempt
(C) exempt if certain conditions are satisfied

shall be:

(C)
83) Any capital gain whether short-term or long-term shall be exempt if:
(A) it is from the transfer of urban agricultural land
(B) it is from the compulsory acquisition by law or urban agricultural land
(B)
84) Income from long-term capital gain from transfer of equity shares shall be
exempt if:
(A) such shares are sold through National Stock Exchange
(B) such shares are sold through any Recognised Stock Exchange in India
(C) such shares are sold through any Recognised Stock Exchange in India
transaction is subject to Securities Transactions Tax
85) In case of an individual, any income by way of interest on any money standing
Resident (External) Account in any bank in India shall
be
(A) exempt
(B) fully taxable
(C) exempt up to Rs.13,000

and such

(C)
to his credit in a Non-

(A)
86) R, a chartered accountant is employed with R Ltd., as an internal auditor and
requests the employer to
call the remuneration as internal audit fee. R shall
be chargeable to tax for such fee under the head:
(A) Income from salaries
(B) Profits and gains from Business or Profession
(C) Income from other sources
(A)
87) R Ltd., pays a salary of Rs.1,50,000 to his employee G and undertakes to pay
the Income Tax
amounting to Rs.5,100 during the previous year 2006-07 on
behalf of G. The gross salary of G shall be:
(A) Rs.1,50,000
(B) Rs.1,55,100
(C) Rs.1,55,600
(B)
88) R was employed on 1.4.2000 in the grade of Rs.15,000-400-17,000-50022,000. His gross salary for
the assessment year 2007-08 shall be:
(A) Rs.1,99,200
(B) Rs.2,04,000
(C) Rs.2,10,000
(D) Rs.2,16,000
(C)
89) R was employed from 1.8.2004 in the grade of Rs.15,000-400-17,000500-22,000 and his salary
was fixed at Rs.16,600 from the date of joining. His
gross salary for the assessment year 2007-08 shall be:
(A) Rs.1,99,200
(B) Rs.2,04,000
(C) Rs.2,08,000
(D) Rs.2,10,000
(C)

90) R, who is entitled to a Salary of Rs.10,000 p.m., took an advance of


Rs.20,000 against the salary in
the month of March 2007. The gross salary of
R for the assessment year 2007-08 shall be:
(A) Rs.1,40,000
(B) Rs.1,20,000

(C) None of these two


(B)
91) R, who is entitled to Salary of Rs.10,000 p.m., took advance salary from his
employer for the months
of April and May 2007 along with salary for March
2007 on 31.03.2007. The gross salary of R for
assessment year 2007-08
shall be:
(A) Rs.1,20,000
(B) Rs.1,40,000
(C) None of these two
(B)
92) R is employed with G Ltd., at a salary of Rs.10,000 p.m. As G Ltd., was in
financial crisis, it paid the
salary of January 2007 to March 2007 to R only in
July 2007. The gross salary of R for the assessment
year 2007-08 shall be:
(A) Rs.1,20,000
(B) Rs.90,000
(C) None of these two
(A)
93) Salary of R is Rs.10,000 p.m. R had taken Salary in advance for the
months of April 2006 to June
2006 in March 2006 itself. The gross salary of
R for the assessment year 2007-08 shall be:
(A) Rs.1,20,000
(B) Rs.90,000
(C) None of these two
(B)
94) Salary of R becomes due on 1 st of next month and it is paid on 7 th of that
month. For assessment year
2007-08, the salary of R shall be taken from:
(A) April 2006 to March 2007
(B) March 2006 to February 2007
(C) None of these
(B)
95) R who was working with another company joined the present employer
w.e.f. 1.5.2006 at a Salary of
Rs.10,000 p.m. His salary becomes due on first
of next month. He was also entitled to a pension of
Rs.4,000 p.m. from his
former employer. His gross salary for the assessment year 2007-08 shall be:
(A) Rs.1,10,000
(B) Rs.1,58,000
(C) Rs.1,48,000
(C)
96) The Government of India announced increase in the D.A. on 15.03.2006 with
retrospective effect from
1.5.2002 and the same were paid on6.4.2006. The
arrears of D.A. shall be taxable in the previous year:
(A) 2005-06
(B) 2006-07
(C) in respective previous years to which these relate
(B)

97) Gratuity shall be fully exempt in the case of:


(A) Central and State Government employee
(B) Central and State Government employees and employees of local authorities
(C) Central and State Government employees and employees of local authorities and employees
of statutory corporation
(B)
98) An employee is covered under Payment of Gratuity Act, 1972
(i) Salary for the purpose of calculating 15 days salary for each completed
year of service
shall be:
(A) last drawn Salary
(B) average Salary of last 10 months
(C) average Salary of last 3 completed years
(A)
(ii) Salary for the above purpose shall:
(A) include dearness allowance
(B) not include dearness allowance
(C) include dearness allowance to the extent the terms of employment provide
(A)
(iii) If the employee has completed service of 16 years 6 months and 5 days,
the number of
completed years shall be taken as:
(A) 16 years
(B) 17 years
(C) 16 years 6 months and 5 days

(B)
(iv) If he has completed exactly 16 years and 6 months, the completed year
(A) 16 years
(B) 17 years
(C) 16 years and 6 months
(v) For the purpose of computing 15 days salary, the number of days in a

shall be:

(A)
month shall be taken

as:
(A) 30 days
(B) 26 days
(C) 31 days
(B)
(vi) The maximum exemption of gratuity shall be:
(A) Rs.2,40,000
(B) Rs.2,50,000
(C) Rs.3,50,000
(D) Twenty months Salary
(C)
99) An employee is neither a Government employee nor covered under Payment
(i) Salary for the purpose of calculating half month shall be taken as:
(A) last drawn salary
(B) average salary of 10 months preceding the month of retirement
(C) average salary of each completed year

of Gratuity Act, 1972.

(B)
(ii) Salary for the above purpose shall:
(A) include dearness allowance
(B) not include dearness allowance
(C) include dearness allowance to the extent the terms of employment so provide
(C)
(iii) If the employee has completed 16 years and 8 months of service, the
number of completed
years shall be taken as:
(A) 17 years
(B) 16 years
(C) 16 years and 8 months
(B)
(iv) The maximum exemption of gratuity shall be:
(A) Rs.2,40,000
(B) Rs.2,50,000
(C) Rs.3,50,000
(D) 20 months salary
(C)
100) R who claimed the exemption of gratuity in the post to the extent of
Rs.2,50,000, was entitled to the
gratuity from the present/second employer
amounting to Rs.2,00,000 in the previous year 2006-07. R
shall be entitled
to exemption to the maximum extent of:
(A) Rs.2,00,000
(B) NIL
(C) Rs.1,00,000
(C)
101) R worked with a previous employer for 3 years but was not entitled to any
gratuity. He worked
with the present employer for 8 years and 7 months.
The completed years of service for calculating
exemption of gratuity shall be
taken as:
(A) 11 years
(B) 8 years
(C) 9 years
(D) 12 years
(A)
102) For the purpose of calculating exemption of gratuity, salary shall include:
(A) fixed commission
(B) commission if it is a fixed percentage on turnover
(C) none of these two
(B)
103) Pension received by a Government employee is:
(A) exempt
(B) taxable
(C) partially taxable
(B)

104) Commuted pension received shall be fully exempt in case of:


(A) Government employee
(B) Government employee or an employee of local authority
(C) Government employee or an employee of local authority or an
statutory corporation

employee of

(C)
105) (i) An employee was also entitled to gratuity. He got 60 % of his pension
commuted and received
a sum of Rs.1,20,000 as commuted pension. The
exemption in his case shall be:
(A) Rs.1,20,000
(B) Rs.40,000
(C) Rs.66,667
(D) 80,000
(C)
(ii) What shall be the exemption if he was not entitled to gratuity in the above
case?
(A) Rs.1,20,000
(B) Rs.40,000
(C) Rs.66,667
(D) Rs.1,00,000
(D)
106) An employee who was not entitled to gratuity, got 30 % of his total pension
commuted in the past.
He wishes to commute another 25 % of his total
pension in the previous year. He shall be allowed
exemption to the extent of:
(A) NIL
(B) 20 %
(C) 25 %
(B)
107) Encashment of leave salary at the time of retirement is fully exempt in the
case of:
(A) Central Government Employee
(B) State Government Employee
(C) Both Central and State Government Employees
(D) Government employee and employees of local authority
(C)
108) Salary for exemption of leave encashment shall be taken as:
(A) last drawn salary
(B) average salary of 10 months immediately preceding the month of
retirement
(C) average salary of 10 months immediately preceding the date of
retirement
(C)
109) The maximum exemption in case of leave encashment shall be:
(A) Rs.2,40,000
(B) Rs.3,50,000
(C) Rs.3,00,000
(C)
110) An employee availed the exemption of leave encashment of Rs.1,00,000 in the
past. He received
from the second employer a sum of Rs.2,50,000 as
encashment of leave. He will be entitled to
exemption to the extent of:
(A) NIL
(B) Rs.2,50,000
(C) Rs.2,00,000
(D) Rs.1,40,000
(C)
111) Compensation received on voluntary retirement is exempt under section 10(10C) to the maximum extent
of:
(A) Rs.2,40,000
(B) Rs.3,50,000
(C) Rs.5,00,000
(C)
112) (i) If rent is paid for a house situated in Delhi, the house rent allowance shall be exempt to the maximum
extent of:
(A) 40 % of salary
(B) 50 % of salary
(C) 60 % of salary
(B)
(ii) What shall be the exemption if the rent is paid for a house in Ghaziabad.
(A) 40 % of salary
(B) 50 % of salary
(C) 60 % of salary

113) A is entitled to children education allowance @ Rs.80 p.m. per child for 3
Rs.240 p.m. It will be exempt to the extent of:
(A) Rs.200 p.m.
(B) Rs.160 p.m.
(C) Rs.240 p.m.
114) R is entitled to Hostel expenditure allowance of Rs.600 p.m. for his 3
The exemption in this case shall be:
(A) Rs.600 p.m.
(B) Rs.400 p.m.
(C) Rs.300 p.m.

(A)
children amounting to

(B)
children @ Rs.200 per child.

115) R is entitled to a transport allowance of Rs.1,000 p.m. for commuting from


and back. He spends Rs.600 p.m. The exemption shall
be:
(A) Rs.1,000 p.m.
(B) Rs.800 p.m.
(C) Rs.600 p.m.

(B)
his residence to office

(B)
116) R is entitled to Rs.6,000 as medical allowance. He spends Rs.4,000 on his
medical treatment and
Rs.1,000 on the medical treatment of his major son not
dependent on him. The exemption in this case
shall be:
(A) Rs.4,000
(B) Rs.5,000
(C) Rs.NIL
(C)
117) R is an employee of a Transport Company. He is entitled to transport
allowance of Rs.6,000 p.m.
He spends Rs.4,000 every month. The
exemption shall be:
(A) Rs.6,000 p.m.
(B) Rs.4,000 p.m.
(C) Rs.4,200
(C)
118) Entertainment allowance in case of Government employee is:
(A) fully exempt
(B) fully taxable
(C) exempt up to certain limits mentioned in section 16(ii)
(D) first included in full gross salary and thereafter deduction allowed from
salary under section 16(ii)

gross

(D)
119) For claiming deduction of entertainment allowance Government employee
includes:
(A) Central and State Government employee
(B) State Government employee
(C) Central and State Government employees and employees of local
authority
(D) Central and State Government employees, employees of local authority
and
employees of statutory corporation
(A)
120) During the previous year, the employee was reimbursed Rs.24,000 as medical
expenses incurred by
him which includes Rs.7,000 spent in Government
hospital. The taxable perquisite in this case shall be:
(A) Rs.9,000
(B) Rs.NIL
(C) Rs.2,000
(D) Rs.24,000
(C)
121) Mrs. R, wife of R who is employed in G Ltd. went for bypass surgery in
England along with her
husband. Expenses on medical treatment of wife and
stay outside India of wife and R amounted to
Rs.7,00,000 as against
Rs.6,50,000 permitted by RBI. The travel expenses amounted to Rs.1,50,000.
All expenses were reimbursed by the employer. Assume the gross salary and
income from other
sources of the employee are Rs.1,40,000 and Rs.40,000
respectively. The taxable perquisite in this case
shall be:
(A) Rs.NIL
(B) Rs.50,000
(C) Rs.2,00,000
(D) Rs.1,50,000
(C)
122) Leave travel concession is a tax free perquisite:
(A) for one journey in a block of 4 years

(B)
(C)

one journey per year


two journeys in a block of 4 years

123) Salary of employee is Rs.2,00,000. Fair rent of the unfurnished house given
Rs.1,30,000. The valuation of the perquisite of the house
(i) In case of Government Employee shall be:
(A) Rs.20,000
(B) License fee determined by the Government
(C) Rs.50,000
(D) Rs.1,30,000

(C)
to employee is

(B)
(ii) In case of any other employee:
(A) Rs.40,000
(B) Rs.20,000
(C) Rs.1,30,000
124) The employee is provided with furniture costing Rs.1,50,000 along with house
value of the furniture to be included in the valuation of
unfurnished house shall be:
(A) Rs.15,000
(B) Rs.12,500
(C) Rs.18,750
(D) Rs.22,500

(A)
w.e.f. 1.4.2006. The

(A)
125) Salary of an employee is Rs.2,00,000. Rent paid by the employer for the
unfurnished house
provided to employee at Moradabad is Rs.3,000 p.m. The
employer charges Rs.2,000 p.m. as rent from
the employee. The valuation of
this perquisite shall be:
(A) Rs.16,000
(B) Rs.12,000
(C) Rs.NIL
(B)
126) A car of 1500 CC is provided by the employer to the employee whose salary
is Rs.20,000 p.m. The
car is used by him partly for official and partly for his
personal purposes. The expenses of running and
maintenance for official
purpose are met by the employer and the expenses of running and maintenance
for private use is met by employee himself. The valuation of this perquisite
shall be:
(A) Rs.NIL
(B) Rs.1,200 p.m.
(C) Rs.400 p.m.
(A)
127) An employer has provided a motor car of 1.5 litre capacity to his employee
which the employee is
allowed to use for official purpose and for travelling
from office to residence and back. The expenses of
running and maintenance
of Motor Car are met by the employer. The value of this perquisite shall be:
(A) Rs.1,200 p.m.
(B) Rs.400 p.m.
(C) Rs.NIL
(D) Rs.1,600 p.m.
(C)
128) R is provided with a car of 1.6 litre capacity by the employer along with
driver. The expenses of
running and maintenance of car are met by R
himself. Besides using the car for official purposes, R uses
the car for his
personal purposes also. The valuation of the perquisite of car shall be:
(A) NIL
(B) Rs.12,000
(C) Rs.8,000
(D) Rs.10,400
(A)
129) R an employee owns a car which he uses for his private as well as official
purposes. The expense
of running and maintenance of the car is met by the
employer. The perquisite shall:
(A) be taxable in case of specified employee only
(B) be taxable in case of an employee other than specified employees
(C) be taxable in case of specified and non-specified employee
(D) not be taxable
(D)
130) R is an employee of Indian Oil Corporation Ltd. He is provided with free gas
for his personal
purposes by the employer. The value of this perquisite shall
be:
(A) NIL
(B) 6 1/4 % of the salary

(C) Manufacturing cost per unit


(D) Market rate of gas
131) R owns a house in which he lives. His employer reimburses to him the
Rs.5,000. It shall be a perquisite for:
(A) specified employees only
(B) employee other than specified employees
(C) both specified and other employees

(C)
electricity bill amounting to

(C)
132) An employer provides free facility of gas, electricity to his employee which he
uses partly for Official
and partly for his personal purposes. The actual
amount spent by the employee is Rs.10,000 and the salary
of the employer is
Rs.2,00,000. The valuation of this perquisite shall be:
(A) Rs.10,000
(B) Rs.6,250
(C) Proportionate amount for personal use
(C)
133) The employer provides free facility of watchman, Sweeper and Gardener to
his employees. It will be
a perquisite for:
(A) specified employee only
(B) employees other than specified employees
(C) specified as well as other employees
(A)
134) The valuation of the perquisite in the above case shall be:
(A) actual wages paid to each servant
(B) Rs.120 p.m. per servant
(C) Rs.60 p.m.
(A)
135) R Ltd., provides the facility of cook to its employee for which it paid Rs.1,000
p.m. as salary to the
cook. The valuation of this perquisite shall be:
(A) Rs.120 p.m.
(B) Rs.1,000 p.m.
(C) Rs.60 p.m.
(B)
136) The Gardener, Sweeper and the Watchman are employed by the employee but
their salary of Rs.500
p.m. per person is paid by the employer. The valuation
of their perquisite shall be:
(A) Rs.4,320
(B) Rs.18,000
(C) Rs.1,960
(B)
137) R Ltd., own a house which has been provided to its employee along with the
Gardener. The
Gardeners salary paid shall be:
(A) tax free perquisite
(B) taxable to the extent of Rs.120 p.m.
(C) fully taxable
(D) tax-free perquisite but will be added to the fair rental value
(C)
138) Employers contribution to statutory fund shall be:
(A) fully exempt
(B) exempt up to 12 % of salary
(C) exempt up to 10 % of salary
(A)
139) Interest credited to statutory provident fund shall be:
(A) fully exempt
(B) exempt up to 12 % p.a.
(C) fully taxable
(D) exempt up to 9.5 % p.a.
(A)
140) Employers contribution to recognized provident fund shall be:
(A) fully exempt
(B) fully taxable
(C) exempt up to 12 % of salary
(C)
141) Interest credited to recognized provident fund shall be:
(A) fully exempt
(B) fully taxable
(C) exempt up to 9.5 %

(D) exempt up to 12 %
(C)
142) Employers contribution to unrecognized provident fund shall be:
(A) fully taxable
(B) fully exempt
(C) exempt up to 12 % of salary
(D) neither exempt nor taxable in the year of contribution
(D)
143) Interest credited to unrecognized provident fund shall be:
(A) fully taxable
(B) fully exempt
(C) exempt up to 9.5 % of salary
(D) neither exempt nor taxable in the year of accrual
144) Employees/assessees own contribution to statutory provident fund or
public provident fund shall be subject to:
(A) deduction under section 80C
(B) deduction under section 80CCC
(C) deduction under section 16 from gross salary
(D) rebate under section 88

(D)
recognized provident fund or

(A)
145) Employees contribution to unrecognized fund shall be subject to:
(A) deduction u/s 80C
(B) deduction u/s 80CCC
(C) NIL deduction
(C)
146) Payment from statutory fund and public provident fund shall be:
(A) taxable
(B) fully exempt
(C) taxable to the extent of employers contribution and interest thereon
(B)
147) Payment from recognized provident fund after 5 years of service shall be:
(A) taxable
(B) fully exempt
(C) taxable to the extent of employers contribution and interest thereon
(B)
148) Payment from recognized provident fund before 5 years shall be:
(A) fully taxable
(B) fully exempt
(C) shall be treated as if the fund was unrecognized right from the

beginning
(C)

149) Payment from unrecognized provident fund shall be:


(A) fully taxable
(B) fully exempt
(C) taxable to the extent of employers contribution and interest thereon
(D) same as (C) and the interest on employers contribution shall be
the head income from other sources

taxable under

(D)
150) The year in which unrecognized provident fund is recognized:
(A) the employers contribution till date and interest thereon shall be
taxable
(B) the employers contribution till date shall be taxable
(C) it will be assumed as if the provident fund was recognized right from
the
beginning and excess amount of employers contribution and
interest thereon shall be chargeable
to tax
(C)
151) R is entitled to a watchman allowance of Rs.600 p.m. for the security of his
residence. He pays
Rs.500 p.m. to the watchman employed by him. The
taxable allowance shall be:
(A) Rs.120 p.m.
(B) Rs.100 p.m.
(C) Rs.600 p.m.
(B)
152) (i) R is provided with a rent free accommodation owned by his employer in
this perquisite shall be:
(A) 20 % of salary
(B) 15 % of salary

Delhi. The value of

(C) 20 % of salary plus excess of FRV over 50 % of salary


(D) 20 % of salary plus excess of FRV over 60 % of salary
(E) 10 % of salary
(ii) What will be your answer if the accommodation is provided in a city
3,00,000 as per 1991 census?
153) (i) R is provided with a rent free accommodation in Delhi which has been
employer. The value of this perquisite shall be:
(A) 20 % of salary
(B) 20 % of salary or rent paid or payable whichever is less
(C) 15 % of salary
(D) 15 % of salary or rent paid or payable whichever is less
(ii) What shall be your answer if the accommodation is provided in a city having
3,00,000 as per 1991 census?
(A) 20 % of salary
(B) 20 % of salary or rent paid or payable whichever is lower
(C) 15 % of salary
(D) 15 % of salary or rent paid or payable whichever is less

(A)
having a population of
(B)
taken on rent by the

(B)
population of

(B)
154) (i) R is provided with interest free loan by the employer for purchase of a
house. The value of
this perquisite shall be determined as the sum equal to:
(A) simple interest computed @ 10 % p.a.
(B) simple interest computed @ 13 % p.a.
(C) simple interest computed at the rate charged by SBI on the 1 st of the
relevant
previous year on the maximum outstanding monthly balance
(D) simple interest computed at the rate charged by SBI on the last day of
the
relevant previous year on the maximum outstanding monthly
balance
(E) NIL
(C)
(ii) What shall be your answer if the loan is given for purchase of a car?
(C)
(iii) What shall be your answer if the loan is given for marriage of Rs Son?
(C)
(iv) What shall be your answer if the loan is given for medical treatment of
disease specified in
rule 3A?
(E)
(v) What shall be your answer if the amount of loan does not exceed
Rs.20,000 in
aggregate?
(E)
155) (i) Tea and snacks are provided to employees in the office during office hours.
The value of the
perquisite shall be:
(A) NIL
(B) NIL, if it up to Rs.50 per meal
(C) Actual amount spent by the employer
(A)
(ii) What will be your answer if tea and snacks are provided in the office after
office hours?
(A)
(iii) What will be your answer if instead of tea and snacks, meal is provided in
the office or
factory?
(A)
156) (i) The employer gives a gift (in kind) on the marriage of the Son of the
employee. Gift so made
shall not be perquisite if the value of the gift is:
(A) Rs.6,000 or less
(B) Below Rs.5,000
(C) Rs.10,000 or less
(D) Below Rs.10,000
(E) Any amount
(E)
(ii) What will be your answer if the gift is made to the employee on the silver
jubilee of the
company?
(E)
157) (i) The employer has a given a lap top computer for the personal use of the
employee. The value
of the perquisite shall be:
(A) NIL

(B)
(C)

10 % p.a. of the cost of the asset


10 % p.a. of the W.D.V. of the asset

(ii) What will be your answer if this lap top is given for the personal use of the
employee?
(iii) What will be your answer if instead of a computer a video camera is given
use of employer or any member of his house?

(A)
son of the
(A)
for the personal

(C)
158) (i) The employer has purchased a car for Rs.3,00,000 which was being used for
official purposes.
After 2 years and 6 months of its use, the car is sold to R,
the employee, for Rs.1,20,000. The value of
this perquisite shall be:
(A) Rs.72,000
(B) Rs.60,000
(C) NIL
(D) Rs.1,23,000
(E) Rs.1,20,000
(A)
(ii) What will be your answer if instead of a car, the asset purchased is a
computer?
(C)
(iii) What will be your answer if the asset is neither a car nor any computer?
(E)
159) R gifted his house property to his wife in 2001. Mrs. R has let out the house
property @ Rs.5,000
p.m. The income from such house property will be
taxable in the hands of:
(A) Mrs. R
(B) R. However, income will be computed first as Mrs. Rs income and
thereafter
clubbed in the income of R.
(C) R, as he will be treated as deemed owner and liable to tax
(C)
160) R gifted the house property to his minor son which was let out @ Rs.5,000
p.m. Income from such
house property shall be taxable in the hands of:
(A) Minor son
(B) R. However, it will be first computed as minors income and thereafter
clubbed
in the income of R
(C) R, as he will be the deemed owner of such house property and liable to
tax
(C)
161) R transferred his house property to his wife under an agreement to live apart.
Income from such
house property shall be taxable in the hands of:
(A) R as deemed owner
(B) R. However, it will be computed first as Mrs. Rs income and
thereafter
clubbed in the hands of R
(C) Mrs. R
(C)
162) (i) R has taken a house property on lease for 15 years from G and let out the
same to S. Income
from such house to R shall be taxable as:
(A) income under the head other sources
(B) income from house property as R is deemed owner
(B)
(ii) What shall be the answer if R had taken it on lease for 10 years.
(A)
163) R gifted his house property to his married minor daughter. The income from
such house property
shall be taxable in the hands of:
(A) R as deemed owner
(B) R. However, it will be first computed as minor daughters income and
clubbed
in the income of R
(C) income of married minor daughter
(B)
164) R is a member of house building Co-operative Society who is the owner of
flats constructed by it.
One of the flats is allotted to R. The income from such
house property shall be taxable in the hands of:
(A) Co-operative Society
(B) R as deemed owner
(B)
165) R is owner of superstructure although the land was taken by him on lease.
The income from such
house property shall be taxable under the head:
(A) income from other sources
(B) income from house property

166) R has taken a house on rent and sublets the same to G. Income from such
taxable under the head:
(A) income from house property
(B) income from other sources

(B)
house property shall be

(B)
167) Municipal valuation of the house is Rs.1,00,000; whereas the fair rent of
house property Rs.1,20,000
and standard rent is Rs.1,10,000; actual rent
received or receivable is Rs.1,40,000; municipal taxes paid
10 %. The annual
value in this case shall be:
(A) Rs.90,000
(B) Rs.1,00,000
(C) Rs.1,30,000
(C)
168) Municipal valuation of the house is Rs.1,20,000, fair rent is Rs.1,40,000;
standard rent is
Rs.1,30,000; whereas actual rent received or receivable is
Rs.1,25,000; municipal taxes paid are
Rs.40,000. The annual value in this
case shall be:
(A) Rs.1,00,000
(B) Rs.85,000
(C) Rs.90,000
(C)
169) Fair rental value of a house is Rs.1,50,000; standard rent Rs.1,20,000; actual
rent Rs.1,30,000.
Municipal taxes paid during the previous year for the past 7
years is Rs.1,40,000. The annual value shall
be:
(A) Rs.20,000
(B) Rs.NIL
(C) (-) Rs.10,000
(C)
170) A has two house properties. Both are self-occupied. The annual value:
(A) of both the houses shall be nil
(B) of one house shall be nil
(C) of no house shall be nil
(B)
171) If the annual value of the let house property is negative then tick the deduction
which shall be allowed
u/s 24.
(A) All deductions
(B) No deduction
(C) Deduction on account of interest of money borrowed
(C)
172) Municipal tax is a deduction from:
(A) Gross annual value
(B) Net annual value
(A)
173) In case the property is owned by co-owners and it is let, income from such
property shall be
computed:
(A) separately for each co-owner
(B) it will be first computed ignoring the co-ownership and then distributed
amongst co-owners
(B)
174) In case the property is owned by co-owners and it is self-occupied by all
the co-owners, the annual
value of:
(A) such house property
(B) for each co-owner shall be nil
(B)
175) In the above case, interest on money borrowed shall be allowed:
(A) to the extent of Rs.30,000/Rs.1,50,000 as the case may be
(B) to each owner to the extent of Rs.30,000/Rs.1,50,000 as the case may
be
(B)

176) (i) A borrowed Rs.5,00,000 @ 12 % p.a. pm 1.4.2002 for construction of


house property which
was completed on 15.03.2006. The amount is still
unpaid. The deduction of interest for previous
year 2006-07 shall be:
(A) Rs.60,000
(B) Rs.96,000
(C) Rs.1,80,000

(D) Rs.2,40,000
(B)
(ii) What shall be the amount of deduction if the house is completed on
(A) Rs.60,000
(B) Rs.96,000
(C) Rs.2,40,000
(D) Rs.1,08,000

2.4.2007.

(D)
177) (i) A borrowed a sum of Rs.5,00,000 @ 12 % p.a. on 1.4.1997 for
construction of a house
which was completed on 15.3.2002. What shall be
the amount of deduction allowed on account of
interest for the assessment
year 2007-08:
(A) Rs.96,000
(B) Rs.60,000
(C) Rs.1,08,000
(B)
(ii) What shall be the deduction if the loan is repaid on 31.08.2006?
(A) Rs.60,000
(B) Rs.25,000
(C) Rs.1,08,000
(B)
178) A house property whose fair rent is Rs.1,20,000 is neither let out nor
self-occupied throughout
the previous year. Its annual value shall be:
(A) Rs.1,20,000
(B) Rs.NIL
(A)
179) Unrealized rent is a deduction from:
(A) Gross annual value
(B) Net annual value
(C) Income from the head house property
(A)
180) An assessee was allowed deduction of unrealized rent to the extent of
Rs.40,000 in the past although
the total unrealized rent was Rs.60,000. He is
able to recover from the tenant Rs.45,000 during the
previous year on account
of such unrealized rent. He shall be liable to tax to the extent of:
(A) Rs.45,000
(B) Rs.NIL
(C) Rs.25,000
(C)
181) An assessee has borrowed money for purchase of a house and interest is
payable outside India. Such
interest shall:
(A) be allowed as deduction
(B) not be allowed as deduction
(C) be allowed as deduction if the tax is deducted at source
(C)
182) Salary, bonus, commission or remuneration due to or received by a working
partner from the firm is
taxable under the head:
(A) Income from salaries
(B) Income from other sources
(C) Income from business or profession
(C)
183) Perquisite received by the assessee during the course of carrying on his business
or profession is
taxable under the head.
(A) Salary
(B) Other sources
(C) Business or Profession
(C)
184) Export incentives received by an assessee are:
(A) exempt
(B) taxable under section 28
(C) exempt up to certain limits
(B)
185) Income of a trade or professional association, from specific services
performed for its members shall
be:
(A) exempt
(B) taxable u/H business and profession
(C) taxable u/H income from other sources
(B)

186) Interest on capital or loan received by a partner from a firm is:


(A) exempt u/s 10(2A)
(B) taxable u/H business and profession
(C) taxable u/H income from other sources
(D) taxable u/H business and profession on account of interest on capital
income from other sources on account of loan to the firm
187) Under the head Business & Profession, the method of accounting which an
be:
(A) Merchantile system only
(B) Cash system only
(C) Merchantile or Cash system only
(D) Hybrid system
(E) any of these systems

and

(B)
assessee can follow shall

(C)
188) For computation of business income, the assessee has to follow:
(A) Auditing standards prescribed by I.C.A.I.
(B) Accounting standards notified by the Central Government
(C) No accounting standards
189) Any sum received by an employer from Keyman insurance policy taken on
shall be:
(A) exempt
(B) taxable under the head business and profession
(C) taxable under the head other sources
(D) taxable in the hands of employee
190) R, who was carrying on agency business received a sum of Rs.5,00,000 from
termination of agency. Compensation amount so received
shall be:
(A) exempt as it is a capital receipt
(B) fully taxable under the head business and profession
(C) taxable under the head other sources

(B)
the life of the employee

(B)
his principal for

(B)
191) Where the machinery, plant and furniture is used by the assessee for the
purpose of carrying on
business and profession, he shall be entitled to
deduction under section 31 on account of:
(A) current repairs other than expenditure in the nature of capital
expenditure
(B) revenue and capital expenditure on repairs
(C) any repairs
(A)
192) Depreciation is allowed in case of:
(A) tangible assets only
(B) intangible assets only
(C) tangible and intangible assets
(C)
193) The depreciation is allowed to:
(A) the owner of asset
(B) owner including fractional owner of the asset
(C) lessee
(B)
194) Electricity companies are allowed depreciation on the basis of:
(A) block of asset
(B) each asset separately
(C) each asset separately unless the assessee opts for block of asset system
in the
first previous year of its commencement
(D) either on block of asset or each asset separately provided the option is
exercised in the first previous year.
(C)
195) (i) If the asset of a particular block is acquired and put to use during the
previous year for less
than 180 days, the assessee shall be entitled to
depreciation:
(A) at normal rate
(B) at 50 % of normal rate
(C) proportionate period for which it is first put to use.
(B)
(ii) What will be your answer in the above case if the asset is acquired by the
electricity
company which is claiming depreciation on straight line method:
(A) at normal rate

(B) at 50 % of normal rate


(C) proportionate period for which it is put to use
(B)
196) (i) W.D.V. of block of 15 % as on 1.4.2006 is Rs.5,00,000. An asset
amounting to Rs.1,00,000
was acquired on 1.11.2006 and put to use on
1.12.2006. During the previous year 2006-07 a part of
the block (other
than the new asset) is sold for Rs.5,40,000. The depreciation to be allowed
for this block is:
(A) Rs.9,000
(B) Rs.4,500
(C) Rs.5,000
(B)
(ii) In the above case, this part of the block is sold for Rs.4,80,000 instead of
Rs.5,40,000, the
depreciation allowed shall be:
(A) Rs.10,500
(B) Rs.18,000
(C) Rs.9,000
(A)
(iii) What will be your answer in case of (i) above if the part of the block sold
includes the new
asset acquired during the year:
(A) Rs.9,000
(B) Rs.4,500
(C) Rs.5,000
(A)
197) Where a part of block of assets is sold for a price more than the opening
W.D.V. plus cost of asset
acquired during the year, if any, the assessee shall
be subject to:
(A) balancing charge
(B) short-term capital gain
(C) short-term or long-term capital gain depending upon the period after
which the
block is transferred
(B)
198) Where a part of a block of asset is sold for a price less than the opening
W.D.V. plus cost of assets, if
any, acquired during the year, the balance
amount shall be treated as:
(A) Short-term capital loss
(B) terminal/balancing depreciation
(C) written down value for purpose of charging current year depreciation
(C)
199) Where the entire block of the asset is sold for a price more than the opening
W.D.V. and asset, if any,
acquired during the year, the excess amount shall be
subject to:
(A) balancing charge
(B) short-term capital gain
(C) long-term or short-term capital gain depending upon the period for
which block
is held
(B)
200) Where an electricity company claiming depreciation on straight line method
on each asset separately
sells such asset for a price more than its W.D.V. then
the excess amount shall be taxable:
(A) as short-term capital gain
(B) balancing charge under business head
(C) balancing charge to the extent of depreciation allowed in the past and
the
balance, if any, short-term capital gain
(D) balancing charge to the extent of depreciation allowed in the past and
the
balance, if any, long-term or short-term capital gain depending
upon the period for which such
asset was held
(D)
201) Where the entire block is sold for a price less than the opening W.D.V. and
the cost of asset, if any,
acquired during the previous year, the balance
amount shall be treated as:
(A) terminal/balancing depreciation
(B) short-term capital loss
(C) written down value
(D) short-term or long-term capital loss depending on the period for which
the
block was held
(B)
202) Where the electricity company charging depreciation on straight line method
on each asset separately,
sells any asset for a price less than the opening
W.D.V. the balance amount shall be treated as:
(A) short-term capital loss
(B) terminal depreciation
(C) written down value

(B)
203) R acquired an asset for Rs.5,22,000 which includes Rs.72,000 as excise duty
for which the assessee
has claimed CENVAT Credit. The actual cost of
acquisition to be included in the block of asset shall be:
(A) Rs.5,22,000
(B) Rs.4,50,000
(C) None of these two
(B)
204) An asset which was acquired for Rs.5,00,000 was earlier used for scientific
research. After the
research was completed the machinery was brought into
the business of the assessee. The actual cost of
the asset for the purpose of
inclusion in the block of asset shall be:
(A) Rs.5,00,000
(B) Rs.NIL
(C) market value of the asset on the date it was brought into business
(B)
205) R had been using an asset for his business and its W.D.V. as on 1.4.2006 was
Rs.3,50,000. He sold
this asset to G for Rs.5,00,000 and G leased back this
asset to R. The market value of this asset on the date
of sale was Rs.4,00,000;
in this case, the actual cost of this asset to G for charging depreciation shall be:
(A) Rs.5,00,000
(B) Rs.3,50,000
(C) Rs.4,00,000
(B)
206) A car is imported after 1.4.2006 by R Ltd., from London to be used by its
allowed depreciation on such car at:
(A) 15 %
(B) 20 %
(C) 40 %
207) Unabsorbed depreciation which could not be set off in the same assessment
forward for:
(A) 8 years
(B) indefinitely
(C) 4 years
208) Unabsorbed depreciation brought forward from an earlier year of a particular
from:
(A) the same business
(B) any head of income
(C) any business income
(D) any head of income but first from business income

employee. R Ltd. shall be

(A)
year can be carried

(B)
business can be set off

(D)
209) For claiming deduction for Tea Development, Coffee development or Rubber
development u/s 33AB
the assessee should deposit the money with NABARD
or in the Deposit Account:
(A) before the expiry of the previous year
(B) within six months from the end of the relevant previous year
(C) within six months from the end of the relevant previous year or before
the due
date of furnishing the return of income which ever is earlier
(D) before the due date of furnishing the return of income
(C)
210) Deduction of Tea/Coffee/Rubber Development Account shall be allowed to:
(A) any assessee
(B) a company assessee only who is engaged in the business of growing
and
manufacturing tea/coffee/rubber in India
(C) any assessee who is engaged in the business of growing and
manufacturing
tea/coffee/rubber in India
(D) any assessee who is engaged in the business of manufacturing
tea/coffee/rubber
in India
(C)
211) The maximum deduction to be allowed under Tea Development Account,
Coffee Development
Account or Rubber Development Account shall be:
(A) actual amount deposited in the scheme
(B) 20 % of the profits of such business
(C) 20 % of the amount deposited in the scheme
(D) 40 % of the profits of such business
(D)

212) For claiming deduction for Site Restoration Fund u/s 33ABA, the assessee
money with State Bank of India or Site Restoration
Account:
(A) before the end of the previous year
(B) before the expiry of six months from the end of the previous year
(C) before the expiry of six months from the end of the relevant previous
before the due date of return whichever is earlier

should deposit the

year or
(A)

213) Deduction on account of Site Restoration Fund shall be allowed to:


(A) any assessee
(B) company assessee engaged in the business of prospecting for or
production of petroleum or natural gas or both
(C) any assessee engaged in the business mentioned in clause (b) above

extraction or
(C)

214) The maximum deduction for Site Restoration Fund under section 33ABA
(A) the amount deposited in the scheme
(B) 20 % of the profits from such business
(C) 20 % of the amount deposited in the scheme

shall be:

215) Tick the case where the amount withdrawn from Site Restoration Account
(A) amount withdrawn for the purpose specified in the scheme
(B) closure of business
(C) death of an assessee
(D) partition of HUF
(E) dissolution of a firm
(F) liquidation of a company

shall not be taxable:

(B)

(A)
216) Expenditure on scientific research incurred by the assessee shall be allowed if
(A) is related to the business of the assessee
(B) may or may not relate to the business of the assessee
(C) is related to the research specified by the Government

such research:

217) If an assessee carries on any scientific research related to his business, he shall
deduction u/s 35 on account of:
(A) revenue expenditure
(B) capital expenditure
(C) both revenue and capital expenditure
(D) both revenue and capital expenditure excepting expenditure incurred
acquisition of land
218) Certain revenue and capital expenditure on scientific research are allowed as
previous year of commencement of business even if these are
incurred:
(A) 5 years immediately before the commencement of the business
(B) 3 years immediately before the commencement of the business
(C) any time prior to the commencement of the business

(A)
be allowed

on
(D)
deduction in the

(B)
219) Where a scientific research asset is sold without having been used for other
purpose then the sale
price to the extent of the cost of the asset already
allowed as deduction in the past shall be treated as:
(A) business income
(B) short-term capital gain
(C) long-term capital gain
(D) long-term or short-term capital gain depending upon the period for
which such
asset was held
(A)
220) Where the sale price in the above exceeds the cost of acquisition of such asset,
such excess shall be
treated as:
(A) business income
(B) short-term capital gain
(C) long-term capital gain
(D) long-term or short-term capital gain depending upon the period for
which such
asset was held
(D)
221) If the income of a business before claiming revenue expenditure on scientific
research is Rs.50,000
and the revenue expenditure incurred on scientific
research related to the business of the assessee is
Rs.80,000, then Rs.30,000
shall be:
(A) business loss
(B) unabsorbed capital expenditure on scientific research

(C)

none of these two

(A)
222) If the income of a business before claiming capital expenditure on scientific
research is Rs.50,000
and the capital expenditure incurred on scientific
research related to the business of the assessee is
Rs.80,000, then Rs.30,000
shall be:
(A) business loss
(B) unabsorbed capital expenditure on scientific research
(C) none of these two
(B)
223) Brought forward unabsorbed capital expenditure on scientific research can be
carried forward:
(A) for any number of years
(B) for 8 years
(C) for 10 years
(A)
324) If any amount is donated for research, such research should be in the nature
of:
(A) scientific research only
(B) social or statistical research only
(C) scientific or social or statistical research
(C)
325) If donation is made for scientific or social or statistical research, such
research:
(A) must relate to the business of the assessee
(B) may or may not relate to the business of the assessee
(C) none of these
(B)
326) Donation for scientific or social or statistical research shall be allowed as
deduction to the extent of:
(A) 50 % of the donation so made
(B) 100 % of the donation so made
(C) 125 % of the donation so made
(D) 150 % of the donation so made
(C)
327) If donation is made to a National Laboratory or a University or IIT with the
specific direction that
scientific research should be for an approved
programme, the amount of deduction shall be:
(A) 50 % of the donation so made
(B) 100 % of the donation so made
(C) 125 % of the donation so made
(D) 150 % of the donation so made
(C)
328) (i) Weighted deduction of 150 % for in-house research in some cases is
allowed to:
(A) any assessee
(B) company assessee
(C) a scientific research association
(B)
(ii) Weighted deduction of 150 % for in-house research in some cases shall be
allowed for the
purchase of:
(A) any assets
(B) any assets other than land
(C) any assets other than land and buildings
(C)
329) Expenditure incurred on acquisition of patents and copyrights after 31.03.1998
are subject to:
(A) deduction in 14 equal instalments
(B) deduction in 10 equal instalments
(C) depreciation u/s 32
(C)
330) Lumpsum payment for acquisition of technical know-how after 31.03.1998
shall be subject to:
(A) deduction in 6 equal instalments
(B) deduction in 3 equal instalments
(C) depreciation u/s 32
(C)
331) Expenditure incurred for obtaining licence to operate telecommunication
services shall be allowed
in:
(A) 10 equal instalments
(B) 14 equal instalments
(C) in equal instalments over the period for which the licence remains in
force
(C)

332) R Ltd., paid Rs.1,10,00,000 during the previous year 2005-06 for acquiring
the telecommunication
rights which were effective for 11 years. It
commenced the business of operating the telecommunication
service with
effect from previous year 2006-07. R Ltd., shall be entitled to a deduction of:
(A) Rs.10 lakhs w.e.f. previous year 2005-06
(B) Rs.11 lakhs w.e.f. previous year 2006-07
(C) none of these two
(B)
333) R had acquired a licence to operate telecommunication service in the
previous year 2004-05 for
Rs.2 crores and its life was 10 years. During the
previous year 2006-07 it had sold the licence for
Rs.1,50,00,000. It shall be
allowed a deduction under section 35ABB during the previous year 2006-07
to the extent of:
(A) Rs.20 lakh
(B) Rs.10 lakh
(C) None of the above two
(B)
334) For claiming deduction under section 35AC, the payment for eligible project
and scheme should be
made to:
(A) a public sector company
(B) a local authority
(C) to an institution or an association approved by the National Committee
(D) to any of the three mentioned in (A), (B) and (C)
(D)
335) A company assessee shall be allowed deduction under section 35AC on
account of eligible
project and scheme if:
(A) the payment is made to the specified institution
(B) if it incurs expenditure itself
(C) both for payment made to specified institution and for direct
expenditure
incurred by itself
(C)
336) Preliminary expenses incurred are allowed deduction in:
(A) 10 equal instalments
(B) 5 equal instalments
(C) full
(B)
337) In the case of non-company assessee, the total preliminary expenses incurred
are allowed deduction
to the extent of:
(A) 2 % of the cost of the project
(B) 5 % of the cost of the project
(C) 10 % of the cost of the project
(B)
338) In case of company assessee, the total preliminary expenses incurred are
allowed as deduction to
extent of 5 % of:
(A) the cost of the project
(B) the aggregate capital employed
(C) the cost of project or capital employed
(C)
339) Expenditure incurred on prospecting, etc., of minerals shall be allowed as
deduction in:
(A) 5 equal instalments
(B) 10 equal instalments
(C) full
(B)
340) In case the assessee follows merchantile system of accounting, bonus or
commission to the employee
are allowed as deduction on:
(A) due basis
(B) payment basis
(C) due basis but subject to section 43B
(C)
341) Interest accrued before the commencement of the production is to be:
(A) capitalised
(B) treated as revenue expenditure
(C) either capitalized or treated as revenue expenditure
(A)
342) Interest on money borrowed for acquiring an asset by an existing concern for
expansion of the
existing business, pertaining to a period prior to the date on
which the asset is put to use is to be:
(A) capitalised
(B) treated as revenue expenditure

(C) either capitalised or treated as revenue expenditure at the option of the


till the asset is put to use
343) Interest on money borrowed for the purpose of acquiring a capital asset
the asset is put to use is to be:
((A) capitalised
(B) treated as revenue expenditure
(C) either capitalized or treated as revenue expenditure

assessee

(A)
pertaining to the period after

(B)
purpose of carrying

344) Expenditure incurred on purchase of animals to be used by the assessee for the
on his business and profession is subject to:
(A) depreciation
(B) deduction in the previous year in which animal dies or becomes
useless
(C) nil deduction

permanently
(B)

345) Expenditure incurred on family planning amongst the employees is allowed


(A) any assessee
(B) a company assessee
(C) an assessee which is a company or co-operative society
346) Capital expenditure incurred on family planning amongst employees of the
allowed as deduction:
(A) in full
(B) in 5 equal instalments
(C) in 10 equal instalments

to:

(B)
company assessee is

(B)
347) (i) The business income of a company assessee before claiming Rs.60,000
being 1/5 th of capital
expenditure on family planning is Rs.40,000. The
balance Rs.20,000 shall be treated as:
(A) business loss
(B) unabsorbed expenditure on family planning
(C) none of these two
(B)
(ii) The business income of a company before claiming Rs.60,000 being
revenue expenditure on
family planning is Rs.40,000. The balance of
Rs.20,000 shall be treated as:
(A) business loss
(B) unabsorbed expenditure on family planning
(C) none of these two
(B)
(iii) The business income of a company assessee before claiming deduction of
revenue and capital
expenditure is Rs.6,00,000. The revenue and capital
expenditure incurred during the year are
Rs.7,00,000 and Rs.10,00,000
respectively. The unabsorbed expenditure on family planning in this
case
shall be:
(A) Rs.3,00,000
(B) Rs.11,00,000
(C) Rs.2,00,000 and Rs.1,00,000 shall be business loss
(A)
348) Deduction u/s 37(1) shall be allowed of those expenditure which are of:
(A) revenue nature
(B) capital nature
(C) both revenue and capital nature
(A)
349) Interest on capital of or loan from partner of a firm is allowed as deduction to
the firm to the extent
of:
(A) 18 % p.a.
(B) 12 % p.a. even if it is not mentioned in partnership deed
(C) 12 % p.a. or at the rate mentioned in partnership deed whichever is less
(C)
350) Deduction u/s 40(b) shall be allowed on account of salary/remuneration paid
to:
(A) any partner
(B) major partner only
(C) working partner only
(C)
351) Remuneration paid to working partner shall be allowed as deduction to a firm:
(A) in full
(B) subject to limits specified in section 40(b)

(C)

none of these two

352) A firms business income is nil/negative. It shall still be allowed as deduction


remuneration to working partner to the maximum extent of:
(A) actual remuneration paid as specified in partnership deed
(B) Rs.50,000
(C) NIL

(B)
on account of

(B)
353) (i) A person carrying on specified profession is:
(A) required to maintain books of account
(B) required to maintain prescribed books of account
(C) not required to maintain books of account
(B)
(ii) A person carrying on specified profession is required to maintain the
prescribed books of
account of the current previous year if the gross
receipts of such profession in all the three preceding
previous years
exceed:
(A) Rs.40,00,000
(B) Rs.10,00,000
(C) Rs.1,50,000
(D) Rs.60,000
(C)
(iii) A person carrying on specified profession is required to maintain:
(A) prescribed books of account in all cases
(B) prescribed books of account if the gross receipts of all the three preceding previous years
exceeds Rs.1,50,000 otherwise no books of account are to be maintained
(C) prescribed books of account if the gross receipts of all the preceding previous years exceeds
Rs.1,50,000 otherwise such books of account as will enable the Assessing Officer to compute
his business income
(C)
354) If a person sets up a specified profession during the current previous year, he
is:
(A) required to maintain prescribed books of account
(B) not required to maintain prescribed books of account
(C) required to maintain prescribed books of account if the gross receipts
of such
profession is likely to exceed Rs.1,50,000 otherwise such
books of account which will enable the
Assessing Officer to compute
his total income
(C)
355) A person who has been carrying on non-specified profession is:
(A) not required to maintain any books of account
(B) required to maintain books of account of the current previous year if
the gross
receipts of such profession exceeds Rs.1,50,000
(C) required to maintain books of account of the current previous year if
the gross
receipts of such profession of any of the preceding previous
year exceeded Rs.10 lakh
(D) required to maintain books of account of the current previous year if in
any of
the preceding 3 previous years his total income exceeded
Rs.1,20,000 or gross receipts exceeded
Rs.10 lakh
(D)
356) (i) A person, who has been carrying on business is required to maintain books
of account of the
current previous year if:
(A) his total income of any 3 preceding previous years exceeded
Rs.1,20,000
(B) his gross turnover or sales of any of 3 preceding previous year
exceeded Rs.10
lakh
(C) if condition mentioned either in (a) or (b) is satisfied
(C)
(ii) A person who sets up a non-specified profession or commences a business
during the current
previous year is required to maintain books of account if
his:
(A) total income of the current year exceeds or is likely to exceed Rs.1,20,000
(B) his gross turnover or sales of any of 3 preceding previous year exceeded Rs.10 lakh
(C) if condition mentioned either in (a) or (b) is satisfied
(C)
357) For persons carrying on business or non-specified profession, the books of
account to be maintained
have been:
(A) prescribed
(B) not prescribed
(C) none of these
(B)

358) For persons carrying on profession, tax audit is compulsory, if the gross
exceeds:
(A) Rs.50 lakh
(B) Rs.40 lakh
(C) Rs.10 lakh

receipts of the previous year

359) Tax audit is compulsory in a case a person is carrying on business whose


turnover/sales/receipts, as the case may be exceeds:
(A) Rs.10 lakh
(B) Rs.40 lakh
(C) Rs.1 crore

(C)
gross

(B)
360) In case an assessee is engaged in the business of civil construction,
presumptive income scheme is
applicable if the gross receipts paid or
payable to him in the previous year does not exceed:
(A) Rs.10 lakh
(B) Rs.40 lakh
(C) Rs.50 lakh
(B)
361) In the aforesaid case, the income shall be presumed to be:
(A) 5 % of gross receipts
(B) 8 % of gross receipts
(C) 10 % of gross receipts
(B)
362) If an assessee is engaged in the business of civil construction and he had opted
for presumptive
income scheme under section 44AD, the assessee shall:
(A) be entitled to deduction u/s 30 to 37
(B) not be entitled to any deduction u/s 30 to 37
(C) not be entitled to deduction u/s 30 to 37 except on account of interest
on capital
and loan from a partner and remuneration to working partner
as per section 40(b)
(C)
363) In case an assessee is engaged in the business of plying hiring or lease goods
carriage, presumptive
income scheme under section 44 AE is applicable if the
assessee is the owner of maximum of:
(A) 8 goods carriages
(B) 10 goods carriages
(C) 12 goods carriages
(B)
364) As per presumptive income scheme under section 44AE, the presumed
income shall be:
(A) Rs.3,000 p.m. per goods carriage
(B) Rs.3,500 p.m. per heavy goods vehicle and Rs.3,150 p.m. per vehicle
other
than heavy goods vehicle
(C) Rs.3,500 p.m. per heavy goods vehicle; Rs.3,150 p.m. for medium
goods
vehicle and Rs.2,000 p.m. per light commercial vehicle
(B)
365) In case an assessee is engaged in the business of retail trade, presumptive
income scheme is
applicable if the total turnover of such retail trade of goods
does not exceed:
(A) Rs.10 lakh
(B) Rs.30 lakh
(C) Rs.40 lakh
(D) Rs.50 lakh
(C)
366) In the above case, the income to be presumed under section 44AF shall be:
(A) 8 % of total turnover
(B) 5 % of total turnover
(C) 10 % of total turnover
(B)
367) If the assessee opts for presumptive income scheme under section 44AD or
44AF or 44AE, then the
assessee shall:
(A) not be entitled to any deduction u/ss 30 to 37
(B) be entitled to deduction under sections 30 to 37
(C) not be entitled to deduction u/ss 30 to 37 except for interest or capital
or loan
from partner and remuneration to a working partner subject to
conditions laid down under section
40(b)
(C)
368) In case of non-resident, who is carrying on shipping business, his Indian
income shall be presumed to
be:
(A) 5 % of certain amount received

(B)
(C)

7 % of certain amount received


10 % of certain amount received

(B)
369) The income of a non-resident from shipping business under section 44B shall
be presumed to be 7
% of:
(A) the amount paid or payable whether in India or out of India to the
assessee on
account of carriage of passengers, livestock, mail or goods
shipped at any port in India
(B) the amount received or deemed to be received in India on account of
carriage
of passengers, livestock, mail or goods shipped at any port
outside India
(C) both the amount mentioned in (A) & (B) above
(C)
370) In case of non-resident, who is engaged in the business of operation of
aircraft, his income shall be
presumed to be:
(A) 7 % of certain amount
(B) 5 % of certain amount
(C) 10 % of certain amount
(B)
371) The expenditure incurred on payment under voluntary retirement scheme shall
be allowed as
deduction in:
(A) the previous year it is paid
(B) equal instalments in 5 assessment years starting from the assessment
year in
which it is paid
(C)
Not allowed at all
(B)
372) Capital gain arises from the transfer of:
(A) any asset
(B) any capital asset
(C) land and buildings and shares only
(B)
373) Short-term capital gain is a gain arising from the transfer of an asset which is
held by the assessee for
not more than:
(A) 36 months from the date of its acquisition
(B) 12 months from the date of its acquisition
(C) 12 months from the date of its acquisition in case of shares, units and
any other
listed securities and for not more than 36 months in the case
of other assets
(C)
374) Period of holding bonus shares or any other financial asset allotted without
any payment shall be
reckoned from:
(A) the date of holding of original shares/financial asset
(B) the date of offer of bonus shares/financial asset
(C) the date of allotment of such bonus shares/financial assets
(C)
375) Period of holding of right shares or any other security shall be reckoned from:
(A) the date of the right share/any other securities are offered
(B) the date of right shares/such securities are applied by the assessee
(C) the date of allotment of right shares/such securities
(C)
376) If physical shares are sold through brokers, the date of transfer shall be:
(A) the date on which shares are transferred by the company
(B) the date of brokers note book
(C) the date of brokers note book provided such transaction is followed by
delivery of shares
377) Distribution of assets by a company at the time of liquidation shall be
regarded as a transfer and
subject to capital gain:
(A) in the hands of the company
(B) in the hands of the shareholders
(C) in the hands of both company as well as shareholders
(D) neither in the hands of a company nor in the hands of shareholders
(B)
378) Distribution of assets at the time of partial or complete partition of HUF shall:
(A) be regarded as a transfer in the hands of HUF for capital gain purposes
(B) be regarded as a transfer in the hands of coparceners
(C) not be regarded as transfer in the hands of HUF

(D) neither be regarded as transfer in the hands of HUF nor in the hands of
coparceners
(D)
379) Transfer of capital asset under a gift or will or to an irrevocable trust shall:
(A) be regarded as transfer in the hands of donor
(B) not be regarded as transfer in the hands of donor
(C) none of the above two
(B)
380) Transfer by holding company to its subsidiary company or by a subsidiary
company shall not be regarded as transfer if the
holding company owns:
(A) 90 % shares of the subsidiary company
(B) 100 % shares of the subsidiary company
(C) 51 % shares of the subsidiary company
381) Amalgamation of company as per the scheme of amalgamation shall not be
provided the amalgamated company is:
(A) a Domestic company
(B) a Public Ltd., company
(C) an Indian company

company to its holding

(B)
regarded as transfer

(C)
382) Transfer of capital asset in the scheme of demerger shall not be regarded as
transfer for the purpose of
capital gain if:
(A) the demerged company is an Indian company
(B) the resulting company is an Indian company
(C) both demerged and resulting company should be an Indian company
(B)
383) The period of holding of shares acquired in exchange of convertible
debentures shall be reckoned
from:
(A) the date of holding of debentures
(B) the date when the debentures were converted into shares
(C) none of these two
(B)
384) Securities transaction tax paid by the seller of shares and units shall:
(A) be allowed as deduction as expenses of transfer
(B) not be allowed as deduction
(B)
385) Securities transaction tax paid by the purchaser of shares/units shall:
(A) form part of the cost of such shares and units
(B) not form part of the cost of such shares and units
(B)
386) The assessee is allowed to opt for market value as on 1.4.1981 in case of:
(A) all capital assets
(B) all capital assets other than depreciable assets
(C) all capital assets other than depreciable asses, goodwill of a business,
right to
manufacture, tenancy rights, loom hours and route permits
(C)
387) Where the capital asset became the property of the assessee I any mode given
under section 49(1), the
cost of acquisition of such assets shall be:
(A) the market value of the asset as on the date of acquisition by the
assessee
(B) cost for which the previous owner of the property acquired it
(C) nil
(B)
388) Where a shareholder of an amalgamating company gets the shares of the
amalgamated company in
lieu of the shares held by him in an amalgamating
company, the cost of acquisition of such shares shall be:
(A) market value of the shares of an amalgamated company as on the date
of
amalgamation
(B) cost of the shares held in amalgamating company
(C) market value of the share of the amalgamated company as on the date
of
amalgamation
(B)
389) If the shares are acquired on conversion of debentures, the cost of acquisition
of such share shall be:
(A) market value of the shares on the date of conversion
(B) market value of the debentures on the date of conversion
(C) cost of acquisition of the debentures
(C)

390) The cost of acquisition of the employees stock option shall be:
(A) market value of shares on the date of offer
(B) market value of the shares on the date of exercise of option
(C) nil or price at which it was offered to employee
391) If the goodwill of a business, right to manufacture or produce, tenancy rights,
hours is acquired before 1.4.1981, the cost of acquisition
of such asset shall be:
(A) cost for which it was acquired by the assessee
(B) market value as on 1.4.1981
(C) nil
392) (i) If the bonus shares are acquired before 1.4.1981, the cost of acquisition of
shall be:
(A) nil
(B) market value of such bonus share on the date of allotment
(C) market value as on 1.4.1981
(ii) If the bonus shares are acquired on or after 1.4.1981, the cost of acquisition
shall be:
(A) market value of such shares on the date of allotment
(B) nil
(C) none of these
393) The cost of acquisition of the right shares to a person who purchased the right
from the existing shareholder shall be:
(A) market value of right share on date of allotment
(B) price at which these shares are offered
(C) price at which these shares are offered plus the amount paid to the
renouncing the right
394) (i) If any advance money received by the assessee in any earlier occasion of
not materialize, is forfeited, such money shall:
(A) be taxable in the year it is forfeited
(B) be deducted from the cost of acquisition of such asset
(C) not be taxable

(C)
route permit or loom

(A)
such bonus shares

(C)
of such shares

(B)
to acquire the share

person
(C)
transfer, which could

(B)
(ii) If advance money forfeited is more than the cost of acquisition of the assets,
the excess
amount shall:
(A) be taxable as capital gain in the year of forfeiture of money
(B) be taxable as capital gain in the previous year in which the assessee against which advance
money was received is transferred
(C) be treated as capital receipt and hence not taxable
(C)
395) Cost of improvement of goodwill of a business or right to manufacture or
produce any article or thing
shall be:
(A) nil
(B) the capital expenditure incurred
(C) the capital expenditure incurred on or after 1.4.1981
(A)
396) Cost of improvement of tenancy rights, route permits or loom hours shall be:
(A) nil
(B) any capital expenditure incurred on the improvement of such asset
(C) any capital expenditure incurred on the improvement of such asset on
or after
1.4.1981
(C)
397) In case of long-term capital gain, the amount to be deducted from
consideration price shall be:
(A) cost of acquisition
(B) indexed cost of acquisition
(C) market value as on 1.4.1981
(B)
398) No indexation of cost of acquisition is done even though there is long-term
capital gain in case of:
(A) bonds or debentures
(B) certain assets held by non-residents
(C) certain assets held by non-residents and any bonds or debentures other
than
capital indexed bonds issued by Government
(C)

399) The cost inflation index number of the previous year 2006-07 is:
(A) 519
(B) 447
(C) 480
(D) 497
(A)
400) Conversion of capital asset into stock-in-trade will result into capital gain of
(A) in which such conversion took place
(B) in which such converted asset is sole or otherwise transferred
(C) none of these two

the previous year:

(B)
401) Conversion of personal effect into stock in trade shall:
(A) be subject to capital gain
(B) not be subject to capital gain
(C) shall be subject to tax under business head
(B)
402) Where capital asset is converted into stock-in-trade then for the purpose of
gain, the full value of consideration shall be:
(A) the market value of the asset on the date of sale of such asset
(B) the market value of the asset on the date of conversion of such asset
(C) the price for which it is sold
403) Where the capital asset is converted into stock-in-trade, the indexation of cost
of improvement shall be done:
(A) till the previous year of conversion of such capital asset
(B) till the previous year in which such asset is sold
(C) none of these two
404) Where a partner transfers any capital asset into the business of firm, the sale
asset to the partner shall be:
(A) market value of such asset on the date of such transfer
(B) price at which it was recorded in the books of the firm
(C) cost of such asset to the partners

computation of capital

(B)
of acquisition and cost

(A)
consideration of such

(B)
distribution on the dissolution

405) Where any capital asset is transferred by a firm to its partner by way of
of firm, the full value of consideration in this
case shall be:
(A) the price at which such asset was given to partners
(B) cost or W.D.V. of such asset on the date of distribution
(C) fair market value of the asset on the date of such transfer

(C)
406) Where the entire block of the depreciable asset is transferred after 36 months,
(A) short-term capital gain
(B) long-term capital gain
(C) short-term capital gain or loss
(D) long-term capital gain or loss
407) Where a capital asset, other than certain urban agricultural land, is
capital gain shall arise in the previous year:
(A) of compulsory acquisition
(B) in which full consideration is received
(C) in which part or full consideration is received
408) In the case
done till the:
(A)
(B)
(C)

there will be:

(C)
compulsorily acquired, then the

of compulsory acquisition, the indexation of cost of acquisition or

(C)
improvement shall be

previous year of compulsory acquisition


in which the full compensation is received
in which part or full compensation is received

(A)
409) In case of compulsory acquisition, if an assessee receives enhanced
compensation then the enhanced
compensation is taxable as:
(A) short-term capital gain
(B) long-term capital gain
(C) short-term or long-term capital gain depending upon the original
capital gain of
compulsory acquisition
(C)

410) In case of compulsory acquisition, if enhanced compensation is received, then


for purpose of
computation of capital gain the cost of acquisition and cost of
improvement in that case shall be taken as:
(A) nil
(B) cost of acquisition or cost of improvement which was in excess of
initial
compensation earlier received
(C) none of these
(A)
411) In case of compulsory acquisition if initial compensation or enhanced
compensation is received by
legal heir due to death of assessee, then capital
gain shall:
(A) not be taxable in the hands of legal heir
(B) be taxable in the hands of legal heir
(C) for initial compensation the legal heir will be taxable as representative
assessee
and for enhanced compensation he shall be himself taxable
(C)
412) Conversion of debentures into shares shall:
(A) be regarded as transfer for capital gain purpose
(B) not be regarded as transfer for capital gain purpose
(C) none of these
(B)
413) If goodwill of a profession which is self-generated is transferred, there will:
(A) be capital gain
(B) not be any capital gain
(C) be a short-term capital gain
(B)
414) Where a company purchases its own shares there will be capital gain to the:
(A) company
(B) shareholder
(C) neither to the company nor to the shareholder
(D) both to the company and to the shareholder
(B)
415) For claiming exemption under section 54, the assessee should transfer:
(A) any house property
(B) a residential house property
(C) a residential house property, the income of which is taxable under the
head
income from house property
(C)
416) In the above case, the residential house property should be transferred:
(A) before 36 months
(B) after 36 months
(C) after 12 months
(B)
417) Exemption under section 54 is available to:
(A) all assessees
(B) individuals only
(C) individuals as well as HUF
(C)
418) For claiming exemption u/s 54, the assessee should purchase residential
(A) 2 years after the date of transfer
(B) 3 years after the date of transfer
(C) one year before or two years after the date of transfer
(D) one year before or three years after the date of transfer
419) For claiming exemption under section 54, the assessee should construct the
within:
(A) one year before or two years after the date of transfer
(B) one year before or three years after the date of transfer
(C) within three years after the date of transfer
(D) within two years after the date of transfer

property:

(C)
residential property

(C)
420) The exemption under section 54 shall be available:
(A) to the extent of capital gain invested in the house property
(B) proportionate to the net consideration price invested
(C) to the extent of amount actually invested
(A)

421) If the assessee wishes to deposit money under capital gain scheme for
claiming exemption under
section 54, it should be deposited within:
(A) six months from the date of transfer
(B) within six months from the end of the relevant previous year
(C) due date of furnishing the return of income u/s 139(1)
(D) six months or within due date of furnishing the return of income
whichever is
earlier
(C)
422) Amount utilised in the capital gain scheme for which exemption was claimed
u/s 54 shall be treated
as long term capital gain of previous year:
(A) in which period of 2 years has expired from the date of deposit
(B) in which period of 2 years has expired from the date of transfer
(C) in which period of 3 years has expired from the date of deposit
(D) in which period of 3 years has expired from the date of transfer
(D)
423) The new house purchased or constructed for which exemption was claimed
under section 54, should
not be transferred within 3 years:
(A) from the date of transfer of original house
(B) from the date of its purchase/construction
(C) from the end of the previous year
(B)
424) Where a new house property for which exemption was claimed u/s 54 is
transferred within 3 years
from the date of its acquisition then:
(A) capital gain exempt under section 54 earlier shall be taxable
(B) the entire capital gain on new transfer shall be taxable
(C) for purpose of computation of capital gain, the cost of acquisition of
the said
house shall be reduced by the amount of capital gain exempt
u/s 54 earlier
(C)
425) For claiming exemption u/s 54B, the asset transferred should be:
(A) urban agricultural land
(B) any agricultural land
(C) rural agricultural land
(A)
426) The exemption u/s 54B is allowed to:
(A) any assessee
(B) individual only
(C) individual or HUF
(B)
427) For claiming exemption u/s 54B, the agricultural land must have been used for
agricultural purpose by
the individual or his parents for at least:
(A) any period of 2 years prior to the date of transfer
(B) a period of 2 years immediately preceding the date of transfer
(C) a period of 3 years immediately preceding the date of transfer
(B)
428) For claiming exemption under section 54B the assessee should acquire:
(A) urban agricultural land
(B) rural agricultural land
(C) any agricultural land
(C)
429) For claiming exemption u/s 54B, the new agricultural land should be
purchased:
(A) within 3 years from the date of transfer
(B) within 2 years from the date of transfer
(C) within 2 years from the end of the relevant previous year
(B)
430) Amount utilised in the capital gain scheme for which exemption u/s 54B was
claimed shall be treated
as:
(A) long-term capital gain
(B) short-term capital gain
(C) short-term or long-term capital gain depending upon the original
transfer
(C)
431) If the new agricultural land purchased (for which exemption was claimed
under section 54(B) is
transferred within 3 years, then:
(A) capital gain exempt u/s 54B earlier shall be taxable
(B) the entire capital gain or new transfer shall be taxable
(C) for the purpose of computation of capital gain, the cost of acquisition
shall be
reduced by the amount of capital gain exempt u/s 54B earlier
(C)

432) Exemption u/s 54D is available to:


(A) any assessee
(B) any assessee owning an industrial undertaking
(C) an individual or HUF owning and industrial undertaking
(B)
433) Exemption u/s 54D is available if there is:
(A) a transfer
(B) compulsory acquisition by law
(C) sale
(B)
434) Exemption u/s 54D is available if there is a compulsory acquisition of:
(A) any land and building used by an industrial undertaking
(B) land and building which has been used by the industrial undertaking
2 years for its activities, immediately preceding the date of
compulsory acquisition
(C) land and building used for at least 3 years immediately preceding the
compulsory acquisition
435) For claiming exemption u/s 54D, the assessee should purchase and/or
building within:
(A) 2 years from the date of compulsory acquisition
(B) 3 years from the date of compulsory acquisition
(C) within 3 years from the end of the previous year of compulsory

for at least
date of

(B)
construct another land and

acquisition

(B)
436) If the new land and building acquired for claiming exemption u/s 54D, is
transferred within 3 years,
then there will be:
(A) short-term capital game
(B) exemption claimed u/s 54D earlier shall be withdrawn
(C) the cost of acquisition of the said asset shall be reduced by the capital
gain
exempt u/s 54D earlier
(C)
437) New assets acquired for claiming exemption u/s 54, 54B or 54D, if transferred
within 3 years, will
result in:
(A) short-term capital gain
(B) long-term capital gain
(C) short-term or long-term capital gain depending upon original transfer
(A)
438) Unutilised amount deposited under capital gain scheme for claiming
exemption u/s 54D shall be
treated as:
(A) short-term capital gain
(B) long-term capital gain
(C) short-term or long-term capital gain depending upon the original
transfer
(C)
439) Exemption under section 54EC shall be available to:
(A) any assessee
(B) individual only
(C) individual or HUF
(D) company assessee only
(A)
440) Exemption u/s 54EC shall be available for transfer of:
(A) any long-term capital asset
(B) residential house property
(C) any long-term capital asset other than residential house property
(A)
441) Under section 54 EC, the assessee shall be allowed exemption:
(A) to the extent of capital gain invested
(B) proportionate to the net consideration price so invested
(C) to the extent of amount invested
(A)
442) For claiming exemption u/s 54EC, amount to the extent of the capital gain
should be invested:
(A) within 2 years from the date of transfer
(B) within 3 years from the date of transfer
(C) within 6 months from the date of transfer
(D) within 6 months of transfer or before the due date of furnishing the
return of
income, whichever is earlier
(C)

443) For claiming exemption u/s 54EC, the amount to the extent of capital gain
six months from the date of transfer in:
(A) State Bank of India
(B) Notified securities
(C) State Bank of India or Notified securities
(D) Bonds of the NHAI or RECL

should be invested within

(D)
444) For claiming exemption u/s 54EC, the amount shall be invested in notified
(A) a period of 3 years from the date of transfer
(B) a period of 3 years from the date of acquisition of such securities
(C) a period of 7 years from the date of transfer
(D) a period of 7 years from the date of its acquisition

securities for:

(B)
445) If notified securities for which exemption has been claimed u/s 54EC are
transferred or converted
into money or any loan is taken against the same
within 3 years then the:
(A) exemption allowed under section 54EC shall be withdrawn by opening
the old
assessment
(B) amount exempt under section 54EC earlier shall be long-term capital
gain of
the previous year in which such transaction takes place
(C) the cost of acquisition of such securities shall be reduced by the
amount of
capital gain exempt u/s 54EC earlier
(B)
446) Capital gain scheme is:
(A) applicable for section 54EC
(B) not applicable for section 54EC
(B)
447) Exemption u/s 54F is available to:
(A) any assessee
(B) an individual
(C) an individual or HUF
(C)
448) Exemption u/s 54F is available in respect of transfer of:
(A) any capital asset
(B) residential house property
(C) any capital asset other than residential house property
(C)
449) Exemption u/s 54 F is available if the asset transferred is:
(A) long-term capital asset other than residential house property
(B) short-term capital asset other than residential house property
(C) short-term/long-term capital asset other than residential house property
(A)
450) Exemption u/s 54F is available:
(A) to the extent of amount invested
(B) proportionate to the net consideration price so invested
(C) to the extent of amount actually invested
(B)
451) Exemption u/s 54F is available if the new asset acquired is:
(A) any residential house property
(B) any house property
(C) residential house property for self-occupation
452) For claiming exemption u/s 54F, the amount to the extent of net
in the purchase of residential house
property within:
(A) 2 years from the date of transfer
(B) 3 years from the date of transfer
(C) one year or two years after the date of transfer
(D) one year before or 3 years after the date of transfer

(A)
consideration price is to be invested

453) For claiming exemption u/s 54F, the amount to the extent of consideration
the construction of the residential house property
within:
(A) 3 years after the date of transfer
(B) 2 years after the date of transfer
(C) one year before or 2 years after the date of transfer

(C)
price is to be invested in

(A)

454) Exemption u/s 54F shall not be allowed if the assessee, on the date of transfer
(A) any residential house
(B) a residential house which is let out
(C) a house which is self-occupied
(D) more than one residential house

owns:

(B)
455) Exemption u/s 54G is available on account of transfer:
(A) for any reason
(B) in pursuance of shifting from urban area to any other area
(C) in pursuance of shifting from urban area to rural area
(B)
456) Exemption u/s 54G is available to:
(A) any assessee
(B) any assessee who owns an industrial undertaking
(C) individual or HUF who owns an industrial undertaking
(B)
must have been used by

457) For claiming exemption u/s 54G, such land, building or Plant and Machinery
the industrial undertaking:
(A) for at least 2 years immediately preceding the date of transfer
(B) any period of 2 years
(C) none of these two

(C)
458) For claiming exemption u/s 54G, the assessee shall acquire the new asset
(A) 2 years from the date of transfer
(B) 3 years from the date of transfer
(C) one year before or 2 years after the date of transfer
(D) one year before or 3 years from the date of transfer

within:

(D)
assessee has died, the

459) Where after depositing the amount under capital gain scheme, the individual
amount lying in the capital gain scheme:
(A) shall be taxable in the hands of legal heir
(B) should be utilised by the legal heir for the specified purpose
(C) shall be exempt in the hands of legal heir
460) Total income for assessment year 2007-08 of an individual including longRs.60,000 is Rs.1,40,000. The tax on total income shall
be:
(A) Rs.8,800
(B) Rs.8,160
(C) Rs.7,000
461) Total income of an individual including long-term capital gain of Rs.50,000 is
total income shall be:
(A) Rs.1,020
(B) Rs.2,040
(C) Rs.2,244

(C)
term capital gain of

(B)
Rs.1,10,000, the tax on

(B)
462) Long-term capital gain on sale of equity shares and units of an equity oriented
(A) taxable @ 10 % without indexation
(B) exempt
(C) exempt if sold on or after 1.10.2004
(D) exempt if sold on or after 1.10.2004 through a recognised stock
India and such transaction is chargeable to securities
transaction tax

fund shall be:

exchange in
(D)

463) Long-term capital gain from the sale of units of equity oriented fund shall be:
(A) exempt if sold through a recognised stock exchange and securities
tax is paid
(B) exempt if sold through a recognised stock exchange or to mutual fund
securities transaction tax is paid
464) Short-term capital gain arising for the transfer of equity shares and units of
be taxable:
(A) at the normal rate
(B) at the rate of 20 %
(C) at the rate of 10 % if transferred on or after 1.10.2004

transaction
and

(B)
equity oriented fund shall

(D) at the rate of 10 % if transferred on or after 1.10.2004 through a


stock exchange and such transaction is chargeable to
securities transaction tax

recognised
(D)

465) Deduction u/s 80C shall be allowed:


(A) from the gross total income of the individual or HUF
(B) from the income from long-term capital gain
(C) from the gross total income other than long-term capital gain from any
and short-term capital gain on shares sold through recognised
stock exchange
(D) from the gross total income other than long-term capital gain

asset
(D)

466) Deduction u/s 80C to 80U is allowed from:


(A) income from long-term capital gain as well as short-term capital gain
(B) short-term capital gain other than short-term capital
transferred through a recognized stock exchange
(C) long-term capital gain
(D) neither from income from long-term or short-term capital gain
(E) short-term capital gain
467) In case of compulsory acquisition, the period for investment specified assets
54D and 54F shall be reckoned from:
(A) the date of transfer
(B) the date when the part of full compensation is received
(C) the date as and when any compensation is received

gain

from

shares

(B)
under section 54, 54B,

(C)
468) Deduction u/s 80C to 80U is allowed from:
(A) gross total income
(B) gross total income exclusive of long-term capital gain
(C) gross total income exclusive of long-term capital gain as well as shortterm
capital gain
(D) gross total income exclusive of long-term capital gain from any asset
and shortterm capital gain from the transfer of shares and units
through a recognised stock exchange
(D)
469) Income under the head income from other source is taxable on:
(A) due basis
(B) receipt basis
(C) on the basis of method of accounting regularly employed by the
assessee
(C)
470) Dividend declared by a domestic company:
(A) is fully exempt
(B) fully taxable
(C) taxable but deduction is allowed u/s 80L on account of such dividend
(A)
471) Dividends declared by Unit Trust of India is:
(A) fully exempt in the hands of Unit holders
(B) fully taxable
(C) taxable but deduction is allowed u/s 80L
(A)
472) Deemed dividend is:
(A) taxable in all cases
(B) exempt in all cases except where a loan/advance is given to a
shareholder/concern by an Indian Company
(C) exempt in all cases except where a loan/advance is given by a closely
held
domestic company to a shareholder who has 10 % voting power in
the domestic company or to a
concern in which such shareholder has
twenty per cent voting power or share as the case may be
(C)
473) Where a closely held company gives a loan/advance to a shareholder who has
10 % voting power in
the company or to concern in which such shareholder
has 20 % share in case such concern is a noncompany assessee or has
substantial interest (20 % voting power) in case it is a company then
loan/advance so paid shall be deemed dividend to the extent of:
(A) accumulated profits whether capitalized or not
(B) accumulated profits excluding capitalized profits
(C) the loan or advance so paid
(B)
474) Loan & advance paid by the closely held company to its shareholder having
10 % voting power is the
ordinary cause of money lending business shall:

(A) be treated as deemed dividend


(B) not be treated as deemed dividend
(C) none of these two
(B)
game, etc., are casual

475) Winning from lotteries, crossword puzzles, horse races & other races, card
income & hence:
(A) fully exempt
(B) exempt up to Rs.5,000
(C) fully taxable

(C)
assessee shall:
earning such

476) For computing lottery, crossword puzzles, races, card games income, etc., the
(A) be entitled to deduction for purchase/any expenditure incurred for
income
(B) not be entitled to any deduction for purchase/any expenditure
(C) be entitled to deduction up to certain limits

(B)
477) The lottery, crossword puzzle, races, card games incomes, etc., are taxable at:
(A) normal slab rate of income-tax like any other income
(B) flat rate of 20 % + surcharge + education cess @ 2 %
(C) flat rate of 30 % + surcharge + education cess @ 2 %
(D) flat rate of 30 % + surcharge of 2.5 % + education cess @ 2 %
(C)
478) If no system of accounting is followed, interest on securities is taxable on:
(A) due basis
(B) receipt basis
(C) due or receipt basis at the option of the assessee
(A)
standard deduction from

479) The legal heir of the deceased who receives family pension is allowed a
such family pension received to the extent of:
(A) 1/3rd of such pension subject to maximum of Rs.20,000
(B) 1/3rd of such pension or Rs.15,000 whichever is less
(C) 1/3rd of such pension or Rs.12,000 whichever is less

(B)
transfer of the asset from

480) If there is a transfer of income by a person to another person without the


which the income arises, such income shall be
included in the income of:
(A) transferor
(B) transferee
(C) transferor if transfer is revocable
(D) transferee if transfer is irrevocable
481) If there is a revocable transfer of an asset by any person to another person, any
such asset shall be included in the income of:
(A) transferor
(B) transferee
(C) both transferor & transferee

482) If there is a transfer of asset which is not revocable during the life time of the
arising from such asset shall be included in the income of:
(A) transferor
(B) transferee
(C) transferee till his death and thereafter in the hands of the transferor

(A)
income arising from

(A)
transferee, income

(C)
included in his total income

483) Where an individual has substantial interest in a concern, there shall be


any remuneration paid by such concern to:
(A) the wife of such individual
(B) the husband of such individual
(C) the spouse of such individual

(C)
484) Substantial interest for the purpose of clubbing provisions u/s 64(i) & (ii) shall
(A) the individual only
(B) the individual & his spouse taken together
(C) the individual along with his relatives
485) As per section 64(i) & (iv), there shall be included in the income of an
from the gift of the spouse of:
(A) any capital asset

be of:

(C)
individual, any income arising

(B) any asset


(C) any asset other than house property
(C)
486) R has sold 2000 14 % debentures of Rs.100 each to his wife for Rs.90,000.
The market value of
debentures on the date of transfer was Rs.1,80,000. In
this case, interest income to be included in the
total income of R shall be:
(A) Rs.28,000
(B) Rs.14,000
(C) Rs.25,200
(D) Rs.12,600
(B)
487) Where an individual transfers the house property to his wife without adequate
consideration, then
income from such house property shall be subject to the
provisions of:
(A) section 64(1)(iv)
(B) section 27
(C) none of these
(B)
488) Clubbing provisions under section 64(1)(vi) are applicable where the asset is
transferred by an
individual without an adequate consideration to:
(A) daughters husband
(B) sons wife
(C) major son
(D) major daughter
(B)
489) R gifts Rs.5,00,000 to his wife who invested the same in the partnership
business. Mrs. R receives
Rs.1,45,000 as her share of profits from such firm.
In this case amount to be clubbed in the income of R
shall be:
(A) Rs.1,45,000
(B) Rs.10,000 after giving maximum exemption of Rs.1,35,000 to Mrs. R
(C) Rs.NIL
(C)
490) R gifted Rs.10,00,000 to his wife on 1.4.2003. The wife invested the above
sum as capital
contribution to the firm where she is a partner and earned
interest every year. The total capital of Mrs. R
as on 1.4.2006 including 3
years interest was Rs.15,00,000. During the year she earned Rs.2,70,000 as
interest on such capital balance. The income to be clubbed in the hands of R
shall be:
(A) Rs.2,70,000
(B) Rs.1,80,000
(C) Rs.NIL
(B)
491) As per section 64(1A) income accruing to a minor shall be clubbed in the
income of:
(A) father
(B) mother
(C) father or mother at his option
(D) a parent whose income before their clubbing is greater
(D)
492) If the marriage of the parent does not subsist, the income of the minor child
shall be clubbed in the
income of:
(A) father
(B) parent who maintains the child
(C) father or mother whose income is higher
(B)
493) When income of a minor child is clubbed in the income of the parent
concerned, such parent will be
allowed exemption of:
(A) Rs.1,500
(B) Rs.1,500 per minor child
(C) to the extent of actual income clubbed or Rs.1,500 per minor child
whichever is
less
(C)
494) If any income has to be clubbed under section 64, it will be clubbed under the:
(A) head, income from other sources
(B) relevant head to which it belongs
(C) none of these two
495) Loss from a speculation business of particular assessment year can be set off
year from:

(B)
in the same assessment

(A) profits and gains from any business


(B) profits and gains from any business other than speculation business
(C) income of speculation business
496) Loss on account of owning & maintaining race horses of particular assessment
the same assessment year from:
(A) any business income
(B) any income under the head other sources
(C) income from race horses
497) Short-term capital loss of particular assessment year can be set off in the same
(A) short-term or long-term capital gain
(B) long-term capital gain only
(C) long-term or short-term capital gain
498) Long-term
from:
(A)
(B)
(C)

capital loss of a particular assessment year can be set off in the

(C)
year can be set off in

(C)
assessment year from:

(C)
same assessment year

short-term or long-term capital gain


long-term capital gain only
short-term capital gain only
(B)

499) Loss under the head capital gain in a particular assessment year can:
(A) be set off from any other head of income in the same assessment year
(B) be carried forward
(C) neither be set off nor carried forward
(B)
500) During the previous year an assessee has incurred loss from his business
amounting to Rs.1,10,000
whereas his income from house property is
Rs.1,00,000. The assessee in this case can carry forward:
(A) business loss of Rs.10,000 only
(B) business loss of Rs.1,10,000 and claim full exemption
(C) at his option do any; of these
(A)
501) Loss under the head business and profession can be set off in the same
assessment year from:
(A) income under any other head
(B) income under any other head except salary income
(C) income under any other head except house property
(B)
502) The loss is allowed to be carried forward only when an assessee has furnished:
(A) return of loss
(B) return of loss before the due date mentioned u/s 139(1)
(C) or not furnished the return of loss
(B)
503) Loss under the head income from house property can be carried forward:
(A) only if the return is furnished before the due date mentioned u/s 139(1)
(B) even if the return is not furnished
(C) even if the return is furnished after the due date
(C)
504) A business loss can be carried forward and set off in the subsequent
assessment year when the
business on account of which this loss has arisen:
(A) is continued in the assessment year in which such loss is set off
(B) is continued or not
(C) is continued for any part of the previous year
(B)
505) Loss on account of owning and maintaining the race horse can be carried
forward:
(A) for 8 years
(B) for 4 years
(C) indefinitely
(B)
506) Loss from derivate trading in shares carried on in a recognised stock exchange
is:
(A) a loss from speculative business
(B) a loss from non-speculative business
(B)
507) Loss from derivate trading in shares carried on in a recognized stock exchange
can be set off:
(A) from the income from speculative business only
(B) from the income from non-speculative business only
(C) from the income of both speculative and non-speculative business

(C)
508) Loss from derivate trading in shares can be carried forward for:
(A) 8 years
(B) 10 years
(C) 4 years
(A)
509) Loss from derivate trading in commodity exchange is a:
(A) loss from speculative business
(B) loss from non-speculative business
(A)
510) Loss under the head house property:
(A) can be carried forward for 8 years
(B) cannot be carried forward
(C) can be carried forward for only 4 years
(A)
511) Brought forward loss:
(A) can be set off in any of the eight succeeding years
(B) must be set off in the immediate succeeding
immediately next succeeding year and so on
(C) as per (B) above but within the time allowed

year

and

balance

in

the
(C)

512) In the case of amalgamation, carry forward of business loss and unabsorbed
depreciation in the hands
of amalgamated company shall be allowed:
(A) of any amalgamating company
(B) of an amalgamating company which is owning an industrial
undertaking or a
ship
(C) of an amalgamating company which is owning an industrial
undertaking or a
ship or a hotel or a bank with a specified bank
(D) of an amalgamating company which is an Indian company and is
owning
industrial undertaking or ship
(C)
513) In case of amalgamation if the conditions mentioned u/s 72A are satisfied, the
amalgamated company
shall be allowed to carried forward the loss and
unabsorbed depreciation of amalgamated company for:
(A) fresh eight years
(B) eight years minus the assessment years already expired in the hands of
amalgamating company
(C) indefinitely
(A)
514) Loss of a closely held company cannot be carried forward and set off unless
on the last day of the
previous year in which such loss is set off, at least:
(A) 51 % of the shares are beneficially held by the same persons
(B) 50 % of the shares are beneficially held by the same persons
(C) 40 % of the shares are beneficially held by the same persons
(A)
515) Speculation loss can be carried forward for the maximum of:
(A) 8 years
(B) 10 years
(C) 4 years
(C)
516) Deduction u/s 80C in respect of LIP, contribution to PF, etc., is allowed to:
(A) any assessee
(B) individual assessee only
(C) individual or HUF who is resident in India
(C)
517) Deduction u/s 80C is allowed to a maximum of:
(A) Rs.70,000
(B) Rs.1,00,000
(C) Rs.1,40,000
(B)
518) Deduction u/s 80C is allowed from:
(A) gross total income
(B) gross total income exclusive of long-term capital gain
(C) gross total income exclusive of short-term capital gain from transfer of
listed
securities through stock exchange and long-term capital gain on
any asset
(C)

519) For claiming deduction u/s 80C in respect of LIP., premium can be paid by
(A) himself only
(B) himself or the spouse
(C) himself, spouse and minor children
(D) himself, spouse and dependant children
(E) himself, spouse and any child
520) For claiming deduction u/s 80C, for life insurance premium if the payment is
for his child, then the child:
(A) should be dependant on assessee
(B) may or may not be dependant
(C) may be married or unmarried and dependant or not dependant

assessee for:

(E)
made by the assessee

(C)
521) In case of HUF, deduction u/s 80C in respect of LIP shall be allowed for:
(A) any coparcener of the HUF
(B) Karta of HUF
(C) any member of HUF
(C)
522) An assessee has paid life insurance premium of Rs.25,000 during the
previous year for a policy of
Rs.1,00,000. He shall:
(A) not be allowed any deduction u/s 80C
(B) be allowed deduction u/s 80C to the extent of 20 % of the capital sum
assured
i.e., Rs.20,000
(C) be allowed deduction for the entire premium as per the provisions of
section
80C
(B)
523) For claiming deduction u/s 80C in respect of PPF, the contribution must be
paid by the individual in
the PPF account of:
(A) himself only
(B) himself and spouse
(C) himself, spouse or any child
(C)
524) For claiming deduction u/s 80C by an individual in respect of PPF
contribution for any child, the
child should be:
(A) minor child
(B) any child dependant on such individual
(C) any child dependant or not dependant or not dependant on such
individual
(C)
525) For claiming deduction u/s 80C in respect of ULIP by an individual, the
contribution can be paid by
the individual for:
(A) himself only
(B) himself and spouse
(C) himself, spouse or any child
(C)
526) For claiming deduction u/s 80C in respect of National Savings Certificates of
VIII issue, the NSC
should be acquired by the individual in:
(A) his name only
(B) his name of any spouse name
(C) in his name or spouse name or the name of any child
(D) in his name or spouse or in the name of minor child
(A)
527) For amount subscribed to National Saving Scheme 1992, the individual shall
be allowed deduction
u/s 80C for amount deposited:
(A) in his name only
(B) in his name or in the name of the spouse
(C) in his name, in the name of spouse or in the name of any child
(A)
528) For claiming deduction u/s 80C, the individual shall make the payment for
Jeevan Dhara or Jeevan
Akshay Scheme in:
(A) his own name
(B) his own name or in the name of his spouse
(C) in his own name, in the name of spouse or in the name of any child
(A)
529) If an assessee discontinues the life policy before the premium of 2 years have
been paid then:
(A) no deduction shall be allowed in respect of the payment made in the
year of
termination

(B) besides what is mentioned in (A) above the aggregate amount of the
deduction
from income so allowed in respect of the previous year or
years preceding such previous year,
shall be deemed to be the income
of the assessee of such previous year and shall be liable to tax
in the
assessment year relevant to such previous year
(B)
530) If a member, participating in the ULIP Plan, terminates his participation or
ceases to participate by
reason non-payment of his contribution, before
making deduction for 5 years, then:
(A) no deduction shall be allowed in respect of the amount paid in the
previous
year of termination
(B) besides what is mentioned in (A) the aggregate deduction allowed in
the past
years shall be deemed to be the income in the previous year in
which membership is terminated
(C) besides what is mentioned in (A), the cases of the past years in which
deduction was allowed shall be re-opened and tax shall be recomputed
and the
balance tax payable shall be so payable for these relevant years
(B)
531) The annual interest accrued on NSCs VIII issue shall be:
(A) exempt
(B) taxable
(C) besides what is mentioned in (B), the interest so accrued shall also be
eligible
for deduction u/s 80C
(C)
532) For claiming deduction u/s 80C, the payment or deposit should be made:
(A) out of any income
(B) out of any income chargeable to income tax
(C) during the current year out of any source
(C)
533) Deduction u/s 80C shall be allowed for:
(A) any education fee
(B) tuition fee exclusive of any payment towards any development fee or
donation
or payment of similar nature
(C) tuition fee and annual charges
(B)
534) Deduction u/s 80C for tuition fee shall be allowed if such fee is paid to:
(A) any university, college, school or other educational institution situated
India or outside
(B) any university, college, school or other educational institution situated
India

within
within
(B)

535) Deduction u/s 80C for tuition fee shall be allowed for the purpose of:
(A) any full time education
(B) any full or part time education
(C) full time education in a college
(D) full time education in a school
(A)
536) Deduction u/s 80C in respect of tuition fee is allowed to:
(A) an individual only
(B) an individual or HUF
(C) any assessee
(A)
537) Deduction u/s 80C in respect of term deposit shall be allowed if the term
(A) not less than 3 years
(B) not less than 5 years
(C) not less than 7 years

deposit is for a period:

(B)
538) Deduction u/s 80C in respect of tuition fee is allowed to an individual for:
(A) any of his children
(B) any two children of such individual
(C) any two minor children of such individual
(D) any two dependent children of such individual
(B)
539) Deduction u/s 80C in respect of tuition fee is allowed to the maximum extent
(A) Rs.12,000 per child for maximum of 2 children
(B) Rs.12,000 p.m. per child for maximum of 2 children
(C) Rs.1,00,000 per child
(D) Rs.1,00,000 for two children

of:

540) Deduction in respect of contribution for annuity plan to certain pension fund
allowed to:
(A) any assessee
(B) individual assessee only
(C) individual or HUF
(D) individual who is resident in India

(D)
under section 80CCC is

(B)
541) Deduction u/s 80CCC is allowed to the extent of:
(A) Rs.20,000
(B) Rs.1,00,000
(C) Rs.10,000
(B)
542) Amount received from the surrender of annuity plan or amount received as
plan by the assessee or his nominee shall be:
(A) exempt
(B) taxable
(C) exempt up to certain limit, balance taxable
543) Deduction u/s 80CCD in respect of contribution to pension scheme of Central
to:
(A) Central Government employees only
(B) Central and State Government employees
(C) any employee

pension from the annuity

(B)
Government is allowed

(A)
544) Deduction u/s 80CCD is allowed to the extent of:
(A) employees contribution up to 10 % of salary
(B) employees contribution up to 15 % of salary
(C) employees and Central Government contribution each up to 10 %
(D) employees and Central Government contribution each up to 15 % of

salary
salary
(C)

545) Deduction u/s 80C, 80CCC and 80CCD cannot exceed:


(A) Rs.1,00,000
(B) Rs.1,10,000
(C) Rs.1,50,000
(A)
546) Deduction u/s 80D in respect of medical insurance premia is allowed to:
(A) any assessee
(B) an individual or HUF
(C) individual or HUF who is resident in India
(D) individual only
(B)
547) Deduction u/s 80D is allowed if the premium is paid to:
(A) Life Insurance Corporation
(B) General Insurance Corporation or any other insurer
(C) Life Insurance or General Insurance Corporation
(B)
548) The payment for insurance premium under section 80D should be paid:
(A) in cash
(B) by cheque
(C) in cash or by cheque at the option of the assessee
(B)
549) The quantum of deduction allowed under section 80D shall be limited to:
(A) Rs.6,000
(B) Rs.10,000
(C) Rs.40,000
(B)

550) Where the assessee or his wife or her husband or dependant parents or any
member of the family of
HUF is a senior citizen and the medical insurance
premium is paid to effect or keep in force an insurance
in relation to him or
her the deduction allowed shall be:

(A) Rs.10,000
(B) Rs.15,000
(C) Rs.20,000
(B)
dependant being a

551) Deduction u/s 80DD in respect of maintenance including medical treatment of


person with disability shall be allowed to:
(A) any assessee
(B) an individual or HUF
(C) an individual or HUF who is resident in India

(C)
552) (i) Deduction u/s 80DD shall be allowed:
(A) to the extent of actual expenditure/deposit or Rs.40,000 whichever is
(B) for a sum of Rs.50,000 irrespective of actual expenditure or deposit
(C) for a sum of Rs.40,000 irrespective of any expenditure incurred or
amount deposited

less
actual
(B)

(ii) Deduction u/s 80DD in case of dependant with severe disability shall be
allowed:
(A) to the extent of actual expenditure/deposit or Rs.50,000 whichever is less
(B) for a sum of Rs.75,000 irrespective of actual expenditure or deposit
(C) for a sum of Rs.50,000 irrespective of any expenditure incurred or actual amount deposited
(B)
disease is allowed to:

553) Deduction u/s 80DDB in respect of medical treatment for specified ailment or
(A) any assessee
(B) individual or HUF
(C) individual or HUF who is resident in India

(C)
554) Deduction u/s 80DDB shall be allowed for medical treatment of specified
(A) any dependant relative
(B) any dependant handicapped relative
(C) the assessee himself or any dependant relative

ailment or disease of:

(C)
555) Deduction u/s 80DDB shall be allowed for a sum of:
(A) Rs.40,000 irrespective of any expenditure
(B) Rs.40,000 or actual expenditure whichever is less
(C) Rs.50,000
(B)
556) In case the assessee or dependant relative is a senior citizen then the deduction
allowed for a sum of:
(A) Rs.40,000 or actual expenditure whichever is less
(B) Rs.60,000 or actual expenditure whichever is less
(C) Rs.60,000 irrespective or actual expenditure

u/s 80DDB shall be

(B)
557) Deduction u/s 80E is allowed on account of:
(A) repayment of loan taken from certain specified institutions
(B) repayment of loan and interest on loan taken from certain specified
(C) interest on loan taken from certain specified institutions

institutions
(C)

558) Deduction u/s 80E in respect of interest on loan taken for higher education
(A) an individual assessee only
(B) an individual who is resident in India
(C) an individual or HUF
(D) an individual or HUF who is resident in India
559) Deduction u/s 80E shall be allowed in respect of amount paid by way of
(A) any person
(B) financial institutions
(C) financial institutions or approved charitable institutions

shall be allowed to:

(A)
interest on loan taken from:

(C)
560) For claiming deduction of interest u/s 80E loan should be taken for doing:
(A) any post graduate course
(B) any graduate or post graduate course in engineering, medicine,
(C) for course mentioned in (B) and post graduate course in applied
sciences including mathematics and pure sciences

management
science or pure
(C)

561) The deduction u/s 80E is allowed for payment by way of interest on loan to
(A) Rs.25,000

the extent of:

(B)
(C)

Rs.40,000
any amount
(C)

562) Deduction u/s 80E for payment by way of interest on loan is allowed for:
(A) 5 years
(B) 8 years or till the interest is paid whichever is earlier
(C) 10 years
(D) 8 years
(B)
563) Deduction u/s 80G on account of donation is allowed to:
(A) a business assessee only
(B) any assessee
(C) individual or HUF only
(B)
564) Deduction in respect of rent paid u/s 80GG shall be allowed to:
(A) an individual
(B) any individual or HUF
(C) any assessee
(A)
565) Deduction in respect of rent paid u/s 80GG is allowed to:
(A) any individual
(B) any individual who is self-employed
(C) any individual who is self-employed or who is an employee but not
entitled to
HRA or rent free accommodation
(D) same as (C) above and who pays rent for his residential
accommodation
(D)
566) The maximum deduction u/s 80GG shall be limited to:
(A) Rs.1,000 p.m.
(B) Rs.2,000 p.m.
(C) Rs.3,000p.m.
(B)
567) Deduction u/s 80GGA in respect of certain donations for scientific research or
rural development is
allowed to:
(A) any assessee
(B) non-corporate business assessee
(C) an assessee whose gross total income does not include income
chargeable
under the head business and profession
(C)
568) Deduction u/s 80GGA shall be allowed to the extent of:
(A) 100 % of the donations so made
(B) 1 times of the donation so made
(C) 1 times of the donation so made
(A)
569) Deduction u/s 80-IA in respect of profits and gains from infrastructure facility
is allowed to an
enterprises which is owned by:
(A) an Indian Company
(B) an Indian Company or other person who is resident in India
(C) an Indian Company or a consortium of such companies
(D) an Indian Company or a consortium of such companies or by an
authority or a
board or a corporation or any other body established or
constituted under any Central or State Act
(D)
570) Deduction u/s 80-IA in respect of an undertaking which is engaged in
providing telecommunication
services, etc., is allowed if it is owned by:
(A) an Indian Company
(B) any assessee
(C) an Indian company or consortium of such companies
(B)
571) Deduction to telecommunication industrial undertaking is allowed if it starts
providing
telecommunication services between:
(A) 1.4.1995 & 31.3.2005
(B) 1.4.1995 & 31.3.2004
(C) 1.4.1997 & 31.3.2004
(A)

572) Deduction to undertaking which develops, maintains, etc., any industrial part
undertaking is owned by:
(A) an Indian Company
(B) an Indian Company or a Consortium of such companies
(C) any assessee
573) Deduction
time between:
(A)
(B)
(C)

for operating an Industrial Park will be allowed only if such park

allowed if such

(C)
begins to operate any

1.4.1995 & 31.3.2003


1.4.1997 & 31.3.2006
1.4.1997 & 31.3.2009

(C)
574) Deduction u/s 80-IA for any undertaking or enterprises engaged in
development of infrastructure
facility shall be allowed to the extent of:
(A) 100 % of the profits for first 5 years and 30 % for subsequent 5 years
(B) 50 % of the profits for 10 years
(C) 100 % of the profits of such industrial undertaking or enterprises for
10 years
(C)
575) Deduction u/s 80-IA for any undertaking or enterprises engaged in
development of infrastructure
facility shall be allowed @ 100 % for
consecutive assessment years out of:
(A) 15 years beginning with the year in which undertaking or the enterprise
develops or begins to operate any infrastructure facility
(B) 20 years beginning with the year in which undertaking or the enterprise
develops or begins to operate any infrastructure facility
(C) 20 years beginning with the year in which undertaking or the enterprise
develops or begins to operate any infrastructure facility other than port,
airport,
inland port or inland waterways and out of 15 years for such
port, airport, inland port or inland
waterways
(C)
576) Deduction u/s 80-IA for enterprise engaged in the business of providing
telecommunication, etc.,
shall be allowed for:
(A) 10 years @ 100 %
(B) first 5 assessment years @ 100 % and 30 % for the subsequent 5
assessment
years
(C) first 5 assessment years @ 100 % and 30 % in case of a company and
25 % in
case of non-company assessee for the subsequent 5 assessment
years
(B)
577) Deduction u/s 80-IA for enterprise engaged in the business of
telecommunication shall be allowed
for:
(A) first 5 assessment years @ 100 % and for the next 5 assessment years
@ 30 %
starting from the assessment year in which it starts providing
telecommunication services
(B) first 5 consecutive assessment years @ 100 % and subsequent 5
assessment
years @ 30 % out of 15 years being with the year in which
enterprises starts providing
telecommunication services
(C) first 5 consecutive assessment years @ 100 % and subsequent 5
assessment
years @ 30 % out of 20 years being with the year in which
enterprises starts providing
telecommunication services
(B)
578) Deduction u/s 80-IB in respect of an industrial undertaking established in a
backward state or district
of category-A shall be allowed for:
(A) 100 % of profits from such industrial undertaking for 10 years
(B) 150 % of profit for 10 years
(C) 100 % of profits for 5 years, 30 % or 25 % of profits in case of
company and
non-company assessee other than co-operative society
for subsequent 5 years (25 % of the profits
in case of co-operative
society for subsequent 7 years
(C)
579) Deduction u/s 80-IB in respect of an industrial undertaking established in a
district of category-B
shall be allowed:
(A) 100 % of the profits from such industries for 10 years
(B) 100 % of the profits for the first 3 years and 30 % (in case of company)
or 25
% (in case of non-company assessee) of the profit, as the case
may be for the next five years
(C) 100 % of the profits for the first 5 years and 30 % (in case of company)
or 25
% (in case of non-company assessees) for next 5 years but 25 %
of the profits in case of a cooperative society for next 9 years
(C)

580) Deduction u/s 80-IB in respect of a hotel located in a hilly area or rural area or
shall be allowed to the extent of:
(A) 30 % of the profits for 10 years
(B) 50 % of the profits for 10 years
(C) 100 % of profits for first 5 years and 30 % of profits for next
years
581) Deduction u/s 80-IB in respect of specified hotel or other hotel shall be allowed
of business taken place any time between:
(A) 1.4.1995 & 31.3.1999
(B) 1.4.1997 & 31.3.2001
(C) 1.4.1997 & 31.3.2002

a place of pilgrimage

subsequent 5
(B)
if the commencement

(B)
582) Deduction of any hotel other than specified hotel established in any area other
than Delhi, Mumbai,
Chennai and Calcutta shall be allowed to the extent of:
(A) 50 % of the profits for 10 years
(B) 30 % of the profits for 10 years
(C) 30 % of the profits for 12 years
(B)
583) Deduction u/s 80-IB in respect of specified or other hotel shall be allowed to:
(A) an Indian Company
(B) any assessee
(C) an Indian Company or a person other than a company who is resident
in India
(D) an Indian Company with a paid up capital of at least Rs.5,00,000
(D)
584) Deduction u/s 80-IB for enterprises carrying on scientific and industrial
research and development is
allowed in case of:
(A) any assessee
(B) an Indian Company
(C) an Indian Company or a person other than company resident in India
(B)

585) The quantum of deduction in case of an enterprises on scientific and industrial


development shall be allowed to the extent of:
(A) 100 % for a period of 7 assessment years
(B) 100 % for a period of 5 assessment years
(C) 100 % for a period of 10 assessment years
586) Deduction u/s 80-IB in case of an undertaking engaged in commercial
mineral oil in any part of India is allowed to the
extent of:
(A) 100 % of profits for 5 assessment years
(B) 100 % of profits for 7 assessment years
(C) 100 % of profits for 10 assessment years
587) Deduction u/s 80-IB in case of an undertaking engaged in developing and
shall be allowed to:
(A) any assessee
(B) an Indian Company
(C) any assessee other than an Indian Company

research and

(C)
production or refining of

(B)
building housing project

(A)
588) Deduction u/s 80-IB in case of an undertaking engaged in developing and
building housing project
shall be allowed provided the project is on the size of
plot of:
(A) at least 1 acre except when allowed by notification by the Centre or
State
Government
(B) at least 1 hectate
(C) at least 1 acre
(A)
589) Deduction u/s 80-IB in case of an undertaking engaged in developing and
building housing project
shall be allowed provided the resident unit has a
built area of:
(A) 1500 Sq. feet in Delhi, Mumbai, Chennai and Calcutta and 1000 Sq.
feet in any
other place
(B) 1000 Sq. feet in Delhi, Mumbai, Chennai and Calcutta and 1500 Sq.
feet in any
other place
(C) 1500 Sq. feet at any place in India
(B)

590) Deduction u/s 80-IB in case of an undertaking engaged in the housing project
plan lay-out are approved by the local authority
before:
(A) 31.3.2005
(B) 31.3.2006
(C) 31.3.2007

shall be allowed only if

(C)
591) Deduction u/s 80-IB in case of an undertaking engaged in the business of
housing project shall be
allowed only if the housing project is:
(A) completed within 4 years from the end of the financial year in which
plan layout is approved by the local authority
(B) completed before 1.4.2008 if the plan lay-out is approved before
1.4.2004 and
within 4 years from the end of the financial year in which
plan lay-out is approved by the local
authority
(C) completed before 1.4.2008
(B)

592) Deduction u/s 80JJA in respect of profits and gains from business of
collecting and processing of
bio-degradable waste is allowed to the extent of:
(A) 100 % of the profits derived from such business or Rs.5,00,000
whichever is
less
(B) 100 % of the profits for a period of 10 years
(C) 100 % of the profits for a period of 5 consecutive assessment years
(C)
593) Deduction u/s 80JJA in respect of employment of new worker shall be
allowed to:
(A) any assessee
(B) an Indian Company
(C) an Indian Company or a person other than company resident in India
(B)
594) Deduction u/s 80JJA shall be allowed to a new industrial undertaking owned
by a company assessee
in respect of employment of regular workmen
exceeding:
(A) 80 workmen
(B) 100 workmen
(C) 150 workmen
(B)
595) Deduction u/s 80JJAA to existing Industrial undertaking shall be allowed if
there is:
(A) any increase in regular workmen
(B) at least 10 % increase in the number of workmen employed
(C) there is 10 % increase as well as the total workmen including the new
workmen
exceeds 100 workmen
(C)
596) Deduction u/s 80JJAA to existing industrial undertaking shall be allowed for
the:
(A) additional wages paid to new workmen employed during the year
(B) additional wages paid to new workmen which are in excess of 100
workmen
(inclusive of existing workmen)
(C) additional wages paid to new workmen employed during the year in
excess of
100 workmen
(B)
597) Deduction u/s 80JJAA shall be allowed to the extent of:
(A) 100 % of the additional wages paid to the new regular workmen
(B) 50 % of the additional wages paid to the new regular workmen
(C) 30 % of the additional wages paid to the new regular workmen
(C)
598) Deduction u/s 80L is allowed to the extent of:
(A) Rs.12,000
(B) Rs.15,000
(C) NIL
(C)

599) Deduction u/s 80-IC is allowed if the business of the assessee is situated:
(A) in any State
(B) in any Backward State
(C) in the States of Sikkim, Himachal Pradesh and Uttaranchal

(C)

in the States of Sikkim, Himachal Pradesh, Uttaranchal or the North

Eastern

States
(D)
600) Where the business of manufacturing or producing is done or in any notified
specified areas in the
State of Sikkim, Himachal Pradesh, Uttaranchal or the
North Eastern States then for claiming deduction
u/s 80-IC, such business of
manufacturing or producing should be:
(A) of any article or thing
(B) of any article or thing not being an article or thing mentioned in
Schedule XIII
of the Income-tax Act
(C) of any article or thing mentioned in Schedule XIV of the Income-tax
Act
(B)
601) In the above case, if manufacturing or producing, etc., is done in any area
other than a notified area in
the aforesaid States, such business of
manufacturing or producing an article or thing or for an operation
should be
for:
(A) any article or thing
(B) any article or thing other than mentioned in Schedule XIII
(C) any article or thing or an operation mentioned in Schedule XIV of the
Incometax Act
(C)
602) Deduction u/s 80-IC is allowed to the extent of:
(A) 100 % of profits and gains for ten assessment years
(B) 100 % of profits and gains for ten assessment years in case of any
undertaking
or enterprise in the States of Sikkim or NorthEastern
Region and 50 % in case of undertaking in
Uttaranchal and Himachal
Pradesh
(C) 100 % of profits and gains for ten assessment years in case of an
undertaking or
enterprise in the States of Sikkim or North Eastern
States and 100 % of profits and gains for the
first 5 assessment years
and 25 % (30 % in the case of companies) for the next 5 assessment
years
(C)
603) Deduction u/s 80QQB is allowed in respect of royalty income to:
(A) an individual who is an author of a book
(B) an individual who is a resident in India and who is an author of a book
(C) an individual who is a resident in India and who is either an author of a
book or
a joint author of the book
(C)
604) Deduction u/s 80QQB is allowed to an author of a book provided such book is
of:
(A) literary nature
(B) scientific nature
(C) artistic nature
(D) literary or scientific nature
(E) scientific or artistic nature
(F) literary, artistic or scientific nature
(F)
605) Deduction u/s 80QQB is allowed to an author of a book of literary or artistic
or scientific nature who
is resident in India to the extent of:
(A) 100 % of royalty income or Rs.5,00,000 whichever is less
(B) 100 % of royalty income or Rs.3,00,000 whichever is less
(C) 100 % of royalty income or Rs.2,00,000 whichever is less
(C)
606) Deduction u/s 80U in case of permanent physical disability (including
blindness) is allowed to:
(A) an individual who is a citizen of India
(B) an individual who is a resident in India
(C) any individual assessee
(B)
607) Deduction u/s 80RRB in respect of royalty on patents shall be allowed to:
(A) an individual
(B) an individual who is resident in India
(C) an individual who is resident in India and is a patentee or co-patentee
(C)
608) The quantum of deduction allowed u/s 80U is:
(A) Rs.40,000
(B) Rs.50,000
(C) Rs.60,000
(B)
609) Deduction u/s 80U shall be allowed only when the assessee is suffering from a
permanent disability:
(A) at the beginning of the previous year
(B) at any time during the previous year

(C)

at the end of the previous year

(B)
610) Where the return of income is filed after the due date specified u/s 139(1):
(A) all deductions under Chapter VIA, i.e., 80C to 80U will be allowable
(B) all deductions under Chapter VIA, i.e., 80C to 80U will not be
allowable
(C) all deductions under Chapter VIA, i.e., 80C to 80U excepting 80-IA,
80-IAB,
80-IB and 80-IC will be allowable
(D) all deductions under Chapter VIA, i.e., 80C to 80U except 80-IA will
be
allowable
(C)
611) Agricultural income is exempt provided the:
(A) land is situated in India
(B) land is situated whether in India or outside India
(C) land is situated in any rural area in India
(A)
612) If the assessee is engaged in the business of growing and manufacturing tea in
India, the agricultural
income in that case shall be:
(A) 40 % of the income from such business
(B) 60 % of the income from such business
(C) market value of the agricultural produce minus the expenses on
cultivation of
such agricultural produce
(B)
613) If the assessee is engaged in the business of growing and manufacturing of
rubber, the agricultural
income in that case shall be:
(A) 40 % of the income from such business
(B) 60 % of the income from such business
(C) 65 % of the income from such business
(C)
614) If the assessee is engaged in the business of growing and curing of coffee, the
agricultural income in
that case shall be:
(A) 60 % of the income from such business
(B) 75 % of the income from such business
(C) 65 % of the income from such business
(B)
615) If the assessee is engaged in the business of manufacturing some products
other than tea, rubber or
coffee for which he uses his own agricultural
produce, then agricultural income in that case shall be:
(A) 60 % of the income from such business
(B) 75 % of the income from such business
(C) 65 % of the income from such business
(D) 40 % of the income from such business
(A)
616) If the assessee is engaged in the business of manufacturing some products
other than tea, rubber or
coffee for which he uses his own agricultural
produce, then agricultural income in that case shall be:
(A) 40 % of the income from such business of growing and manufacturing
the
products out of it
(B) 60 % of such income
(C) market value of such agricultural produce minus the expenses incurred
for
cultivation of such agricultural produce
(C)
617) If the assessee uses its own agricultural produce for the purpose of
manufacturing certain products
other than tea, rubber or coffee the cost of
such agricultural produce for the purpose of computing business
income of
manufacturing shall be:
(A) cost of producing such agricultural produce
(B) market value of such agricultural produce as on the date of use
(C) none of these two
(C)
618) If an assessee uses the agricultural produce grown by him for his own
consumption then:
(A) the market value of such agricultural produce shall be treated as his
agricultural
income
(B) the market value of the agricultural produce minus the cost of
cultivation shall
be treated as his agricultural income
(C) nothing shall be treated as his agricultural income
(C)
619) An assessee has incurred Rs.1,00,000 on the cultivation of agricultural
produce. 50 % of the produce
has been sold for Rs.1,10,000 and the balance
50 % has been used by the assessee for his self-consumption,
the agricultural
income in this case shall be:

(A) Rs.10,000
(B) Rs.60,000
(C) Rs.1,20,000
(B)
620) The partial integration of agricultural income with non-agricultural income is done in case of:
(A) all assessees
(B) any assessee other than who is liable to be taxed at the flat rate of income-tax
(C) individual, HUF, AOP or BOI and artificial juridical person
(C)
621) Agricultural income is:
(A) fully exempt
(B) partially taxable
(C) fully taxable
(A)
622) The partial integration of agricultural income is done to compute tax on:
(A) agricultural income
(B) non-agricultural income
(C) both agricultural and non-agricultural income
(B)
623) If a firm earns agricultural income, it will be exempt:
(A) in the hands of the firm
(B) in the hands of the firm but taxable in the hands of the partners
(C) in the hands of the firm as well as its partners
(D) in the hands of the firm as well as its partners but would be included in
other income of the partners for computation of tax on his other
incomes

the

(D)
624) If a company declares dividend out of agricultural income, such dividend declared by the company shall
be:
(A) exempt in the hands of the shareholder but dividend tax will be payable
by the
company
(B) not be subject to any income-tax, either in the hands of the company or
the
shareholder
(C) included in the total income of the shareholder
(A)
625) There will be no partial integration of agricultural integration with non- agricultural income, if the nonagricultural income of A who is less than 65 years does not exceed:
(A) Rs.5,000
(B) Rs.1,00,000
(C) Rs.50,000
(B)
626) There will be no partial integration, if the agricultural income does not exceed:
(A) Rs.50,000
(B) Rs.1,00,000
(C) Rs.5,000
(C)
627) Income derived from rubber plantation in Singapore but Received in India
shall be treated as:
(A) agricultural income and hence exempt
(B) agricultural income but taxable under the head income from other
source
(C) exempt as it is earned outside India
(B)
628) Dividend received by a shareholder from an Indian company the whole of
whose income is
agricultural income shall be treated as:
(A) agricultural income in the hands of shareholder and thus exempt
(B) agricultural income and thus exempt but it will be subject to partial
integration
(C) exempt under section 10(34) but taxable in the hands of the company
(D) income taxable under the head income from other sources
(C)
629) Rebate u/s 88E in respect of securities transaction tax is allowed to:
(A) any assessee
(B) an individual or HUF
(C) an assessee whose total income includes any income chargeable under
the head
profits and gains from business or profession which arises
from taxable securities transactions
(D) an assessee whose total includes any income which arises from taxable
securities transactions
(C)
630) Rebate u/s 88E in respect of securities transaction tax is allowed to the extent
of:
(A) securities transaction tax so paid

(B) an amount equal to the securities transaction tax paid in respect of


taxable
securities transactions or the amount calculated by applying the
average rate of income-tax on
income arising from taxable securities
transactions
(C) an amount equal to any securities transaction tax paid or the amount
calculated
by applying the average rate of income-tax on income
arising from taxable securities transaction
(B)
631) Share of profits which a partner receives from a firm which is assessed as firm shall be:
(A) fully exempt
(B) taxable under the head business and profession
(C) included in the total income of partner for rate purposes
(A)
632) Interest on Capital or loan received by a partner shall be:
(A) fully exempt
(B) fully taxable
(C) taxable to the extent the deduction is allowed to the firm
(D) taxable to the extent of 12 % p.a.
(C)
633) A firm assessed as firm shall be entitled to deduction on account of interest on
capital or loan paid to
the partner:
(A) to the extent of 18 % p.a.
(B) to the extent what is mentioned in the partnership deed
(C) to the extent of 15 % p.a. or what is mentioned in partnership deed
(D) to the extent of 12 % or lower rate as is mentioned in the partnership
deed
(D)
634) The deduction of interest and remuneration subject to restriction u/s 40(b)
shall be allowed to the firm
if the partnership is:
(A) evidenced by an instrument
(B) oral
(C) oral or evidenced by an instrument
(A)
635) A firm is evidenced by an instrument and the individual share of the partners
are specified in that
instrument, the firm in this case shall be assessed as firm
if the certified copy of the partnership is
submitted to the jurisdictional Assessing Officer:
(A) before the end of the previous year
(B) along with return of income before the due date of furnishing the return of income u/s 139(1)
(C) along with the return of income
(C)
636) A firm which is assessed as firm shall be entitled to deduction on account of remuneration paid to:
(A) any working partner only
(B) any partner whether working or non-working
(C) only one working partner
(A)
637) In case of a firm carrying on a specified profession, the deduction on account of remuneration to working
partners shall be to the maximum extent of:
(A) Rs.50,000
(B) On the first Rs.75,000 of book profits 90 % of book profits or
Rs.50,000
whichever is more, on the next Rs.75,000 of book profits 60 % and on the balance book profits 40 %
(C) On the first Rs.1,00,000 of book profits 90 % of book profits or Rs.50,000 whichever is
more, on the next Rs.1,00,000 of book profits 60 % and on the balance book profits 40 %
(C)
638) A firm carrying on business shall be entitled to deduction on account of any
remuneration to
working partner to the maximum extent of:
(A) Rs.50,000
(B) Rs.50,000 or 90 % of the first Rs.75,000 of book profits, whichever is more, 60 % of the next
Rs.75,000 book profits & 40 % of the balance book profits
(C) Rs.50,000 or 90 % of the first Rs.1,00,000 of book profit, 60 % of the
next
Rs.1,00,000 of book profit and 40 % of balance book profits
(B)
639) Remuneration paid to a working partner by a firm carrying on non-specified
profession shall:
(A) not be eligible for deduction
(B) be eligible for deduction in the same manner as is allowed as deduction
to the
firm
(C) be eligible for deduction in the same manner as is allowed to a firm
carrying on
specified profession
(B)

640) Where the book profits of the firm assessed as firm is negative, the remuneration paid to working partner
shall:
(A) not be allowed as deduction to the firm
(B) allowed as deduction to the firm
(C) allowed as deduction to the firm subject to a maximum of Rs.50,000
(C)
641) If for a particular year relevant to an assessment year, the firm has incurred
loss, such loss:
(A) is shared by partners & set off with their respective other income
(B) shall be carried forward by the firm only
(C) shall be either carried forward by the firm or its partners
(B)
642) If there is a change in the constitution of the firm due to retirement, death, etc.,
of the partner then the
brought forward loss of the firm shall:
(A) be allowed to be set off in the hands of reconstituted firm
(B) be allowed to be set off in the hands of reconstituted firm to the extent
of
brought forward loss minus share of the brought forward loss of
partner who has retired or died
(C) not be allowed to be carried forward and set off
(B)
643) A firm assessed as firm shall be liable to income-tax:
(A) at the rates applicable to an individual
(B) @ 35 % + 10 % surcharge + education cess @ 2 %
(C) 10 % on short-term capital gain on shares sold through recognised stock exchange, @ 20 %
on long-term capital gain or any asset other than shares sold through recognised stock exchange and 30 % on
other income + 10 % surcharge + education cess @ 2 %
(C)
644) Remuneration received by a non-working partner shall:
(A) be taxable in the hands of the partner
(B) not be taxable in the hands of such non-working partner
(C) not be taxable as the firm will not be allowed deduction on account of
such
amount and it will be treated as share of profits
(C)
645) If a firm is not evidenced by an instrument or if the partners shares are not
determinate or if the
partnership deed is not submitted along with the return of
income then such firm shall be:
(A) assessed as firm but firm shall not be entitled to deduction on account
of any
interest or remuneration to partners
(B) assessed as individual
(C) assessed in the hands of its partners by including the share of profits in
their
income
(D) assessed as AOP
(A)
646) Where in respect of any assessment year there is on the part of the firm any
such failure as is
mentioned in section 144, the firm shall be:
(A) assessed as AOP
(B) so assessed that no deduction by way of any payment of interest,
salary, bonus,
commission or remuneration made by such firm to any
partner shall be allowed in computing the
income of the firm
chargeable under the head business or profession
(C) assessed in the hands of partners individually
(B)
647) A firm is required to file return of income as per section 139(1):
(A) if its total income exceeds Rs.1,00,000
(B) if its total income exceeds the maximum amount which is not
chargeable to tax
which in case of a firm is NIL
(C) in all cases, whether it has any income/loss or not
(C)
648) AOP or BOI for the purpose of levy of tax does not include:
(A) a company
(B) a company or co-operative society
(C) a company or co-operative society or a society registered under the
Societies
Registration Act, 1860 or under any other law computing to
that Act in force in any part of India
(C)
649) A society registered under the Societies Registration Act, 1860 is taxable as:
(A) AOP/BOI as per section 167B
(B) AOP but the tax rate shall be same as is applicable in case of an
individual
(C) at special rate of tax
(B)
650) A co-operative society is although a body of individuals but is taxable at:
(A) the same rate as are applicable to individual

(B)
(C)

the special rates given in Schedule-I of the Income-tax Act


the maximum marginal rate of 30 %
(B)

651) In case of AOP/BOI, any interest paid to the member shall:


(A) be allowed as deduction to the AOP/BOI while computing its income
(B) be allowed as deduction to the AOP/BOI while computing its income
maximum of 12 % p.a.
(C) not be allowed as deduction

subject to

(C)
652) In case of AOP/BOI, any salary, bonus, commission or remuneration paid by
AOP/BOI to its member
shall:
(A) be allowed as deduction to the AOP/BOI while computing its income
(B) be allowed as deduction to the AOP/BOI while computing its income
subject to
the limit prescribed u/s 40(b)
(C) not be allowed as deduction
(C)
653) In case of AOP whose members are other than foreign company and their
shares are unknown, the
tax shall be charged:
(A) at the rate applicable to individuals
(B) at the maximum marginal rate i.e., 30 % + surcharge as applicable +
education
cess @ 2 %
(C) at the rate of 40 % + 2.5 % surcharge + education cess @ 2 %
(B)
654) In case of AOP whose members include a foreign company, and their shares
are unknown, the tax
shall be charged:
(A) at the rate applicable to individuals
(B) at the maximum marginal rate i.e., 30 % + surcharge as applicable +
education
cess @ 2 %
(C) at the rate applicable to the foreign company i.e., 40 % + surcharge @
2.5 % +
education cess at 2 %
(C)
655) In case of AOP whose members are other than foreign company, and whose
shares are known, but the
total income of any of its members exceeds the
maximum exemption limit, tax to the AOP shall be
charged:
(A) at the rate applicable to individuals
(B) at the maximum marginal rate i.e., 30 % + surcharge as applicable +
education
cess @ 2 %
(C) at the rate of 40 % + surcharge + education cess @ 2 %
(B)
656) In case of AOP whose members include a foreign company, and their shares are known, the tax shall be
charged:
(A) at the rate applicable to individuals
(B) at the maximum marginal rate i.e., 30 % + surcharge as applicable + education cess @ 2 %
(C) at the rate applicable to the foreign company i.e., 40 % + surcharge @ 2.5 % + education cess
at 2 %
(D) on that portion or portions of income of AOP which is relatable to the share of the member
which is a foreign company, the tax shall be charged @ 40 % + surcharge + education cess @ 2 % and on
the balance income at the maximum marginal rate
(D)
657) In case of AOP/BOI where the share of the members are known but none of
the members has
taxable income exceeding maximum exemption limit nor
any member is taxable at a rate higher than the
maximum marginal rate, the tax shall be charged:
(A) at the rate applicable to individuals
(B) at the maximum marginal rate i.e., 30 % + surcharge as applicable + education cess @ 2 %
(C) at the rate of 35 % + surcharge + education cess @ 2 %
(A)
658) In case of AOP where the share of the members are known but none of the members has taxable income
exceeding maximum exemption limit, but one or more member is taxable at a rate higher than the maximum
marginal rate, the tax shall be charged:
(A) at the rate applicable to individuals
(B) on that portion of income of AOP which is relatable to the member taxable at higher rate, at
the rate applicable to such member and the balance taxable income at the rate applicable to individuals
(C) on that portion of income of AOP which is relatable to the member taxable at higher rate, at
the rate applicable to such member and the balance taxable income at the maximum marginal rate
(C)

659) Where the total income of the AOP/BOI, whose none of the members has income exceeding maximum
exemption limit nor any member is taxable at a rate higher than maximum marginal rate, is less than
Rs.1,00,000:
(A) the AOP/BOI shall not be liable to pay any tax and the share of the profit of the member
from AOP/BOI shall not be included in their respective total income
(B) the AOP/BOI shall not be liable to pay any tax and the share of the profit of the member
from AOP/BOI shall be included in their respective total income
(C) the AOP/BOI will be liable to tax at the maximum marginal rate
(B)
660) Where the AOP/BOI has paid tax on its income @ 30 % or at a higher rate,
the share of the profit
which a member gets from the AOP/BOI:
(A) shall be included in the total income of a member
(B) shall be included in the total income of a member but a rebate of
income-tax at
the average rate will be allowed as per section 86
(C) shall not be included in the total income of the member
(C)
661) Where the AOP/BOI has paid tax on its income at the rate applicable to individuals, the share of the profit
which a member gets from the AOP/BOI:
(A) shall be included in the total income of a member
(B) shall be included in the total income of a member but a rebate of income-tax at the average
rate will be allowed as per section 86
(C) shall not be included in the total income of the member
(B)
662) The tax on total income exclusive of long-term capital gain is 30 % + 10 %
surcharge + education
cess @ 2 % in case of:
(A) an Indian Company
(B) a Domestic Company
(C) a Foreign Company
(B)
663) The maximum exemption limit in case of a company assessee is:
(A) Rs.10,000
(B) Rs.50,000
(C) Rs.NIL
(C)
664) A surcharge of 10 % on income-tax is payable by:
(A) any Company
(B) an Indian Company
(C) a Domestic Company
(C)
665) A foreign company is chargeable to income-tax:
(A) @ 35 %
(B) @ 35 % + surcharge @ 2.5 % + education cess @ 2 %
(C) @ 40 % + surcharge @ 2.5 %
(D) @ 40 % + surcharge @ 2.5 % + education cess @ 2 %
(D)
666) As per section 115 JB relating to Minimum Alternate Tax, the tax payable by
the assessee shall be
deemed to be:
(A) 10 % of the net profits as per profit & loss account
(B) 10 % of book profits
(C) 10 % of book profits plus surcharge and education cess as applicable
(C)
667) MAT provisions are applicable in case of:
(A) any assessee
(B) a company
(C) a company or a firm
(B)
668) Income-tax on dividend is payable by:
(A) any Indian Company
(B) a Public Limited Company
(C) a shareholder
(D) a Domestic Company
(D)
669) If a company pays tax u/s 115JB the credit for the excess tax paid by the
company can be claimed in
the immediately succeeding:
(A) 5 years
(B) 7 years
(C) 10 years

670) Long-term capital gain which is exempt u/s 10(38) (relating to long-term
shares through stock exchange) shall:
(A) not be included for computing book profits u/s 115JB
(B) be included for computing book profits u/s 115JB

(B)
capital gain on sale of

(B)
671) As per section 139(1), a company shall have to file return of income:
(A) when its total income exceeds Rs.1,00,000
(B) when its total income exceeds the maximum amount which is not
to income-tax
(C) in all cases, irrespective of any income or loss earned by it

chargeable
(C)

672) As per section 139(1), a firm shall have to file return of income:
(A) when its total income exceeds Rs.1,00,000
(B) when its total income exceeds the maximum amount which is not
to income-tax
(C) in all cases, irrespective of any income or loss incurred by it

chargeable

(C)
673) As per section 139(1), an individual other than a senior citizen or a woman
shall have to file return of
income if:
(A) his total income exceeds Rs.1,00,000
(B) his total income exceeds Rs.1,85,000
(C) his total income exceeds Rs.1,35,000
(D) his total income exclusive of deduction u/s 80C to 80U and section
10A, 10B
and 10BA exceeds Rs.1,00,000
(E) his gross total income exceeds Rs.1,00,000
(D)
674) As per section 139(1) an individual, who is a senior citizen shall have to file
return of income if:
(A) his total income exceeds Rs.1,85,000
(B) his gross total income exceeds Rs.1,85,000
(C) his total income exclusive of deduction u/s 80C to 80U and section
10A, 10B
and 10BA exceeds Rs.1,85,000
(D) his total income exclusive of deduction u/s 80C to 80U and section
10A, 10B and
10BA exceeds Rs.1,00,000
(C)
675) As per section 139(1), a person other than a company or a firm shall have to
file return of income if:
(A) his total income exceeds Rs.1,00,000
(B) his total income exceeds the maximum amount which is not chargeable
to tax
(C) his total income exclusive of deduction under Chapter VI and Sections
10A,
10B and 10BA exceeds the maximum amount which is not
chargeable to income-tax
(D) in all cases, irrespective of any income or loss
(D)
676) The total income of a trust before claiming exemption u/s 11 is Rs.1,90,000.
It is eligible for
exemption u/s 11 to the extent of Rs.1,00,000. Such trust
shall:
(A) have to file a return of income
(B) not be required to file return of income as its taxable income is
Rs.90,000
(B)
677) A dies on 15.11.2006 and his total income till 15.11.2006 was Rs.1,10,000.
Thereafter, the business
of A was inherited by his son R and his total income
from such business was Rs.95,000. The son do not
have any other income.
In this case the son:
(A) has to file a consolidated return of income amounting to Rs.2,05,000
(B) has to file two returns of income, one on behalf of his father for
Rs.1,10,000
and other in his own capacity for Rs.95,000
(C) has to file one return of income on behalf of his father for Rs.2.05,000
(D) has to file one return of income on behalf of his father for Rs.1,10,000
(D)
678) The last date of filing the return of income u/s 139(1) for assessment year
2007-08 in case of a
Company assessee is:
(A) 30th November of the assessment year
(B) 31st October of the assessment year
(C) 31st March of the assessment year
(B)
679) The last date of filing the return of income u/s 139(1) for assessment year
2007-08 in case of noncorporate assessee who does not have any income
under the head Profits and gains from business or
profession is:
(A) 31st July of the assessment year

(B)
(C)

31st October of the assessment year


31st March of the assessment year

(A)
680) The last date of filing the return of Income u/s 139(1) for assessment year 2007-08 in case of noncorporate business assessee whose accounts are not
liable to be audited shall be:
(A) 31st July of the assessment year
(B) 30th June of the assessment year
(C) 31st October of the assessment year
(A)
681) The due date of filing the return of income for assessment year 2007-08 in the case of a working partner
of a firm whose accounts are liable to be audited
shall be:
(A) 31st July of the assessment year
(B) 31st October of the assessment year
(C) 30th June of the assessment year
(B)
682) All companies other than those covered u/s 25 are required to file return of income in:
(A) Form No.1
(B) Form No.2
(C) Form No.3
(D) Form No.3A
(A)
683) Assessees other than companies having income under the head Profits and gains from business or
profession are required to file the return in:
(A) Form No.1
(B) Form No.2 or 2D
(C) Form No.3
(D) Form No.3A
(B)
684) e-filing of return in case of a company assessee is:
(A) mandatory
(B) optional
(A)
685) The filing of return of loss is:
(A) mandatory
(B) not mandatory
(C) mandatory if the assessee has to carry forward the loss which are allowed to be carried
forward and set off
(C)
686) If the assessee has to carry forward the loss, the return of loss must be
submitted:
(A) on or before the due date mentioned in section 139(1)
(B) at any time before the end of the relevant assessment year
(C) at any time before the expiry of one year from the end of the relevant
assessment year
(A)
687) If there is a loss under the head house property, it will be allowed to be carried forward (if it could not be
set off from other heads of income). In this case, however, the assessee:
(A) has to submit the return of loss before the due date as mentioned in section 139(1)
(B) need not submit the return of income
(C) must submit the return of income but it can be belated return submitted as per section 139(4)
(C)
688) Belated return u/s 139(4) can be filed at any time:
(A) before the expiry of the relevant assessment year
(B) before the expiry of one year from the end of the relevant assessment year
(C) before the expiry of one year from the end of the relevant assessment year or before the
assessment is complete, whichever happens to be earlier
(C)
689) An assessee was issued notice u/s 142(1)(i) to file his return of income within
30 days of the receipt
of notice. He submitted his return within 30 days. Such return shall be treated as:
(A) belated return as per section 139(4) though filed within time
(B) return filed within time
(C) return filed within due date mentioned u/s 139(1)
(D) return filed within time, if he is neither covered u/s 139(1) or proviso to section 139(1) and
belated return as per section 139(4) though filed within time if he is covered either u/s 139(1) or proviso to
section 139(1)
(D)

690) The assessee could not file his return of income for the assessment year 2006-07 within the time allowed
u/s 139(1). No assessment has so far been made. The assessee in this case can file his return of income till:
(A) 31.3.2008
(B) 31.3.2009
(C) 31.3.2010
(A)
691) The assessee could not file his return of income for the previous year 2006-07 within the time allowed u/s
139(1). No assessment has so far been made. The
assessee in this case can file his return of income till:
(A) 31.3.2008
(B) 31.3.2009
(C) 31.3.2010
(B)
692) The assessee could not file his return of income for assessment year 2005-06 within the time allowed as
per section 139(1). His assessment u/s 144 was completed on 15.1.2007 and it was communicated to him on
19.1.2007. The assessee in this case could file the belated return till:
(A) 14.1.2007
(B) 15.1.2007
(C) 18.1.2007
(A)
693) For the previous year 2005-06 assessee has suffered a business loss of Rs.2,50,000. His income from
other sources is Rs.1,80,000. His due date of return was 31.7.2006 but he submitted he return on 9.9.2006, the
assessee in this case:
(A) shall be allowed to carry forward the loss of Rs.70,000
(B) shall not be allowed to carry forward any loss
(C) shall be allowed to set off current year business loss to the extent of
Rs.1,80,000 but shall not be allowed to carry forward the balance loss of Rs.70,000
(D) shall not be allowed to set off the business loss to the extent of Rs.1,80,000 and would be
liable to tax on Rs.1,80,000
(C)
694) For the previous year 2005-06, the assessee incurred loss under the head,
income from house
property amounting to Rs.1,20,000. His other income for
the same previous year is Rs.50,000. The due
date of filing the return of
income is 31.7.2006 but he submitted the return of income on 9.9.2006. In
this case, the assessee:
(A) shall be allowed to carry forward the loss of Rs.70,000
(B) shall not be allowed to carry forward the loss of Rs.70,000
(A)
695) For the previous year 2005-06, the business income of the assessee, before
providing current year
depreciation of Rs.300,000 was Rs.2,40,000. His due
date for furnishing the return of income was
31.10.2006 but he submitted the
return on 15.12.2006. In this case, the assessee shall:
(A) be allowed to carry forward unabsorbed depreciation of Rs.60,000
(B) not allowed to carry forward unabsorbed depreciation of Rs.60,000
(A)
696) For the previous year 2005-06, the business loss of the assessee was Rs.1,00,000 and the current year
depreciation was Rs.1,40,000. The assessee furnished the return of income on15.12.2006 although the due date
was
31.10.2006. In this case, the assessee shall:
(A) be allowed to carry forward business loss of Rs.1,00,000 and unabsorbed depreciation of
Rs.1,40,000
(B) neither be allowed to carry forward business loss nor the unabsorbed
depreciation
(C) not be allowed to carry forward business loss but shall be allowed to
carry
forward unabsorbed depreciation
(C)
697) The assessee in response to a notice u/s 142(1) submitted a return of loss of
Rs.1,10,000 within the
time allowed in the said notice. In this case the
assessee:
(A) shall be allowed to carry forward such loss as the return is filed within
the time
allowed.
(B) shall not be allowed to carry forward such loss
(B)
698) The due date of furnishing the return of income for assessment year 2007-08
in case of charitable
trust is:
(A) 30th June of the assessment year
(B) 31st July of the assessment year
(C) 31st October of the assessment year
(C)

699) R finds some mistake in the return of income submitted by him on 5.6.2006
for assessment year
2006-07. He wishes to revise such return. No assessment
has been done in this case. R can revise such
return till:
(A) 31.3.2007
(B) 31.3.2008
(C) 31.3.2009
(B)
700) R Ltd., who submitted the return of income for assessment year 2006-07 on
5.12.2006 finds some
mistake in the return submitted by it. In this case R
Ltd.:
(A) can revise the return of income till 31.3.2007
(B) can revise the return of income till 31.3.2008
(C) cannot revise such return of income
(C)
701) R did not file any return of income for assessment year 2006-07 although he
was required to do so by
31.7.2006. He was issued notice u/s 142(1) to file
return of income which he furnished within the time
allowed in the notice. He
later on finds some mistake in the return. In this case R:
(A) can revise such return
(B) cannot revise such return
(C) can revise such return but the loss, if any, cannot be carried forward
(C)
702) R, who submitted his return of income for the assessment year 2006-07 on
31.7.2006, finds some
mistake in the return submitted by him. The
assessment orders u/s 143(3) for such return was passed on
15.2.2007 and
were served to R on 18.2.2007. He could, in this case, revise the return till:
(A) 14.2.2007
(B) 31.3.2008
(C) 17.2.2007
(A)
703) R, who submitted the return of income for assessment year 2006-07 declaring
an income of
Rs.1,80,000. In this case R:
(A) shall be allowed to carry forward such loss
(B) shall not be allowed to carry forward such loss
(A)
704) R submitted his return of income for the assessment year 2006-07 on
29.7.2006. Summary
assessment u/s 143(1) was done on 24.12.2006. A
notice under section 143(2) was thereafter issued. R
wishes to revise the
return as there is some omission in this case:
(A) R cannot revise the return as the assessment has already done
(B) can revise the return till 31.3.2008
(C) can revise the return till 31.3.2008 or before the regular assessment is
completed whichever is earlier
(C)
705) R wishes to revise the return submitted by him within the due date but in the
mean time he received a
notice u/s 143(2) for scrutiny assessment. In this case
R:
(A) can revise the return
(B) cannot revise the return
(A)
706) The Assessing Officer finds some defects in the return submitted by R and
intimated the defect to R,
Vide letter dated 15.10.2006 which was received by
the assessee on 18.10.2006. The assessee in this case
(unless he applies for
extension of time) shall have to rectify the defect by:
(A) 30.10.2006
(B) 29.10.2006
(C) 03.11.2006
(D) 02.11.2006
(D)
707) The self-assessment tax computed u/s 140A by R is Rs.65,000 which includes
Rs.25,000 as interest
for late filing of return. The assessee deposited
Rs.30,000 as self-assessment tax. In this case:
(A) Rs.30,000 shall be adjusted towards tax due
(B) Rs.25,000 shall be adjusted towards interest due and balance Rs.5,000
shall be
adjusted towards tax due
(C) Rs.30,000 shall be adjusted in the proportion of 8 : 5 towards tax and
interest
(B)
708) The Assessing Officer has issued a notice u/s 142(1)(ii) for production of
books of account. Such
notice relates to the assessment of previous year
2006-07. In this case the assessing officer can ask for
books of accounts of:
(A) any past previous year
(B) previous years 2006-07, 2005-06 and 2004-05
(C) previous years 2006-07, 2005-06, 2004-05 and 2003-04

(C)
709) Where the Assessing Officer, as per section 142(2A), has asked the assessee
to get his accounts
audited, the audit report should be submitted within the
maximum period (including extended time of):
(A) 120 days from the date of the directions of audit by the Assessing
Officer
(B) 180 days from the date of the directions of audit by the Assessing
Officer
(C) 180 days from the date of which the directions for audit were received
by the
assessee
(C)
710) The notice u/s 143(2) must be served within:
(A) 12 months from the date of filing the return
(B) 12 months from the due date of filing the return u/s 139(1) or from the
date of
filing of return of income
(C) 12 months from the end of the month in which the return was furnished
(C)
711) Intimation u/s 143(1) cannot be sent after the expiry of:
(A) 4 years from the end of the month in which return of time was
furnished
(B) 2 years from the end of the month in which return of income was
furnished
(C) 2 years from the end of the assessment year in which the income was
so
assessable
(D) One year from the end of the financial year in which the return is made
(D)
712) Return of income of assessment year 2006-07 was furnished on 16.8.2006.
Intimation in respect of
such assessment year must be sent by:
(A) 31.3.2007
(B) 31.3.2008
(C) 31.3.2009
(B)
713) Assessment u/s 143(3) for assessment year 2002-03 was completed
on10.2.2005. Thereafter, on
1.6.2006 the Assessing Officer notices that
income of Rs.72,000 had escaped assessment. The Assessing
Officer in this
case could issue notice till:
(A) 31.3.2006
(B) 31.3.2007
(C) 31.3.2010
(D) 31.3.2009
(B)
714) The last date for issue of notice u/s 148 was 31.3.2006. The Assessing Officer
issued the notice on
31.3.2006 which was received by the assessee on
4.4.2006. In this case, the notice:
(A) is not a valid notice
(B) is a valid notice
(B)
715) Assessment u/s 143(3) for the assessment year 2001-02 was completed on
28.3.2004. On 28.12.2006
the Assessing Officer notices that income of
Rs.90,000 has escaped assessment. The notice u/s 148 in this
case can be
issued till:
(A) 31.3.2006
(B) 31.3.2008
(C) 31.3.2009
(A)
716) Assessment u/s 144 for assessment year 2000-2001 was completed on
25.2.2003 at Rs.3,00,000. On
28.10.2006 the Assessing Officer issued a
notice u/s 148 as the income of Rs.65,000 had escaped
assessment. The
notice issued is:
(A) valid notice
(B) not a valid notice
(B)
717) If the person on whom a notice u/s 148 is to be served is a person treated as
agent of a non-resident,
such notice cannot be issued:
(A) after the expiry of 4 years from the end of the relevant assessment year
for
which notice for reassessment is to be issued
(B) after the expiry of 2 years from the end of the relevant assessment year
(C) after the expiry of 7 years from the end of the relevant assessment year
(B)
718) The time-limit for completion of assessment u/s 143/144 shall be:
(A) 4 years from the end of the relevant assessment year in which income
was first
assessable
(B) 21 months from the end of the relevant assessment year in which
income was
first assessable
(C) 21 months from the end of the month in which the return was so
furnished

(B)
719) The time limit for completion of assessment/reassessment u/s 147 shall be:
(A) 9 months from the end of the financial year in which notice u/s 148
on the assessee
(B) 21 months from the end of the financial year in which notice u/s 148
served
(C) 48 months from the end of the financial year in which notice u/s 148
served
720) The assessee furnished the return of income for the assessment year 2004-05
Assessing Officer in this case should complete the
assessment by:
(A) 31.12.2007
(B) 31.12.2008
(C) 31.03.2007
(D) 31.03.2008

was served
was
was
(A)
on 28.3.2006. The

(A)
721) For assessment year 2001-02, assessment u/s 143(3) was completed on
3.2.2004, assessing the
income at Rs.2,50,000. On 29.3.2007, the Assessing
Officer issued notice for reassessment of income as
he notices a sum of
Rs.1,20,000 has escaped assessment. The above notice was issued on
29.3.2007 but was received by the assessee on 3.4.2007. In this case the
reassessment should be
completed by:
(A) 31.03.2008
(B) 31.12.2007
(C) 02.04.2010
(B)
722) For assessment year 2005-06, the assessment was made the Assessing Officer
u/s 143(3) for
Rs.3,00,000 whereas the income returned was Rs.1,00,000.
The CIT on a revision petition set aside the
above order u/s 264. The said
order was passed by CIT on 29.3.2007 which was received by the Assessing
Officer and the assessee on 3.4.2007. In this case the assessment should be
completed by:
(A) 31.3.2008
(B) 31.3.2009
(C) 29.3.2008
(A)
723) The amendment of an order u/s 154 can be made:
(A) within 4 years from the date when the order sought to be amended was
passed
(B) within 4 years from the date of receipt of such order by the assessee
(C) within 4 years from the end of the financial year in which the order
sought to
be amended was passed
(C)
724) Deduction of tax from salary as per section 192 shall be:
(A) @ 10 % of salary
(B) at the average rate of income-tax computed on the basis of rates in
force for
the financial year in which payment is made
(C) at the maximum rate of 30 %
(B)
725) The deduction of tax at source from the salary shall be made at the time of:
(A) accrual of salary
(B) payment of salary
(C) credit or payment of the salary, whichever is earlier
(B)
726) The salary for the purpose of deduction of tax at source shall be rounded off to
the nearest:
(A) Rupee one
(B) Rupees ten
(C) Rupees hundred
(B)
727) The liability to deduct tax at source in case of income from interest on
securities arises at the time of:
(A) payment of interest
(B) accrual of interest
(C) credit of interest to the account of the payee/interest payable account or
payment thereof whichever is earlier
(C)
728) No deduction of tax at source on interest on listed debentures is to be done by
the widely held
company:
(A) if the interest is paid by cheque

(B) if the interest is paid by account payee cheque and the amount of
or payable during the financial year does not exceed
Rs.2,500
(C) same as (B), but interest is paid or payable to an individual who is
India
(C)

interest paid
resident in

729) The rate of TDS in the case of listed debentures for the financial year 2006-07
is:
(A) 20 %
(B) 21 %
(C) 10 %
(D) 10 %, but where income exceeds Rs.8,50,000, 10 % plus surcharge @
10 %
(E) 10 % plus surcharge @ 10 % plus education cess @ 2 % if the
payment is
made to an assessee other than individual, HUF and AOP.
Where payment is made to an
individual, HUF and AOP 10 %.
Surcharge @ 10 % shall be leviable only where the income
exceeds
Rs.10,00,000 and education cess of 2 % on tax + surcharge
(E)
730) (i) R, an individual, who is not carrying on a business has borrowed a sum of
Rs.1,00,000 on
1.4.2006 @ 18 % p.a. from a Finance Company. R in this
case should deduct tax on such interest paid
amounting to:
(A) Rs.1,845
(B) Rs.2,020
(C) Rs.4,029
(D) Rs.NIL
(D)
(ii) What shall be your answer in the above case if R had been carrying on a
business and its
turnover of the preceding previous year exceeds
Rs.50,00,000.
(B)
(iii) What shall be your answer in the above case if R had been carrying on a
business and its
turnover of the preceding previous year was Rs.35,00,000
and the turnover of the current previous year
is Rs.45,00,000.
(D)
731) (i) R has deposited a sum of Rs.1,00,000 on 1.4.2006 with a scheduled bank
for one year at the
interest rate of 6 % p.a. The bank should deduct tax at
source amounting to:
(A) Rs.673
(B) Rs.612
(C) Rs.1,200
(D) Rs.1,224
(E) Rs.1,346
(B)
(ii) R deposited a sum of Rs.1,00,00,000 with a scheduled bank for a year at the
interest rate of 6
% p.a. The bank should deduct tax at source amounting to:
(A) Rs.66,000
(B) Rs.61,200
(C) Rs.1,32,000
(D) Rs.67,320
(E) Rs.1,34,640
(D)
732) R has won a State Government Lottery of Rs.1,00,000 on 11.10.2006. The
State Government should
deduct tax on such winning amounting to:
(A) Rs.30,000
(B) Rs.33,000
(C) Rs.29,070
(D) Rs.30,600
(D)
733) (i) R has a horse race on 11.10.2006 and is entitled to a prize of Rs.2,00,000.
The race club should
deduct the tax at source amounting to:
(A) Rs.66,000
(B) Rs.60,000
(C) Rs.60,435
(D) Rs.61,200
(D)
(ii) R has won the horse race and is entitled to a prize of Rs.12,00,000. The
race club should
deduct the tax at source amounting to:
(A) Rs.3,67,200
(B) Rs.3,96,000
(C) Rs.4,03,920
(C)

734) R, an individual has engaged a contractor for building his house. On


5.11.2006, R has made a
payment of Rs.1,00,000 to the contractor. R should
deduct the tax at source amounting to:
(A) Rs.2,040
(B) Rs.2,200
(C) Rs.10,000
(D) Rs.1,020
(E) Rs.NIL
(E)
735) A company has given an advertising contract to an advertising agency which
is also a company. On
5.11.2006, it has paid a sum of Rs.2,40,000 to the
advertising agency. The company should deduct tax
amounting to:
(A) Rs.2,693
(B) Rs.5,386
(C) Rs.2,400
(D) Rs.2,640
(E) Rs.5,280
(A)
736) R Ltd., a firm of contractors have given some works contract to G Ltd. On
6.10.2006, it has made a
payment of Rs.4,00,000 to G Ltd. R Ltd., should
deduct tax amounting to:
(A) Rs.8,000
(B) Rs.4,488
(C) Rs.8,976
(D) Rs.4,400
(E) Rs.8,800
(B)
737) (i) R & Sons, a HUF is carrying on business and whose turnover of the last
year was
Rs.45,00,000; got tax audit done from a firm of Chartered
Accountants for the current previous year
2006-07. An audit fee of
Rs.30,000 was paid by R & Sons during the previous year 2006-07. R &
Sons should deduct tax amounting to:
(A) Rs.1,500
(B) Rs.1,650
(C) Rs.1,683
(D) Rs.673
(E) Rs.NIL
(C)
(ii) What shall be your answer if in the above case, the turnover of HUF in the
last year was
Rs.39,00,000 instead of Rs.45,00,000.
(E)
738) (i) Ahuja Continental Ltd., has credited a sum of Rs.80,000 on account of its
Chartered
Accountants, a sole proprietary firm during the previous year
2006-07. The company should deduct tax
amounting to:
(A) Rs.4,000
(B) Rs.4,400
(C) Rs.4,080
(D) Rs.4,488
(E) Rs.NIL
(C)
(ii) Ahuja Continental Ltd., has credited a sum of Rs.12,00,000 to the account
of its Chartered
Accountants, a sole proprietary firm during the previous
year 2006-07. The company should deduct
tax amounting to:
(A) Rs.60,000
(B) Rs.66,000
(C) Rs.67,320
(D) Rs.NIL
(C)
739) No tax is to be deducted at source if the amount credited/paid to the contractor
during the relevant
previous year does not exceed:
(A) Rs.20,000
(B) Rs.50,000
(C) Rs.20,000 at one time or Rs.50,000 in aggregate in the financial year
(C)
740) No tax is to be deducted at source if the amount credited/paid during the
previous year as fee for
profession or technical services does not exceed:
(A) Rs.10,000
(B) Rs.20,000
(C) Rs.50,000

(B)
741) R Ltd., has taken a house on rent @ Rs.15,000 p.m. from G an individual. R
Ltd., should deduct tax
on account of such rent paid/credited amounting to:
(A) Rs.36,000
(B) Rs.36,720
(C) Rs.27,000
(D) Rs.27,540
(D)
742) R Ltd., has taken a showroom on rent @ Rs.15,000p.m. from G Ltd. R Ltd.,
should deduct tax at
source amounting to:
(A) Rs.36,000
(B) Rs.36,900
(C) Rs.40,392
(D) Rs.39,600
(E) Rs.37,638
(C)
743) R Ltd., has taken a house on rent on 1.11.2006 @ Rs.20,000 p.m. from G Ltd.
R Ltd., should deduct
tax at source amounting to:
(A) Rs.15,000
(B) Rs.15,750
(C) Rs.20,000
(D) Rs.20,500
(E) Rs.NIL
(E)
744) The advance tax is payable by the assessee if the advance tax payable during
the year:
(A) exceeds Rs.1,500
(B) exceeds Rs.5,000
(C) is Rs.5,000 or more
(C)
745) The first instalment of advance tax in case of a company assessee should be
made:
(A) on or before 15th June
(B) on or before 15th July
(C) on or before 15th September
(A)
746) The first instalment of advance tax in case of a non-company assessee should
be made:
(A) on or before 15th June
(B) on or before 15th September
(C) on or before 15th October
(B)
747) The amount of advance tax payable by the company assessee on or before 15th
June shall be:
(A) 30 % of the advance tax payable
(B) 15 % of the advance tax payable
(C) 12 % of the advance tax payable
(B)
748) A company assessee has to make the payment of advance tax:
(A) in 3 instalments
(B) in 4 instalments
(C) every month
(B)
749) A non-company assessee has to make payment of advance tax:
(A) in 4 instalments
(B) in 3 instalments
(C) every month
750) Advance tax is payable by:
(A) a company assessee only
(B) an assessee other than individual or HUF
(C) any assessee

(B)

(C)
751) Advance tax can:
(A) be paid after 15th March of the relevant financial year
(B) not be paid after 15th March
(C) be paid after 15th March but by 31st March of the relevant financial

year
(C)

752) The advance tax is payable by the assessee:


(A) on his own account
(B) only when the order for payment is passed by the Assessing Officer

(C)

on his own account or when the order for payment is passed by the

Assessing

Officer
(C)
753) R submitted his return of income for the assessment year 2006-07 on
15.1.2007. The due date for
filing the return of income in his case was
31.10.2006. R in this case shall have to pay interest:
(A) 1.25 % per month or part of the month
(B) 1 % per month of part of the month
(C) 1.5 % per month or part of the month
(B)
754) In the above case R shall have to pay interest for:
(A) 3 months
(B) 2 months
(C) 2.5 months
(A)
755) R did not file his return of income for the assessment year 2006-07. The due
date of filing the return
was 31.10.2006. His income was assessed under
section 144 on 5.3.2008. R shall have to pay interest for:
(A) 16 months
(B) 17 months
(C) 12 months
(C)
756) Interest shall be payable u/s 234B if the advance tax paid by the assessee
during the financial year is:
(A) less than the assessed tax
(B) less than 90 % of the assessed tax
(C) less than 90 % of tax payable on the returned income
(B)
757) Interest u/s 234B for default in payment of advance tax is payable:
(A) for the period starting from due date of return to the date of assessment
(B) for the period starting from 1st April of the relevant assessment year to
the date
of assessment
(C) for the period starting from 1st April of relevant assessment year to the
date of
submission of return
(B)
758) Interest for default in payment of advance tax for assessment year 2007-08
shall be payable @:
(A) 1.25 % per month or part of the month
(B) 1 % per month or part of the month
(C) 1.5 % per month or part of the month
(D) 3 % per month or part of the month
(B)
759) Interest for deferment of advance tax as per section 234C for assessment year
2007-08 shall be
payable @:
(A) 1.5 % per month or part of the month
(B) 1.25 % per month or part of the month
(C) 1 % per month or part of the month
(C)
760) The first instalment of advance tax of Rs.15,000 was due 15.9.2006, the
assessee deposited the
money on 16.9.2006. In this case interest will be
payable @ 1 % per month on Rs.15,000 for:
(A) 1 day
(B) 1 month
(C) 3 months
(C)
761) The first instalment of advance tax of Rs.15,000 was due on 15.9.2006. The
assessee deposited
Rs.10,000 on 14.8.2006 and balance on 16.11.2006/ In
this case interest shall be payable @ 1 % p.m. on:
(A) Rs.15,000 for 3 months
(B) Rs.5,000 for 3 months
(C) Rs.5,000 for 2 months
(B)
762) The last instalment of Rs.15,000 of advance tax due on 15.3.2007 is deposited
by the assessee on
25.3.2007. In this case the assessee shall have to pay
interest @ 1 % per month for:
(A) 3 months
(B) 1 month
(C) 10 days
(B)
763) The last instalment of Rs.15,000 of advance tax due on 15.3.2006 was
deposited on 2.4.2006. In this
case, the amount deposited:
(A) shall be treated as advance tax but the assessee shall have to pay
interest @ 1 %
per month
(B) shall not be treated as advance tax and no interest shall be payable u/s
234C

(C) shall not be treated as advance tax and the interest will be payable u/s
1 % for one month

234C @

(C)
764) Where an assessee has submitted a return of income and any refund of Incometax is due to him, he
is:
(A) required to file a claim for such refund in a prescribed form
(B) not required to file any claim for such refund and it will be granted by
Assessing Officer Suo Moto
(B)
765) Where any refund arises due to an order of appeal, rectification of mistakes,
revision/appeal to High
Court, the assessee in this case is:
(A) required to file a claim for such refund in a prescribed manner
(B) not required to file any claim for such refund and it will be granted by
Assessing Officer Suo Moto
(B)
766) Where tax has been deducted at source, but the total income of the assessee is
not more than the
maximum exemption limit on which no income-tax is
payable, the assessee is:
(A) required to file a claim for refund
(B) not required to file any claim for refund and it will be granted by the
Assessing
Officer Suo Moto
(A)
767) If any person is not required to file any return of income as per section 139(1)
but any refund of
income-tax is due to him, he:
(A) is required to file claim for refund of such income-tax
(B) is not required to file claim for such refund and it will be granted by
the
Assessing Officer Suo Motu
(A)
768) The application for refund in Form No.30 should be made:
(A) within 2 years from the last day of the relevant assessment year
(B) within 1 year from the last day of the relevant assessment year
(C) any time by the assessee
(B)
769) The application for refund of tax shall be made in:
(A) Form No.28
(B) Form No.30
(C) Form No.35
(B)
770) Where the income of one person is included under any provision of the
Income-tax Act in the total
income of any other person, the person entitled to
refund shall be:
(A) the person whose income has been included in the income of other
person
(B) the person in whose income, income of other person is included
(B)
771) Where due to death, a person is unable to claim refund, such refund can:
(A) be claimed by his legal representative
(B) not be claimed by his legal representative
(A)
772) Where due to any order passed in the appeal, an assessment is set aside or
cancelled and order of
fresh assessment is directed to be made, the refund, if
any, shall:
(A) become due immediately
(B) become due only on the making of such fresh assessment
(B)
773) Where due to order passed in the appeal, the assessment is annulled, the
refund:
(A) of entire amount shall become due
(B) of that amount shall become due which is paid in excess of the tax
chargeable
on the total income returned by the assessee
(C) of that amount shall become due which is in excess of the amount
assessed by
the Assessing Officer
(B)
774) The Assessing Officer has:
(A) no power to withhold refund
(B) power to withhold refund
(C) power to withhold refund with the prior approval of Chief
Commissioner of
Income Tax
(A)

775) Belated claim for refund:


(A) can be made by the assessee
(B) can be made by the assessee provided the Assessing Officer condones
delay
(C) can be made by the assessee provided the Assessing Officer condones
based on certain conditions being satisfied
776) If any tax or any other demand is outstanding against the assessee for any
Assessing Officer has:
(A) no power to set off the refund due to the assessee against such
(B) power to set off the refund due to the assessee against such tax/demand
(C) power to set off the refund due to the assessee but after intimation in
such person

such
the delay

(C)
assessment year, the
tax/demand
writing to
(C)

777) Refund due to the firm can:


(A) be adjusted against the tax liability of the individual partners
(B) not be adjusted against the tax liability of the individual partners
(B)
778) The minimum and maximum penalty under section 221(1) for failure to pay
the whole or any part of
income-tax or interest or both in accordance with the
provisions of section 140A(1) shall be:
(A) such amount as Assessing Officer may impose for default or
continuing default
(B) same as mentioned as Clause (A) above subject to maximum of
amount of tax
in arrears
(C) 100 % tax in arrears subject to maximum of 300 % of tax in arrears
(B)
779) The minimum penalty for failure to comply with a notice under section 142(1)
shall be:
(A) Rs.1,000
(B) Rs.10,000
(C) Rs.5,000
(B)
780) The maximum penalty for failure to comply with a notice u/s 142(1) shall be:
(A) Rs.25,000
(B) Rs.15,000
(C) Rs.10,000
(C)
781) The minimum and maximum penalty under section 271(1)(b) for failure to
comply with a notice
issued u/s 143(2) shall be:
(A) Rs.1,000 and Rs.25,000 respectively
(B) Rs.10,000
(C) Rs.25,000
(B)
782) The minimum and maximum penalty for failure to comply with a direction
regarding getting of
accounts audited under section 143(2A) shall be:
(A) Rs.25,000
(B) Rs.10,000
(C) Rs.1,000 and Rs.25,000 respectively
(B)
783) The minimum and maximum penalty u/s 271(1)(c) for concealing particulars
of income or
furnishing inaccurate particulars of such income shall be:
(A) 100 % of the amount of tax sought to be evaded and 300 % of such tax
respectively
(B) 100 % of the amount of tax sought to be evaded and 200 % of such tax
respectively
(C) 100 % of the amount of the income sought to be evaded and 300 % of
such
income
(A)
784) The minimum and maximum penalty u/s 271A for failure to keep, maintain or
retain books of
accounts, documents, etc., as required u/s 44AA shall be:
(A) Rs.2,000 and Rs.1,00,000 respectively
(B) Rs.1,00,000
(C) Rs.25,000
(C)
785) The minimum and maximum penalty u/s 271B for failure to get accounts
audited or to furnish a
report of such audit as required u/s 44AB shall be:
(A) Rs.2,000 and Rs.1,00,000 respectively
(B) % of total sales/turnover/gross receipts as the case may be and
Rs.1,00,000
respectively

(C)

10 % of total sales, etc., andRs.1,00,000 respectively

(B)
786) The minimum and maximum penalty u/s 271C for failure to deduct the whole
or any part of tax under
TDS provisions shall be:
(A) amount equal to tax which has not been deducted and 200 % of such
tax
respectively
(B) amount equal to tax which has not been deducted and 300 % of such
tax
respectively
(C) amount equal to tax which has not been deducted
(C)
787) The minimum and maximum penalty u/s 271D for any loan or deposit taken
or accepted in
contravention of section 269SS shall be:
(A) amount equal to loan or deposit taken or accepted and 200 % of such
amount
respectively
(B) amount equal to loan or deposit taken or accepted and 300 % of such
amount
respectively
(C) amount equal to loan or deposit taken or accepted
(C)
788) The minimum and maximum penalty u/s 271E for any deposit which is repaid
in contravention of
section 269T shall be:
(A) amount equal to the deposit which is repaid and 200 % of such deposit
respectively
(B) amount equal to the deposit which is repaid and 300 % of such deposit
respectively
(C) amount equal to the deposit which is repaid
(C)
789) The penalty u/s 271F for failure to furnish a return of income shall be leviable
if the return is
submitted after:
(A) the due date mentioned u/s 139(1)
(B) the end of the relevant assessment year
(C) 12 months for the due date mentioned u/s 139(1)
(B)
790) The penalty u/s 271F for failure to furnish the return of income before the end
of the relevant
assessment year shall be:
(A) Rs.500
(B) Rs.5,000
(C) Rs.1,000
(B)
791) The penalty u/s 271F for failure to furnish a return of income as required by
first proviso to section
139(1) is leviable, if the return is furnished after:
(A) the due date mentioned u/s 139(1)
(B) the end of the relevant assessment year
(C) 12 months from the due date mentioned u/s 139(1)
(B)
792) The penalty u/s 271F for failure to furnish return of income as required by
first proviso to section
139(1) on or before the due date mentioned u/s 139(1)
shall be:
(A) Rs.5,000
(B) Rs.1,000
(C) Rs.500
(A)
793) The minimum and maximum penalty u/s 272A(1)(d) for failure to apply for
allotment of PAN u/s
139A or quote such number in Challans, etc., shall be:
(A) Rs.500
(B) Rs.500 and Rs.5,000
(C) Rs.10,000
(C)
794) The minimum and maximum period of rigorous imprisonment u/s 275A for
in contravention of the order made u/s132(3) shall
be:
(A) any period up to 1 year and fine
(B) any period up to 2 years and fine
(C) any period up to 3 years and fine
795) The minimum and maximum period of rigorous imprisonment u/s 276 for
transfer or delivery of property to thwart tax recovery
shall be:

dealing with seized assets

(B)
removal, concealment,

(A) any period up to 1 year and fine


(B) any period up to 2 years and fine
(C) any period up to 3 years and fine
796) Wilful failure to furnish return of income in time u/s 139(1) or in response to
section 148 if tax evaded exceeds Rs.1,00,000 shall be:
(A) minimum 3 months rigorous imprisonment and fine and maximum
and fine
(B) minimum 6 months rigorous imprisonment and fine and maximum
and fine
(C) minimum 1 year rigorous imprisonment and fine and maximum
and fine
797) Wilful failure to file return of income in time u/s 139(1) or in response to a
section 148 if tax evaded does not exceed Rs.1,00,000
shall be:
(A) minimum 3 months rigorous imprisonment and fine and maximum
and fine as per section 276CC
(B) minimum 6 months rigorous imprisonment and fine and maximum
and fine as per section 276CC

(B)
notice u/s 142(1) or
3 years
7 years
10 years
(B)
notice u/s 142(1) or
3 years
7 years
(A)

798) No prosecution u/s 276CC if:


(A) the return is filed before expiry of the assessment year
(B) the tax payable on regular assessment as reduced by TDS and advance
not exceed Rs.3,000
(C) the return is filed before expiry of the assessment year or the tax
regular assessment as reduced by TDS and advance tax
does not exceed Rs.3,000

tax does
payable on

(C)
799) Wilful failure to produce books of accounts and documents u/s 142(1) or
failure to comply with a
direction to get the accounts audited u/s 142(2A) will
attract rigorous imprisonment:
(A) up to 1 year
(B) up to 1 year and fine of Rs.4 for every day during which default
continues
(C) up to 1 year minimum and fine of Rs.4 and maximum of Rs.10 per
every day
during which default continues
(C)
800) The first appeal against the order of the Assessing Officer lies with:
(A) Deputy Commissioner (Appeals)
(B) Commissioner (Appeals)
(C) Appellate Tribunal
(B)
801) The first appeal can be filed by:
(A) the assessee only
(B) Assessing Officer only
(C) either the assessee or the Assessing Officer
(A)
802) If the assessee is not satisfied with any order passed by the Assessing Officer,
(A) file appeal to Commissioner (Appeal)
(B) apply for revision to the CIT u/s 264
(C) either file appeal or apply for revision u/s 264
(D) file appeal as well as apply for revision

he can:

(C)
803) The appeal against the order of Commissioner (Appeals) can be filed by:
(A) an assessee only
(B) an Assessing Officer only subject to approval of CIT
(C) either by the assessee or the Assessing Officer subject to approval of
804) If the assessee or the Assessing Officer is not satisfied with the order of
second appeal lies to:
(A) High Court directly
(B) Appellate Tribunal
(C) High Court on a reference by the Appellate Tribunal

CIT

(C)
Commissioner (Appeals), the

805) If the assessee or the CIT is not satisfied with the order of Appellate Tribunal,
(A) request the Appellate Tribunal to refer the matter to the High Court
(B) file the appeal direct to High Court

(B)
then either of them can:

(C) file the appeal either to High Court or Supreme Court if there are
decision by the various High Courts

conflicting
(B)

806) The appeal against the order of Appellate Tribunal can be filed in High Court:
(A) for any matter in the order
(B) only if any question of fact is involved
(C) only if any question of law is involved
(C)
807) The first appeal to Commissioner (Appeals) must be filed in:
(A) Form No.35
(B) Form No.36
(C) Form No.36A
(A)
808) The first appeal against the order of the Assessing Officer can be filed within
(A) 30 days from the date of the order
(B) 30 days from the date of service of the order to the assessee
(C) one month from the date of the service of the order to the assessee

a period of:

809) If the appeal against the order of the Assessing Officer was not filed within 30
the assessee:
(A) has no option left with him
(B) can apply for condonation of delay
(C) can either apply for condonation of delay or apply for revision u/s 264
(D) can only apply for revision u/s 264

(B)
days as required then

(D)
810) The order passed by the Commissioner (Appeals) should be communicated to:
(A) assessee
(B) CIT who has jurisdiction over the case
(C) both to the assessee and CIT
(D) the assessee through CIT
(C)
811) The Commissioner (Appeals) should decide the appeal:
(A) within one year from the date of filing of the appeal
(B) one year from the end of the financial year in which appeal is filed
(C) as far as possible within one year from the end of the financial year in
appeal is filed before him

before him
which

(C)
812) An assessee who submitted a return declaring an income of Rs.90,000 was
assessed by the Assessing
Officer at Rs.1,60,000. He wishes to file an appeal.
The fee for filing appeal should be:
(A) Rs.250
(B) Rs.500
(C) non-Judicial stamp of 50 paise
(D) Rs.1,000
(B)
813) The assessee wishes to file an appeal against the order of ITO for levying a
penalty for TDS default.
The fee for filing such appeal shall be:
(A) Rs.250
(B) Rs.500
(C) Rs.1,000
(A)
814) The time limit for filing an appeal to the Appellate Tribunal is:
(A) 30 days from the receipt of the order to be appealed against
(B) 30 days from the passing of the order to be appealed against
(C) 60 days from the receipt of the order to be appealed against
(D) 60 days from the passing of the order to be appealed against
(C)
815) The appeal to the Appellate Tribunal should be made in:
(A) Form No.35
(B) Form No.36
(C) Form No.36A
(B)
816) The time limit for filing memorandum of cross objection to Appellate
Tribunal shall be:
(A) 60 days from the receipt of notice that appeal has been filed by the
other party
(B) 30 days from the receipt of notice that appeal has been filed by the
other party
(C) 90 days from the receipt of such notice
(B)

817) The memorandum of cross objection must be filed in:


(A) Form No.36
(B) Form No.36A
(C) Form No.37
(B)
818) The delay in filing appeal or memorandum of cross objection to Appellate
(A) be condoned by the Appellate Tribunal
(B) not be condoned
(C) be condoned by the CBDT

Tribunal can:

(A)
819) The total income assessed by the Assessing Officer was Rs.4,50,000. The
assessee wishes to file an
appeal to Appellate Tribunal as he was not satisfied
with the order of Commissioner (Appeals). The fee
for filing such appeal
shall be:
(A) Rs.1,500
(B) Rs.2,500
(C) Rs.4,500
(D) Rs.10,000
(C)
820) The maximum fee for filing an appeal to Appellate Tribunal is:
(A) Rs.5,000
(B) 1 % of the assessed income
(C) 1 % of the assessed income subject to a maximum of Rs.10,000
(C)
821) Revision u/s 263 is to be done by the Commissioner:
(A) on his own motion
(B) on the request of the Assessee
(C) on the request of the Assessing Officer
(D) on his own motion or on the request of the assessee or the Assessing
Officer
(A)
822) The Commissioner cannot revise the order of the Assessing Officer under
section 263 after the expiry
of:
(A) one year from the end of the financial year in which order sought to be
revised
was passed
(B) 2 years from the end of the financial year in which order sought to be
revised
was passed
(C) 2 years from the date of such order
(B)
823) Revision of order not covered by section 263 can be done by the
Commissioner:
(A) on his own motion
(B) on the request of the assessee
(C) on the request of the Assessing Officer
(D) on his own motion or on the request of the assessee
(E) on his own motion or on the request of the assessee/Assessing Officer
(D)
824) The Commissioner shall not revise the order u/s 264:
(A) where an order has been made more than one year previously
(B) where an order has been made more than 2 years previously
(C) where an order has been made more than 4 years previously
(A)
825) The Central Board of Direct taxes is:
(A) an Income-tax Authority under the Income-tax Act
(B) not an Income-tax Authority under the Income-tax Act
(A)
826) The Income Tax Appellate Tribunal is:
(A) an Income-tax Authority under the Income-tax Act
(B) not an Income-tax Authority under the Income-tax Act
(B)
827) The Inspector of Income-tax is:
(A) an Income-tax Authority under the Income-tax Act
(B) not an Income-tax Authority under the Income-tax Act
(A)
828) Income-tax Authority below the rank of Deputy Commissioner of Income-tax:
(A) is appointed by the Central Board of Direct Taxes
(B) may
be
appointed
by
the
Board/Director
General/Chief
Commissioner/
Director/Commissioner if authorised by the Board
(C) is appointed only the Central Government

(B)
829) The Board may issue:
(A) any order, instructions and directions to other Income-tax Authorities
as it may
deem fit for the proper Administration of the Income-tax Act
(B) any order, instructions and directions as (A) above but cannot require
income
tax authority to make an assessment or to dispose off a
particular case in a particular manner
(C) any order, instructions and directions as per clause (A) above but
cannot
interfere with the discretion of the Commissioner (Appeals) in
the exercise of his appellate
functions
(D) any order, instructions and directions as per clause (A) above but
subject to
clauses (B) & (C) above
(D)
830) The Board may by general or special order:
(A) authorize any income-tax authority to admit an application of claim for
any
exemption, deduction, refund or any other relief under this Act,
after the expiry of the period
specified by or under the Income-tax Act
in this respect
(B) same as clause (A) above but such order cannot be issued to
Commissioner
(Appeals)
(B)
831) The circulars issued by the Board are:
(A) binding on assessee as well as Income-tax Authorities
(B) binding on Income-tax Authority
(C) neither binding on Income-tax Authorities nor on the assessee
(B)
832) The Board has:
(A) power to relax any requirement contained in any of the provisions of
Chapter
IV or Chapter VIA subject to certain conditions
(B) no power to relax requirements of Chapter IV & VIA
(C) power to relax such requirements but the Central Government shall get
the
approval of Parliament
(D) power to relax such requirement but the Central Government shall
cause every
such order to be laid before each house of Parliament
(D)
833) A Circular of the Central Board of Direct Taxes u/s 119 of the Income Tax
Act,1961:
(A) can override or detract from the Act
(B) cannot override or detract from the Act
(B)
834) A circular in matters relating to the general interpretation of any provisions of
the Statute:
(A) shall be binding on any Income Tax Authority
(B) shall be binding on any Income Tax Authority except Commissioner
(Appeals)
(C) shall be binding on any Income Tax Authority as well as Tribunal
(A)
835) Income Tax Authorities shall exercise all or any of the powers and perform
all or any of the functions
conferred on them in accordance with the
directions:
(A) issued by the Board only
(B) issued by the Board or any other income-tax authority authorized by
the Board
(C) issued by Director General/Chief Commissioner of Income-tax
(B)
836) The jurisdiction of the Assessing Officer shall be in case of any person:
(A) who is carrying on business or profession within the area vested with
him
(B) who is having place of residence within that area
(C) who is carrying on business or profession or having place of residence
within
that area
(C)
837) Where a person is carrying on business or profession in more places than one,
the jurisdiction of such
person shall be with:
(A) each Assessing Officer in whose jurisdiction such person carries on
such
business
(B) that Assessing Officer in whose jurisdiction the principal place of
business or
profession is situated
(B)
838) Any dispute relating to jurisdiction of an Assessing Officer to assess any
person shall be determined
by:
(A) The Board
(B) The Director General/Chief Commissioner or Commissioner of
Income Tax
(C) Joint Commissioner/Joint Director of Income-tax
(B)

839) The assessee can object to the jurisdiction of Assessing Officer, if no return is
filed:
(A) within 3 months of notice u/s 142(1) or 148 for filing the return of
income or
time allowed to show cause why best judgement u/s 144
should not be made, whichever is earlier
(B) within one month of notice u/s 142(1) or 148 for filing the return of
income or
time allowed to show cause why best judgement u/s 144
should not be made, whichever is earlier
(C) within the time allowed in notice u/s 142(1) or 148 for filing return of
income
or time allowed to show cause u/s 144 whichever is earlier
(C)
840) Where an assessee has already filed a return of income, he can object to the
jurisdiction of Assessing
Officer:
(A) within one month from the date of service of notice u/s 142(1)/143(2)
(B)
within one month from the date of service of notice issued
u/s 142(1)/143(2) or
before completion of assessment whichever is
earlier
(C) within one month from the date of issue of notice u/s 142(1)/143(2)
(B)
841) Search and seizure can be authorized by:
(A) Director General/Chief Commissioner/Director/Commissioner
(B) Director
General/Chief
Commissioner/Director/Commissioner/Joint
Commissioner/Joint Director
(C) Any Income-tax Authority
(B)
842) Power regarding discovery, production of evidence, etc., u/s 131 can be
exercised by any Income-tax
Authority:
(A) if any proceedings are pending under the Income-tax Act
(B) whether or not any proceedings are pending under the Income-tax Act
(B)
843) The Income-tax Authority can conduct the Survey:
(A) any time
(B) only during the hours at which the place of business or profession is open for the conduct of
such business or profession
(C) between 10 A.M. and 6 P.M.
(B)
***

RAE I
INCOME TAX (THEORY)
November 2007
Time: 2 hours
Note:
1.
2.
1.

2.

3.

4.

5.

6.

7.

8.

Max. marks 100

This question paper contains 100 questions and has 13 pages.


Each question carries 1 mark.
*
*
Choose the correct answer:
The amount of any compensation received by an assessee from his former employer in connection with
the termination of his employment is to be considered as part of:
(a) Salary
(b) Perquisite
(c) Profits in lieu of salary
(d) Fringe benefits
(c)
Unrealised rent in respect of house property, which is realized subsequently by the assessee, is to be
charged to Income Tax as the income of:
(a) The year in which the rent was due
(b) That previous year in which in which the rent is realized
(c) That previous year in which the property was let out
(b)
Special provisions in respect of certain undertakings in certain special category states is dealt with
under Section:
(a) 80 IC
(b) 10 B
(c) 33 AB
(d) 10 C
(a)
Deduction in respect of a professional sportsman resident in India having professional income from
foreign sources is to be limited to:
(a) 15 per cent of such income for assessment year 2004-05
(b) 35 per cent of such income for assessment year 2004-05
(c) 45 per cent of such income for assessment year 2004-05
(d) 60 per cent of such income for assessment year 2004-05
(a)
For deriving the book profit of a company for the purpose of MAT, the net profit as per the Profit &
Loss Account should not be increased by:
(a) Provision for income tax payable
(b) Provision for losses of subsidiary companies
(c) Amount withdrawn from any reserves
(d) Amount of dividend paid
(c)

The period for carry forward of MAT credit pertaining to section 115 JB for any assessment year on or
after 1st April 2006 shall be limited to:
(a) Second succeeding assessment year
(b) Fifth succeeding assessment year
(c) Third succeeding assessment year
(d) Seventh succeeding assessment year
(d)
Subject to other conditions, the TDS on payment of compensation on acquisition of certain immovable
property shall equal:
(a) 20 per cent of the compensation
(b) 2 per cent of the compensation
(c) 10 per cent of the compensation
(d) 30 per cent of the compensation
(c)
The TCS collected from the licensee is to be limited to 2 per cent of the amount payable by the licensee
in respect of:
(a) Parking lot
(b) Toll Plaza

(c) Both a & b


(d) Neither (a) nor (b)
(c)
9.

Commission on sale of lottery tickets and TDS thereto, is dealt with under Section:
(a) 194 I
(b) 194 G
(c) 195
(d) 206
(b)

10. Advance Tax is payable by an assessee in case such tax computed and payable for that year exceeds
rupees:
(a) 5,000
(b) 50,000
(c) 20,000
(d) 1,00,000
(a)
11. Penalty is imposable for failure to maintain books of account under section:
(a) 271
(b) 271 A
(c) 271 AA
(d) 271 AAA
(b)
12. Penalty for failure to deduct tax at source is equal to:
(a) 50 per cent of the amount not deducted
(b) The amount not deducted
(c) Double the amount not deducted
(d) No penalty
(b)

13. Penalty for failure to furnish return of fringe benefits is applicable from:
(a) Assessment year 2004-05
(b) Assessment year 2007-08
(c) Assessment year 2006-07
(d) Assessment year 2005-06
(b)
14. Wilful attempt to evade tax is punishable under Section:
(a) 276 C
(b) 276
(c) 278 A
(d) Both a & c
(a)
15. Obligation to furnish Annual information return rests on some specified:
(a) Assessing officers
(b) Assessees
(c) Local authorities
(d) a & b
(e) b & c
(e)
16. Rules for carrying out the purposes of the Income Tax Act are notified by:
(a) CBDT
(b) Parliament
(c) Prime Minister
(d) Finance Minister
(a)
17. Interest for deferment of advance tax is payable under section 234 C:
(a) Yes
(b) No
(a)
18. Under Section 234 A, an assessee is liable to pay simple interest on the amount of tax on the total
income with effect from 8.9.2003 the rate of interest payable per month is:
(a) 1 per cent
(b) 1.25 per cent
(c) 1.5 per cent
(d) 1.75 per cent

(a)
19. Provisions of Section 234 B are applicable in respect of assessments for the assessment year 2000-01
and onwards:
(a) Yes
(b) No
(b)
20. Attachment and sale of an assessees immovable property is a permissible means for recovery by a
TRO.
(a) Yes
(b) No
(a)
21. Previous year means:
(a) The Calendar year immediately preceding the assessment year
(b) The financial year immediately preceding the assessment year
(c) The Calendar year overlapping with the assessment year
(b)
stay in India during

22. An individual is said to be resident in India in any previous year if his total
that year aggregates to at least:
(a) 365 days
(b) 82 days
(c) 282 days
(d) 182 days
23. The amount paid on account of current repairs of machinery, plant and
business is:
(a) Deductible
(b) Not deductible
(c) Part deductible

(d)
furniture being used in a

(a)
24. Profits and gains of business or profession is dealt with under Section:
(a) 15
(b) 18
(c) 28
(d) 22
(c)
25. Which of the following heads of income are no longer operational?
(a) Salaries
(b) Capital gains
(c) Income from other sources
(d) Interest on securities
(d)
on aeroplanes is:

26. With effect from assessment year 2006-07, the rate of depreciation admissible
(a) 20 per cent
(b) 40 per cent
(c) 60 per cent
(d) 10 per cent
27. With effect from assessment year 2006-07, the rate of depreciation admissible
software is:
(a) 60 per cent
(b) 20 per cent
(c) 40 per cent
(d) 30 per cent

(b)
on Computer

(a)
28. Depreciation under section 32 is allowable in respect of:
(a) Tangible assets
(b) Intangible assets
(c) Both a & b
(d) Neither a & b
29. Speculative transactions carried on by an assessee being of a nature to
business shall be considered as a part of the
assessees main business.
(a) Yes

(c)
constitute a Speculation

(b) No
30. Carried forward depreciation is to be treated differently from current
deduction.
(a) Yes
(b) No

(b)
depreciation for allowing

(a)
31. Under Rule 8, an assessee engaged in the business of growing and
manufacturing tea, subject to
other conditions shall be allowed a deduction of
..from the income for deriving the income
liable to tax.
(a) 60 per cent
(b) 40 per cent
(c) 30 per cent
(d) 20 per cent
(a)
32. Deduction by way of Rehabilitation allowance is admissible to an assessee
under section:
(a) 32 AB
(b) 33 B
(c) 35 D
(d) 35 A
(b)
33. Expenditure on Scientific Research is admissible under Section:
(a) 35
(b) 80 IB
(c) Either a or b
(d) None of the above
(a)
34. In respect of a single assessee operating two different businesses, it may be
possible that only
one of the businesses is eligible for deduction under section
80 IA:
(a) Yes
(b) No
(a)
35. Deduction under section 80 IB is admissible in case of a business undertaking
formed by splitting
up or reconstruction of a business already in existence.
(a) Yes
(b) No
(b)
36. Deduction in respect of profits and gains by an undertaking engaged in
development of special
Economic Zone is admissible under Section:
(a) 80 I AB
(b) 10 AA
(c) Both a & b
(d) 10 A
(b)
37. The amount of deduction in the case of an undertaking deriving profits from
the business of
operating and maintaining a hospital in a rural area shall
be.of the profits for 5 initial assessment
years.
(a) 50 per cent
(b) 60 per cent
(c) 100 per cent
(d) 70 per cent
(c)
38. Deduction under Section 80 Q in respect of profits from the business of
publication of books is to
be allowed on the income as reduced by deduction,
if any, admissible under section 80 IB:
(a) Yes
(b) No.
(b)
39. Deduction in respect of tax paid by an assessee in a country with which there is
no DTAA shall be
regulated in terms of Section:
(a) 90 A
(b) 92
(c) 92 A
(d) 91
(d)
40. Which of the following is not a method for computing arms length price?
(a) The resale price method

(b) The cost plus method


(c) The profit split method
(d) The sale price method
(d)
BC shall be

41. The total undisclosed income of the block period determined under Section 158
chargeable at the rate of:
(a) 40 per cent
(b) 30 per cent
(c) 60 per cent
(d) 20 per cent

(c)
gains of a non-

42. If TDS has been deducted from investment income as well as long term Capital
resident Indian who does not have any other income, such
assessee is:
(a) Required to file a return
(b) Not required

(b)
43. The Tonnage Tax Scheme is in respect of Shipping
(a) Voluntary
(b) Mandatory

companies.

44. Under the Power of Survey an Income Tax authority can enter a business
jurisdiction during any time of the day:
(a) Yes
(b) No
45. For making enquiry before assessment in respect of assessees who have
assessing officer can call for information by issuing a
notice under Section:
(a) 139
(b) 142
(c) 142 A
(d) 143
46. In order to carry out a Best judgement assessment in respect of an assessee,
needs to ensure that:
(a) Assessee has failed to comply with terms of a notice under Section 142
(b) Assessee has failed to comply with terms of a notice under Section
(c) Both a & b
(d) Either a or b
47. Under normal circumstances, no action is to be taken by an assessing officer
after the expiry of..from the end of the relevant
assessment year.
(a) 2 years
(b) 4 years
(c) 6 years
(d) 8 years

(a)
premises within its

(a)
furnished returns, an

(b)
the assessing officer
143(2)
(c)
under section 147

(b)
48. A firm shall be assessed as one if:
(a) The partnership is evidence by an instrument
(b) The individual shares of the partners are specified in that instrument
(c) Either a or b
(d) Both a & b
(c)
49. Quoting ones PAN is mandatory in course of correspondence with any Income
(a) Yes
(b) No.

Tax Authority.
(a)

50. TRP stands for:


(a) Tax Refund Procedure
(b) Tax Review Plan
(c) Tax Return Preparer
(d) Total Refund Processed
(c)
51. TIN has been hosted online by:
(a) IT Department
(b) NSDL
(c) NIC

(d) APTECH
(b)

52. With effect from June 1, 2003 filing eTDS returns is mandatory for:
(a) Government deductors
(b) Corporate deductors
(c) All deductors
(b)
53. eTCS return is to be filed in:
(a) Form 24
(b) Form 27
(c) Form 27 A
(d) Form 27 B
(c)
54. TIN Facilitation Centres are meant for:
(a) Issuing PAN Cards
(b) Accepting Tax Payments
(c) Accepting e TDS Returns
(d) Accepting W.T. Returns
(c)
55. For the assessment year 2007-08, return for Fringe benefits is to be filed in:
(a) ITR 2
(b) ITR 4
(c) ITR 6
(d) ITR 8
(d)
56. Sampark-2004 refers to:
(a) A Software prepared by IT Department
(b) A Training programme of the IT Department
(c) An awareness programme of the IT Department
(a)
57. TAN stands for:
(a) Tax Deduction Account Number
(b) Tax Audit Network
(c) Tax Affected Notionally
(a)
58. Paper TDS returns are digitized by NSDL:
(a) Yes
(b) No
(a)
59. Securities Transaction Tax Rules have been framed under:
(a) Finance Act 2003
(b) Finance Act 2004
(c) Finance Act 2005
(d) Finance Act 2006
(b)
60. The following Section has been inserted vide Finance Act 2007:
(a) 139
(b) 139 A
(c) 139 B
(d) 139 C
(d)
61. In Section 40 A(3) of the IT Act as per Finance Act 1995, a sum not exceeding
if
expenditure exceeding Rs.20,000 made otherwise than an
Account payee cheque/DD shall be allowed as
deduction.
(a) 10 per cent
(b) 20 per cent
(c) 80 per cent
(d) 100 per cent
(b)
62. With reference to Q 61 above, the admissible deduction subject to other
conditions has been
amended to.through Finance Act 2007.
(a) Nil
(b) 30 per cent

(c) 40 per cent


(d) 60 per cent
(a)
63. Section QQB was inserted by:
(a) Finance Act 2001
(b) Finance Act 2002
(c) Finance Act 2003
(d) Finance Act 2004
(c)
64. Finance Act 2005 has inserted Section:
(a) 80 A
(b) 80 B
(c) 80 C
(d) 80 D
65. In respect of tax in the case of block assessment of search cases, Finance Act
levy of:
(a) Surcharge
(b) Educational cess
(c) Interest

(c)
2002 has enabled the

(a)
66. Section 206 CA, inserted by Finance Act 2002, deals with:
(a) TAN
(b) PAN
(c) TCAN
(d) None
(c)
of the Income Tax

67. Which of the following application system is a part of the computerisation plan
Department?
(a) AIS
(b) TAS
(c) IRLA
(d) All of the above

(d)

68. AST means:


(a) Assessee Information System
(b) Assessment Information System
(c) Assessment Software Technique
(d) None of the above
(b)
69. Which of the following is true in respect of the Return Receipt Register?
(a) It is generated on line where network is available
(b) It is prepared by using separate software when network is not
(c) Both a & b
(d) None

available
(b)

70. Which of the following is correct in respect of objectives of the computerisation


(a) To provide better services to the taxpayers
(b) To reduce the cost of collection
(c) Both a & b
(d) Only b
71. The National Computer Centre is responsible for maintaining the back up of
RCCs:
(a) Yes
(b) No

plan?

(c)
critical data of all

(a)
72. OLTAS means:
(a) Online Tax Assessment System
(b) Online Tax Accounting System
(c) Online Tabulating and Arranging System
(d) None of the above

(b)
73. The Chief Vigilance Officer of the Income Tax Department is:
(a) The Chief Commissioner of Income Tax
(b) The Director General of Income Tax (Investigation)
(c) The Director General of Income Tax (Vigilance)
(d) None of the above
(c)
74. Challans are posted only after the designated officers confirmation:
(a) Yes
(b) No
(b)
ascertain the

75. With regard to making queries on Challans/refunds the Assessing Officer..


details of encashment of refunds issued by him.
(a) Can
(b) Cannot

(b)

76. An assessing officer can access both AST and TMS Packages using the same
(a) Yes
(b) No

login details.
(a)
allowable in

77. Deduction in respect of Banking Cash Transaction Tax paid by an assessee is


computing the business profits as per Finance Act 2005:
(a) Yes
(b) No

(a)
78. Finance Act 2005 has increased the rate of MAT credit to 10 per cent:
(a) Yes
(b) No
79. The following deduction shall be admissible while determining the income
head Income from house property.
(a) 30 per cent of the annual value
(b) 40 per cent of the annual value
(c) 50 per cent of the annual value
(d) 60 per cent of the annual value

(b)
chargeable under the

(a)
80. Perquisite includes:
(a) Value of rent free accommodation provided to the assessee by the
(b) Value of any benefit provided by a Company free of cost to its
of allotment of shares under employees stock option
plan.
(c) Both a & b
(d) None of the above
81. Under Section 35 CCA of the Income Tax Act, deduction of expenditure by
associations for carrying out rural development
programmes is allowable.
(a) Yes
(b) No

Employer
employees by way

(d)
way of payment to

82. The following expenses may be admissible as deduction, under amortisation


preliminary expenses.
(a) Preparation of feasibility report
(b) Preparation of Project Report
(c) Both a & b
(d) None

(a)
of certain

(c)
83. Amortisation of expenditure incurred under voluntary retirement scheme is
(a) 35
(b) 35 AD
(c) 35 DD
(d) 35 DDA

dealt under Section:

(d)

84. Any sum paid on account of Wealth Tax is deductible while computing the
under the head Profits and gains of business of
profession.
(a) Yes
(b) No

income chargeable

85. Specific definitions and explanations regarding income from profits and gains
profession have been given in Section:
(a) 28
(b) 41
(c) 43
(d) 44

(b)
of business or

(c)
86. Provision for tax is admissible as a deduction under Section 43 B even if the
(a) Yes
(b) No

same is not paid:


(b)
sales, turnover or

87. Audit of accounts of a person carrying on business is compulsory if his total


gross receipts exceed:
(a) Rs.10 lakh
(b) Rs.20 lakh
(c) Rs.30 lakh
(d) Rs.40 lakh
88. Audit of accounts of certain persons carrying on a profession is compulsory in
receipts from the profession exceed:
(a) Rs.10 lakh
(b) Rs.20 lakh
(c) Rs.30 lakh
(d) Rs.40 lakh

(a)
case his gross

(a)
89. In case of firms, for any loss to be carried forward and set off, the same should
through a duly filed return:
(a) Yes
(b) No

be determined

(a)
90. Unexplained expenditure of an assessee is dealt under section:
(a) 69 A
(b) 69 B
(c) 69 C
(d) 69 D
91. Section 54 GA deals with the exemption of capital gains on transfer of assets in
an industrial undertaking to a:
(a) Rural Area
(b) Special Category State
(c) Special Economic Zone
(d) North-Eastern State

(c)
cases of shifting of

(c)
92. Computation of capital gains in case of slump sale is calculated in terms of:
(a) Section 50
(b) Section 50 A
(c) Section 50 B
(d) Section 50 D
93. Subject to other conditions the minimum deemed profit in respect of an
business shall be ..of the turnover.
(a) 2 per cent
(b) 5 per cent
(c) 8 per cent
(d) 10 per cent

(c)
assessee engaged in retail

(b)
94. Income from property held for charitable or religious purposes is dealt under
(a) 10
(b) 11
(c) 12
(d) 13

Section:

(b)
95. Application for registration of a trust is to be made to:
(a) Chief Commissioner
(b) Commissioner
(c) Additional Commissioner
(d) Deputy Commissioner of Income Tax
96. Deduction in respect of certain incomes of offshore Banking Units and
Services Centre is dealt under Section:
(a) 80 IA
(b) 80 IB
(c) 80 IC
(d) 80 LA
97. Income accruing to a resident from whatever source outside India during the
of his total income:
(a) Yes
(b) No

(b)
International Financial

(d)
year shall form part

(a)
98. For the assessment year 2007-08 the basic exemption for women below
(a) Rs.1,00,000
(b) Rs.1,25,000
(c) Rs.1,35,000
(d) Rs.1,85,000

65 years is:

(c)

99. For the assessment year 2007-08, the surcharge for companies and Firms is:
(a) 5 per cent
(b) 10 per cent
(c) 15 per cent
(d) 20 per cent
(b)
100. The Income Tax Act 1961 extends to the whole of India:
(a) Without exception
(b) Except J & K
(c) Except Sikkim
(d) Except Goa
(a)
***