Model Question paper

Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)

Time : 3 Hours Max. Marks: 150

Important Instructions:-
1. The candidate may attempt all questions.
2. Use HB pencil only.
3. Each correct answer shall get 1 mark.
4. Each incorrect answer shall get (-) ¼ mark.
5. If more than one option is filled out, (-) ¼ mark shall be awarded.
6. Please fill out all fields of your answer-script correctly. Kindly recheck your roll no. and
question- paper series before handing over the answer-script to the Invigilator.

Pl note : This model question paper carries only 100 questions. The actual question paper on IT
law & Computation for the ITI Examn. shall carry 150 questions of 1 mark each to be
attempted in 3 hrs.

1. Income-tax for any assessment is charged at the rate(s) prescribed by the –

(a) Income-tax Act 1961.

(b) Central Act i.e the Finance Act.
(c) Finance Bill.
(d) Income-tax (Amendment) Act.

2. As per section 10(10) of the Income-tax Act, for the employees belonging to the civil services
of the Union or a State, any death-cum-retirement gratuity is –

(a) Fully exempt from tax.

(b) Fully taxable.
(c) Partially exempt from tax.
(d) partially or fully exempt depending upon the status of the employee.

3. As per section 10(AA) of the Income-tax Act, for the state Government or Central
Government employees, leave salary is –

(a) Exempt from tax when received at the time of retirement whether on superannuation or otherwise.
(b) Partially exempt from tax.
(c) Fully taxable.
(d) partially or fully exempt depending upon the status of the employee.

4. Employer’s annual contribution to a recognized Provident Fund is deemed to be income

received by employee when contribution made is in excess of -

(a) 10% of salary..

(b) 12% of salary
(c) 8% of salary
(d) The aforesaid contribution is not taxable at all.

5. Under section 10(17) of the Income-tax Act, any income by way of daily allowance received
by any person by reason of his membership of Parliament is –

(a) Exempt fully.

(b) Exempt upto certain specified limit.
(c) Fully taxable.
(d) Exempt subject to fulfillment of certain conditions.

1
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
6. Net taxable income from house property can be negative in the case of
(a) Let out property
(b) Self occupied property
(c) Deemed let out property
(d) All of the above

7. You are given the following figures- (i) Municipal valuation of the house Rs. 1,20,000/- (ii)
Fair rent Rs. 1,40,000/- (iii) Standard rent Rs. 1,30,000/- (iv) Rent received or receivable Rs.
1,25,000/- (v) Municipal Taxes paid Rs. 40,000/-. Annual value would be

(a) 90,000
(b) 80,000
(c) 1,00,000
(d) 85,000

8. Mr X is owner of property which is given on rent for Rs. 2,00,000/- annually. Services for lift,
upkeep, security & air conditioner are also provided by him for which he gets 50,000/- annually.
Choose the correct option-

(a) Rs. 2,50,000 would be treated as Income from house property

(b) Rs. 2,00,000 as Income from house property & 50,000 would be treated as Income from other
sources or business income
(c) Rs. 2,50,000 would be treated as income from business
(d) None of the above

9. Interest payable by assessee on loan taken for acquisition or construction of house property
for the period prior to the previous year in which the property is acquired or constructed, would be -

(a) Allowed in 4 equal instalments commencing from previous year in which the house is constructed
(b) Allowed in 5 equal instalments commencing from previous year in which the house is constructed
(c) Allowed in the previous year in which interest accrued
(d) Allowed in the previous year in which interest actually paid

10. ‘A’ has gross rental income of Rs. 3,00,000 for the previous year from a rented out property.
If the interest paid on loan taken on this property for the said year is Rs. 40,000, the total deduction
available to him u/s 24 of the Income-tax Act from the gross income from the said house property
would be -
(a) 30% of 3,00,000
(b) 30% of 3,00,000 + 40,000
(c) 25% of 3,00,000 + 30,000
(d) 25% of 3,00,000 + 40,000

11. Distribution of assets by a company at the time of liquidation shall not be regarded as a
transfer in the hands of the company as per section 46 of the IT Act. It would, however, be charged
under the head ‘Capital gains’–
(a) In the hands of the company
(b) In the hands of the share-holders receiving any money or other assets on liquidation.
(c) In the hands of both the company and the share-holders.
(d) None of the above.

12. Capital gain in the case of conversion of capital asset into stock in trade would arise.

(a) When such stock-in-trade is sold or transferred.

(b) When the capital asset is converted into stock in trade.
(c) There would be no capital gains in this case.
(d) When such stock-in-trade is re-converted into capital asset.

2
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
13. Exemption under section 54 of the Income-tax Act in respect of profit on sale of property
used for residence is available-

(a) Even of the building is used in the assessee’s business or profession.

(b) Even when the asset is a short-term capital asset.
(c) Even to firms and companies.
(d) None of the above.

14. Profits and Gains are charged as Capital gains in a previous year -

(a) if profits and gains arise from transfer of an asset.

(b) Such asset should be capital asset
(c) Transfer should be effected in the previous year.
(d) All of the above.

15. You are given two situations. (i) capital assets have been distributed on the total partition of a
HUF (ii) capital asset has been transferred under a gift or will. Which of these transactions would not
be regarded a transfer for the purpose of computing capital gains.

(a) Only (i)

(b) Both (i) and (ii)
(c) Only (ii)
(d) Both would be regarded as transfer.

16. Deduction available from family pension amounts to

(a) Rs. 10,000/-

(b) Rs. 15,000/-
(c) 331/3 % of Pension or Rs. 15,000/- whichever is higher
(d) 331/3 % of Pension or Rs. 15,000/- whichever is lower

17. Unrealized rent that is subsequently realized, is included in the income chargeable under the
head ‘Income from house property’–

(a) in the year to which it relates.

(b) even though deduction on account of unrealized rent may not have been allowed in the earlier
years.
(c) in the year in which it is received.
(c) none of the above.

18. Which of the following receipts would be considered as income from other sources under
section 56 of the Income-tax Act-

(a) Rs. 70000 received by an Individual from any relative

(b) Rs 70000 received without consideration by an Individual.
(c) Rs 70000 received by an Individual on the occasion of marriage
(d) All of the above

19. Income chargeable under the head “Income from Other Sources” is taxable

(a) on due basis only

(b) on receipt basis only
(c) on the basis of method regularly adopted by the assessee
(d) None of above

3
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
20. Winning from lotteries, crossword puzzles, horse races, card games etc. are

(a) Fully exempt

(b) Exempt up to 5000/-
(c) Fully taxable
(d) Taxable after allowing deductions

21. The Income tax act extends to

(a) whole of India except the state of Jammu & Kashmir

(b) whole of India
(c) whole of India except the state Of Sikkim
(d) whole of India except the state of Goa,

22. Agricultural Income includes

(a) Rent and revenue derived from land anywhere in the world
(b) rent and revenue derived from land situated in villages in India
(c) income from saplings and seedlings grown in a nursery
(d) any income derived from any building owned and occupied by the agriculturist

23. Block of assets means

(a) group of assets falling within a class of assets comprising moveable and immoveable assets in
respect of which same percentage of depreciation is prescribed.
(b) group of assets falling within a class of assets comprising fixed and current in respect of which
same percentage of depreciation is prescribed.
(c) group of assets falling within a class of assets comprising tangible and intangible assets in respect
of which same percentage of depreciation is prescribed.
(d) group of assets falling within a class of assets comprising liquid and illiquid assets in respect of
which same percentage of depreciation is prescribed

24. As per section 2(24) ,the definition of ‘income ‘ is inclusive and would include anything like

(a) contributions towards provident fund received by the employer from the employee
(b) maturity proceeds of a Keyman insurance policy
(c) illegal income
(d) all the above

25. Income of a body of individual for Assessment year 2009-10 is taxable

(a) @ 10% for income between Rs.1,00,000 to Rs.2,50000, @20% for income between Rs.2,50,000
to Rs.5,00,000 and @30% for income exceeding Rs.5,00,000/-
(b) @ 10% for income between Rs.1,50,000 to Rs.3,00,000, @20% for income between Rs.3,00,000
to Rs.5,00,000 and @30% for income exceeding Rs.5,00,000/
(c) @ 10% for income between Rs.1,00,000 to Rs.2,00,000, @20% for income between Rs.2,00,000
to Rs.5,00,000 and @30% for income exceeding Rs.5,00,000/
(d) @ 10% for income between Rs.1,20,000 to Rs.3,00,000, @20% for income between Rs.3,00,000
to Rs.5,00,000 and @30% for income exceeding Rs.5,00,000/

26. Under Section 10(26AAA) which type of income accruing to a Sikkamese Individual from
any source in the state of Sikkim has been made exempt from Assessment year 1990-91:
(a) Salary
(b) Income From house property
(c) Business
(d) Dividend or interest on securities ( whether generated in Sikkim or any other place)

4
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
27. The finance Act 2008 has extended the benefit of exemptions under section 10A and 10B for
some more time .Now the benefit will be available till

(a) A.Y.2012-13
(b) A.Y.2013-14
(c) A.Y.2011-12
(d) A.Y.2010-11

28. The Finance Act 2008 has inserted a new clause (43) in section 10 to exempt the income of

(a) Coir Board of India

(b) agricultural produce marketing committee
(c) Of an individual who receives any loan under a reverse mortgage scheme referred to in
clause(xvi) of section 47
(d) none of the above

29. What is time limit for filing an application for exemption of income under section 12A?

(a) No time limit is there as the exemption under section 11 &12 would be available only from the
financial year in which the application is made subject to the registration of the trust U/s12A
(b) within one year from the date of the creation
(c) within six months from the date of creation
(d) Before the due date of filing of first return

30. The income of which of the following trust is not eligible for exemption under section
11&12?

(a) Trust created for the benefit of any particular religion/caste

(b) Trust created for the benefit of rural artisans
(c) Trust created for the promotion of a particular trade/industry
(d) Trust created for the benefit of backward classes

31. From A.Y.2009-10, Security Transaction tax is deductible

(a) from the short term capital gain

(b) as rebate under section 88E
(c) as deductible expenditure from income from business
(d) Not at all in any manner

32. A person carrying trading business makes three cash payments exceeding Rs.50,000 in value
to the seller in a single day on 15th May 2009 for purchase of goods. The cash payments

(a) can not be disallowed under section 40A(3) since each of the payment was less than Rs,20,000/-
in view of various courts decisions
(b) can be disallowed under the provisions of section 40A(3) as the provisions of the section have
been changed to tackle such types of manipulations
(c) Can be allowed since it was the first purchase from the seller who did not know the assessee
(d) None of above

33. The last date of obtaining the audit report under section 44AB for A.Y.2008-09 is

(a) 31st July

(b) 31st August
(c) 30th September
(d) 31st October

5
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
34. Which of the following statements is incorrect regarding the admissibility of the claim of
depreciation under section 32?

(a) The asset must be owned by the assessee.

(b) the asset must be a tangible asset.
(c) the asset must be used during the year.
(d) The asset must be used for the purposes of the business

35. A person makes interest payment to a resident in May 2008 without deducting the tax.
However he later on deducts the tax in March 2009 and paid the same to the government account in
May 2009. The amount of interest will be admissible as deduction in

(a) A.Y.2008-09
(b) A.Y.2009-10
(c) A.Y.2010-11
(d) will never be allowed as deduction

36. Chapter VIA of the Income-tax Act relates to deductions to be made in computing total
income. Section 80D of this Chapter relates to -
(a) Deduction in respect of maintenance including medical treatment of a dependant who is person
with disability.
(b) Deduction in respect of deposit made for maintenance of handicapped dependant.
(c) Deduction in respect of medical insurance premia.
(d) Deduction in respect of medical treatment etc.

37. The amount deposited in an account under the Senior deposit scheme under section 80 C can
not be withdrawn before a specified time fixed in by the section. That time limit is

(a) Three years

(b) Four years
(c) five years
(d) six years

38. A sub section (11C) has been inserted in section 80IB with effect from A.Y.2009-10 for
allowing deduction from income for

(a) establishment of schools in rural areas

(b) establishment of hotels in class II cities
(c) establishment of hospitals in non metro cities
(d) construction of roads in remote areas.

39. Finance Act,2008 has amended section 80ID to grant five year tax holiday for construction of
which of the following hotels

(a) Any star hotel in any ancient Indian city

(b) any star hotel in districts having a world heritage site
(c) two, three or four star hotel in districts having a world heritage site
(d) five star hotel in districts having a world heritage site

40. Finance Act,2008 has added a new deduction in clause (xvi) to section 36(1). This clause
allows deduction only when the amount has been paid. The new claim of deduction is on account of

(a) commodities transaction Act,

(b) security Transaction Tax
(c) Toll tax
(d) Service Tax

6
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
41. What has been excluded from the ambit of ‘hospitality expenditure’ in section
115WB(2)(B)with effect from A.Y.2009-10 for the purposes of FBT

(a) A transferable electronic meal card

(b) a non transferable electronic meal card useable at five star hotels
(c) a non transferable electronic meal card useable at eating joints or outlets
(d) a non transferable electronic meal card useable at office pantry

42. What has been excluded by the finance Act, 2008 w.e.f.A.Y.2009-10 from the purview of
‘employees welfare ‘ as defined in Section 115WB(2)E for the purposes of FBT?

(a) crèche facility for the children of the employee

(b) sponsoring a sports person who is an employee
(c) organizing of sports events for employees
(d) all the above

43. The value of Fringe benefits on account of festival celebration has been reduced
w.e.f.A.Y.2009-10 to

(a) 50%
(b) 40%
(c) 30%
(d) 20%

44. Who is not an employer as per section 115W of Income tax act

(a) A company
(b) An association of person
(c) a local authority
(d) a political party

45. Which of the following contributions of the employer are fringe benefits within the meaning
of section115WB?

(a) Contributions to Approved provident fund

(b) Contributions to approved gratuity funds
(c) Contributions to approved superannuation fund
(d) Contributions to approved retrenchment fund

46. Which of the following persons is not chargeable to wealth tax?

(a) An individual
(b) A HUf
(c) A company
(d) A company registered u/s 25 of the Companies Act, 1956

47. Which of the following houses is treated as an asset within the meaning of section 2(ea)(1) of
the Wealth Tax` Act

(a) a guest house meant exclusively for the residence of an employee or whole time director whose
gross annual salary is less than Rs.5 lakh
(b) A house held as stock in trade.
(c) A house used for own business or profession
(d) a farm house situated within 25km from the local limits of any municipality

7
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
48. Under section 4(1)(a)(v) ,an asset transferred to son’s wife is a deemed asset provided certain
conditions are satisfied. Which of the following is not a condition for the above purpose:

(a) The transfer may be direct or indirect

(b) The asset is not transferred for adequate consideration
(c) The asset must be held by the transferee on the relevant valuation date in the same form.
(d) The asset must have been transferred by an individual after May 31, 1973

49. Net wealth for the purpose of Wealth tax Act means

(a) All Assets plus deemed assets less Debt owed

(b) All Assets less (exempted assets plus debt owed)
(c) All Assets plus deemed assets less (exempted assets plus Debt owed)
(d) All assets less debt owed

50. The due date of filing of wealth tax return is

(a) 31st August

(b) 30th June
(c) 31st October
(d) The due date specified under section 139 of Income tax Act

51. Where there is any loss under the head ‘Capital gains’, whether short-term or long-term -

(a) it can be set-off against income chargeable under any other head.
(b) it can not be set-off against income chargeable under any other head.
(c) It can be set off only against Income under the head ‘Profits and gains of business or profession’.
(d) It can not be carried forward.

52. As per section 78 of the Income-tax Act, where a change has occurred in the constitution of a
firm, -

(a) the loss allowed to be carried forward and set-off shall be nil.
(b) so much of the loss proportionate to the share of a retired or a deceased partner as exceeds his
share of profit in the firm shall not be carried forward.
(c) so much of the loss proportionate to the share of a retired or a deceased partner as exceeds his
share of profit in the firm shall be carried forward.
(d) there would be no effect on the losses allowed to be carried forward and set-off.

53. Loss from a source of income that is totally exempt from tax-

(a) is allowed to be carried forward.

(b) Can be set-off against taxable income.
(c) Can not be set-off against taxable income.
(d) Can be set-off against taxable income under the head ‘other sources’.

54. Inter-head adjustment when the net income computed under a head is a loss-

(a) is possible before inter-source adjustment has been made to the maximum possible extent.
(b) is possible after inter-source adjustment has been made to some extent.
(c) is possible only after inter-source adjustment has been made to the maximum possible extent.
(d) None of the above.

8
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
55. Deductions under Chapter VIA are given -

(a) on separate incomes under respective heads.

(b) On aggregate income from all the heads after making the necessary inter-head adjustments.
(c) On aggregate income from all the heads before making the necessary inter-head adjustments.
(d) Not given from the aggregate income.

56. The scheme of inter-source and inter-head adjustment is-

(a) Mandatory.
(b) Optional at the option of assessee.
(c) Optional at the option of AO.
(d) Not applicable in respect of head ‘Income from house property’.

57. Conditions for business loss to be carried forward and set-off are-

(a) Net result under the head ‘profits and gains of business or profession’ is a loss.
(b) Such loss is not from speculation business.
(c) Such loss can not be wholly set-off u/s 71 against income from any other head.
(d) All of the above.

58. If there is loss in respect of speculation business, carried on by the assessee-

(a) such loss can not be set-off against the profits and gains of another speculation business.
(b) Submission of return of losses is not essential in order to claim set-off of loss.
(c) Both a and b are correct.
(d) None of the above.

59. From the assessment year 2003-04, long-term capital loss -

(a) Can not be set off against long-term capital gain.
(b) Can be set off only against long-term capital gain.
(c) Can be set-off against short-term capital gain.
(d) Can not be set-off at all.

60. Business loss can be carried forward and set-off -

(a) against a business income only of the same business.
(b) against a business income only of any business.
(c) against a business income or income under any other head.
(d) Not against a business income.

61. If an assessee incurs loss in a speculation business which is carried forward, than to claim set-
off of such loss, than the same speculation business -

(a) should be carried on in the assessment year in which the set-off is claimed.
(b) should not be carried on in the assessment year in which the set-off is claimed.
(c) Is not necessary to be carried on in the assessment year in which the set-off is claimed.
(d) None of the above.

62. Loss from the activity of owning and maintaining race horses -

(a) can be carried forward upto 4 assessment years including the assessment year in which it was first
computed.
(b) can be carried forward upto 8 assessment years immediately succeeding the assessment year in
which it was first computed.
(c) can not be carried forward.
(d) can be carried forward upto 4 assessment years immediately succeeding the assessment year in
which it was first computed.

9
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
63. The CBDT -

(a) is not an Income-tax authority under the Income-tax Act.

(b) is an Income-tax authority under the Income-tax Act subject to certain conditions.
(c) Is an Income-tax Authority only for certain specified provisions.
(d) is an Income-tax authority under the Income-tax Act.

64. The CBDT have the powers under section 119-

(a) to issue orders to require any income-tax authority to make a particular assessment in a particular
manner.
(b) To interfere with the discretion of CIT(Appeals) in the exercise of his appellate functions.
(c) Both a and b are correct.
(d) None of the above.

65. Any income-tax authority, being a authority higher in rank-

(a) may exercise the powers and functions of the authority lower in rank at their option.
(b) Can not exercise the powers and functions of the authority lower in rank.
(c) may exercise the powers and functions of the authority lower in rank if so directed by the CBDT.
(d) None of the above.

66. In assigning the jurisdiction to an income-tax authority, the CBDT may have regard to -

(a) only territorial area.

(b) Only persons or classes of persons.
(c) Only incomes or classes of incomes.
(d) All of the above.

67. A person who has made a return under section 139(1) can not call in question the jurisdiction
of an Assessing officer-

(a) after expiry of one month from the date of service of notice u/s 142(1) or 143(2) or the completion
of assessment whichever is earlier.
(b) after expiry of one year from the date of service of notice u/s 142(1) or 143(2) or the completion
of assessment whichever is earlier.
(c) after expiry of six months from the date of service of notice u/s 142(1) or 143(2) or the
completion of assessment whichever is earlier.
(d) After expiry of two months from the date of service of notice u/s 142(1) or 143(2) or the
completion of assessment whichever is earlier.

68. For transferring cases from jurisdiction of one subordinate assessing Officer to any other
subordinate Assessing Officer, the DGIT/CCIT/CIT -

(a) is not required to record reasons for doing so.

(b) is required to record reasons for doing so.
(c) May record reasons at his option.
(d) None of the above.

69. For retaining custody of impounded books of account u/s 131(3), the AO/ADIT/DDIT should
take permission of the CCIT/DGIT/CIT/DIT -

(a) if period of custody exceeds 2 weeks.

(b) if period of custody exceeds 10 days.
(c) if period of custody exceeds 15 days.
(d) No permission is required to be taken.

10
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
70. The search and seizure provisions u/s 132 confer -
(a) Arbitrary authority.
(b) Unfettered powers.
(c) Powers which are to be exercised strictly in accordance with the law.
(d) All of the above.

71. Where any books of account, other documents etc. are found in possession or control of any
person in the course of a search,
(a) The presumption is such books of account etc. belong to such person.
(b) The presumption is that the contents of such books of account are correct.
(c) Both a and b are correct.
(d) Both a and b are wrong.

72. If the authorized Officer has no jurisdiction over the person in whose case a search action has
been taken, he should hand over the seized documents to the AO having jurisdiction within a period
of -
(a) 60 days from the date of last authorization.
(b) 60 days from the date of first authorization.
(c) 120 days from the date of last authorization.
(d) 120 days from the date of first authorization.

73. Following could be sources of information for preparation of search-

(a) TEPs and Dossiers

(b) Records of BCTT and STT.
(c) Information contained in AIR returns and other information collected by CIB.
(d) All of the above.

74. To assist him in exercising powers u/s 132(1), the authorized officer may requisition the
services of -

(a) any police officer or any officer of the Central Government.

(b) any police officer or any officer of the Central or State Government.
(c) any officer of the Central or State Government.
(d) Any Officer of the Central or State Government or of any nationalized bank.

75. Serving of order u/s 132(3) is -

(a) Deemed Seizure.

(b) Not considered as deemed seizure.
(c) Is considered as deemed seizure.
(d) Is considered as deemed seizure subject to certain conditions.

76. If an employer has paid non-monetary perquisites in the nature of salary to an employee-

(a) the employer has to pay tax on such income.

(b) The employer can not pay tax on such income.
(c) the employer at his option can pay tax on such income without deduction of tax from such
income.
(d) The employer can not pay tax on such income unless the employee authorizes him to do so.

77. Deduction of tax on income by way of securities is made at-

(a) the time of credit of such income to the account of the payee.
(b) The time of payment thereof in cash/cheque/draft or any other mode.
(c) a or b whichever is later.
(d) a or b whichever is earlier.

11
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
78. In respect of Interest other than ‘Interest on Securities’ the monetary limit below which no
deduction of tax is required to be made is

(a) Rs. 10000 in case of banking company and Rs. 5000 in case of co-operative banks.
(b) Rs 10000 in case of banking company/co-operative bank/notified post office scheme and Rs. 5000
in any other case.
(c) Rs 5000 in case of banking company/co-operative bank/notified post office scheme and Rs. 10000
in any other case.
(d) Flat limit of Rs. 10000.

79. In respect of winnings from lottery or crossword puzzle-

(a) there is no provision for deduction of tax at a lower rate.

(b) there is provision for deduction of tax at a lower rate.
(c) there is provision for deduction of tax at a lower rate if the amount is higher than Rs. 5000.
(d) No deduction is required to be made.

80. The seller, under section 206C, is required to collect tax on the following nature of goods-

(a) Alcoholic Liquor for human consumption.

(b) Tendu
(c) leaves.
(d) Both (a) and (b)
(e) None of the above.

81. Advance tax is payable in respect of -

(a) All chargeable incomes except incomes on which tax is leviable at special rate.
(b) Gross Total Income.
(c) Total Taxable Income.
(d) 90% of Total Taxable Income.

82. Due dates of installment for payment of advance tax in respect of a company are-

(a) 15th June, 15th September, 15th December, 15th March.

(b) 15th September, 15th December, 15th March.
(c) 15th June, 15th September, 15th December, 31st March.
(d) 15th September, 15th December, 31st March.

83. For defaults in payment of advance tax -

(a) interest u/s 234C is chargeable.

(b) interest u/s 234B is chargeable.
(c) interest u/s 234A is chargeable.
(d) No interest is chargeable from the assessee.

84. The interest u/s 220(2) and penalty u/s 221 are

(a) mutually exclusive.

(b) Can exceed the amount of tax in arrears.
(c) Can not exceed the amount of tax in arrears.
(d) Not mutually exclusive.

85. Section 234D relates to -

(a) Interest payable by assessee in case of under estimate.
(b) Interest payable by assessee when no estimate made.
(c) Interest on excess refund.
(d) None of the above.

12
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
86. Penalty under section 271(1)(d) is leviable if any person

(a) has concealed the particulars of his income or furnished inaccurate particulars of such income.
(b) has concealed the particulars of the fringe benefits or furnished inaccurate particulars of such
fringe benefits
(c) both a and b above
(d) None of the above

87. Penalties under section 271(1) can be imposed by

(a) The Assessing Officer only.

(b) The Assessing Officer or the Commissioner (Appeals) only
(c) The Assessing Officer or the Commissioner (Appeals) or the Commissioner
(d) the Commissioner (Appeals) or the Commissioner only.

88. Where a search has been initiated u/s 132 on or after 1.6.2007, the AO can impose a penalty
under section 271AAA.

(a) This penalty shall be in addition to the penalty u/s 271(1)(c)

(b) This penalty shall be ten percent of the undisclosed income of the specified previous year.
(c) Both a and b above.
(d) None of the above.

89. Under section 274, the monetary limits for imposition of penalties are-

(a) Rs. 10000 for ITO and Rs. 25000 for ACIT/DCIT
(b) Rs 20000 for ITO/ACIT/DCIT
(c) Rs. 10000 for ITO and Rs. 20000 for ACIT/DCIT
(d) Rs. 10000 for ITO/ACIT/DCIT

90. Any reference to income in section 271 relating to penalty for failure to furnish returns,
comply with notices etc. is -

(a) also a reference to fringe benefits.

(b) Is not a reference to fringe benefits.
(c) Is a reference to fringe benefits only in relation to 271(1)(c).
(d) Is a reference to fringe benefits for assessment purposes only not for penalty purposes.

91. In a case where the assessee has failed to deduct tax at source -

(a) Penalty under section 271(1) can be initiated.

(b) Penalty under section 271(1) is leviable provided the amount of amount of tax is in excess of Rs.
5000.
(c) Penalty under section 271(1) is leviable subject to certain conditions.
(d) Penalty under section 271(1) is not leviable.

92. For failure to furnish return of income under section 139(1), the penalty u/s 271F can be
levied if

(a) the return has not been furnished by the due date.
(b) the return has not been furnished by the end of the relevant assessment year.
(c) the return has not been furnished by the end of one year from the end of the relevant assessment
year.
(d) the return has not been furnished by the end of date to be notified yearly by the CBDT.

13
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
93. Under section 273A, relating to power to reduce or waive penalty, the order by the
Commissioner

(a) can be passed within one year from the end of the year when the penalty was levied.
(b) can be passed after approval from the CBDT.
(c) Can be passed within two years from the end of the year when the penalty was levied.
(d) Can be passed without any limit on time.

94. There are certain penalties prescribed in Chapter XXI which can be levied-

(a) without giving the assessee a reasonable opportunity of being heard.

(b) Without giving the assessee a reasonable opportunity of being heard, at the option of the JCIT.
(c) There are no such penalties.
(d) None of the above.

95. The maximum amount on which income tax is not chargeable for assessment year 2009-10 in
the case of a man/ women who is of the age of 65 years or above and is not resident of India.

(a) Rs. 1,80,000

(b) Rs. 2,25,000
(c) Rs. 1,50,000
(d) Rs. 1,10,000
(e)

96. ‘Assets’ in the Wealth Tax Act include

(a) Non-commercial Yatch, boats and aircrafts

(b) Non-commercial Yatch and commercial aircrafts
(c) Commercial Aircrafts but Non-commercial Yatch
(d) All Commercial Yatch, boats and aircrafts

97. In respect of ‘urban land’ under wealth tax Act, the specification of distance and population in
respect of cantonment board is

(a) 8 Km and 100,000

(b) 18 Km and 20,000
(c) 8 Km and 10,000
(d) 80 Km and 10,000

98. The present rate and exemption limit in respect of taxation of wealth under the Wealth Tax
Act 1957 is

(a) 1% and Rs. 25,00,000

(b) 1% and Rs. 15,00,000
(c) 2% and Rs. 15,00,000
(d) 2% and Rs. 25,00,000

99. Wealth Tax is payable

(a) In respect of property held for any public purpose of a charitable or religious nature
(b) In respect of property held for any public purpose of a charitable nature but not religious
(c) In respect of property held for any public purpose of religious nature but not charitable
(d) None of the above

14
 Model Question paper
Paper-I-ITI Examn.2009-Income Tax Law & Computation (Without books)(Objective type)
100. If an individual transfers to his spouse, assets belonging to him, directly or indirectly, other
wise than for adequate consideration,

(a) The value of such assets as on valuation date shall be included in computing the net wealth
(b) The cost of such assets as on valuation date shall be included in computing the net wealth
(c) The value of such assets as on transfer date shall be included in computing the net wealth
(d) Such assets shall not be considered for computation of his net wealth

Suggested answers to the above questions.

1 b 21 b 41 c 61 c 81 c
2 a 22 c 42 d 62 d 82 a
3 a 23 c 43 d 63 d 83 b
4 b 24 d 44 d 64 d 84 d
5 a 25 b 45 c 65 c 85 c
6 d 26 d 46 d 66 d 86 b
7 a 27 d 47 d 67 a 87 c
8 b 28 c 48 c 68 b 88 b
9 b 29 a 49 c 69 c 89 c
10 b 30 a 50 d 70 c 90 a
11 b 31 c 51 b 71 c 91 d
12 a 32 b 52 b 72 a 92 b
13 d 33 c 53 c 73 d 93 d
14 d 34 b 54 c 74 a 94 c
15 b 35 c 55 b 75 b 95 c
16 d 36 c 56 a 76 c 96 a
17 c 37 c 57 d 77 d 97 c
18 b 38 c 58 d 78 b 98 b
19 c 39 c 59 b 79 a 99 d
20 c 40 a 60 b 80 c 100 a

***************

15