Taxation

TAXATION
LIST OF ATTEMPTED QUESTIONS AND ANSWERS
Select The Blank

Question 1 Mr X a salaried employee has received total educational allowance of Rs 8,000
for his four children, the maximum allowance exempt is ________ u/s 10(14) of
the IT Act.
Correct Answer Rs 2,400
Your Answer Rs 2,400
Multiple Choice Multiple Answer

Question2 What is the tax treatment of the Lump sum received from unrecognized
provident fund on the retirement or resignation or death of the employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest on employee's
contribution is taxable as "Income from Other Sources" , Employer's
Contribution to PF and interest thereon is taxable as "Income from salaries"
Your Answer Interest on employee's contribution is taxable as "Income from Other Sources" ,
Employer's Contribution to PF and interest thereon is taxable as "Income from
salaries" , Employee's contribution to PF is exempt from tax
True/False
Question 3 Software technology park means set up according to Software Technology Park
Scheme framed by Ministry of Commerce & Industries.
Correct Answer True
Your Answer True
Select The Blank

Question 4 It is mandatory for ________ to file a return even if there is loss or the income is
nil.
Correct Answer A company
Your Answer Persons under "One by Six" scheme

Question 5 Following professional institutions have their incomes exempt from tax :-
Correct Answer Town planning , Company secretary , Accounting
Your Answer Town planning , Company secretary , Accounting

Question 6 Which of the following amounts credited to P & L Account but not taxable from
Income tax Purposes as Profits from Business and Profession?
Correct Answer Refund of Income tax , Capital Gains , Dividend Income
Your Answer Refund of Income tax , Capital Gains , Dividend Income
Select The Blank

TAXATION
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Question 7 ________ is the tax payable on the manufacturing of goods.
Correct Answer Excise duty
Your Answer Excise duty
Select The Blank

Question 8 The amount paid by the employer to the employee to meet the expenditure for
residential accommodation occupied by the employee is called ________.
Correct Answer House rent allowance
Your Answer House rent allowance

Question 9 Any amount deposited by an Individual or a HUF in 10 year or 15 year account
under the Post Office Saving Bank (CTD) Rules, 1959. The account can be in
the name of :-
Correct Answer The individual himself , A minor of whom he is the guardian.
Your Answer The individual himself , A minor of whom he is the guardian.
Select The Blank

Question 10 Section 80U allows the deduction in respect of the ________ .
Correct Answer Permanent physical disability
Your Answer Permanent physical disability
Multiple Choice Single Answer

Question 11 Income of notified news agencies is exempt provided :-
Correct Answer They apply their income for collection & distribution of news
Your Answer They apply their income for collection & distribution of news

Question 12 The total amount of rebates under Section 88, Section 88B, Section 88C and
Section 88D of the Act. shall :-
Correct Answer Not exceed the amount of tax calculated on the total income.
Your Answer Not exceed the amount of tax calculated on the total income.

Question 13 What is the treatment of Uncommuted Pension?
Correct Answer It is taxable as Income from Salaries.
Your Answer It is taxable as Income from Salaries.

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Question 14 Perquisites which are taxable only in the hands of specified employee include
the following categories of perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal attendant ,
Gas, electricity and water provided for personal consumption
Your Answer Motor Car , Services of sweeper, gardener, watchman or personal attendant ,

Question 15 The Central Government has introduced a new pension scheme for the
employees employed on or after 15th January, 2004. These employees are
required to contribute 10% of their salaries to this pension scheme. How much
will the Central Government contribute to the Fund?
Correct Answer Equal amount
Your Answer Equal amount
True/False
Question 16 In case of deductions for medical treatment under Section 80DDB the amount of
deduction will be reduced by the amount received under an insurance policy or
the amount reimbursed by the employer.
Correct Answer True
Your Answer True

Question 17 If any person fails to get the accounts audited by a Chartered Accountant and
fails to submit the copy of such report under section 44AB, he will be liable to
pay the penalty equal to :-
Correct Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is less
Your Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is less
Select The Blank

Question 18 Section 35E of the Act applies to all the ________ engaged in the business of
prospecting for or extraction or production of certain specified minerals.
Correct Answer Resident assessees
Your Answer Non-ordinary resident assessees

Question 19 Profits earned by an Industrial Undertaking engaged in other than infrastructure
development is available under Section 80IB for :-
Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or place of pilgrimage
, Company engaged in scientific and industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural area or place of pilgrimage
True/False
Question 20 Jewellery held by the assessee is not a Capital Asset.
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Correct Answer False
Your Answer False
Select The Blank

Question 21 House rent allowance is exempt from the heading ________.
Correct Answer Income from salaries
Your Answer Income from salaries

Question 22 The various payments which are referred as deductions under section 43B,
Clause No-21 are :-
Correct Answer Any employees contribution payable by the assessee towards any Provident
Fund or Superannuation Fund or Gratuity Fund for the welfare of the employees
, Any sum payable by the assessee by way of tax duty, cess or fee , Any sum
payable by the assessee as interest on any loan or borrowing made by him from
any public financial institution or state financial corporation as per the terms of
the agreement
Your Answer Any employees contribution payable by the assessee towards any Provident
Fund or Superannuation Fund or Gratuity Fund for the welfare of the employees
, Any sum payable by the assessee by way of tax duty, cess or fee , Any sum
payable by the assessee as interest on any loan or borrowing made by him from
any public financial institution or state financial corporation as per the terms of
the agreement
Select The Blank

Question 23 The rebate u/s ________ is available to a woman assessee below the age of 65
years at any time during the previous years.
Correct Answer 88C
Your Answer 88B
True/False
Question 24 An deduction is allowed to an assesse as an employer in respect of contribution
made to any non-statutory fund under the section 40A(9).
Your Answer True
True/False
Question 25 Dividend received by the shareholder is treated as income chargeable to tax u/s
10(34) of the IT Act.
Your Answer False

Question 26 The assessee is required to quote PAN in :-
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Correct Answer All returns to or correspondence with the Income Tax Authorities , All the
challans for the payment of any amount under the Act , All the documents
pertaining to purchase, sale and bank transactions
Your Answer All returns to or correspondence with the Income Tax Authorities , All the
challans for the payment of any amount under the Act , All the documents
pertaining to purchase, sale and bank transactions

Question 27 Any person carrying on business or profession has to submit the Audit Report in
prescribed form, signed by Chartered Accountant before 31st October of the
assessment year, whether the return of income is filed or not. This is in
compliance with :-
Correct Answer Section 44AB of the Act
Your Answer Section 44AB of the Act

Question 28 In case of the individual or HUF whose Gross Total Income, before deductions
under Chapter VI-A, is more than Rs. 5,00,000, then :-
Correct Answer No rebate will be available u/s 88.
Your Answer Rebate will be available u/s 88

Question 29 If firm fails to submit copy of deed along with return of income :-
Correct Answer It will not constitute a separate taxable entity
Your Answer It will not constitute a separate taxable entity

Question 30 In order to avoid the cases of tax evasion on the part of the assessees, the Act
has provided for :-
Correct Answer Tax deduction at source
Your Answer Tax deduction at source

Question 31 Which of the following expenditures are expressly disallowed to be deducted
while computing the profits from business and profession
Correct Answer Income Tax , Wealth Tax
Your Answer Income Tax , Wealth Tax
True/False
Question 32 Section 80QQB is applicable to the individual resident who is an author of text
books.
Your Answer False

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Select The Blank

Question 33 Section 35AC of the Act applies to any sum paid by the assessee to a public
sector company or a local authority or an association approved by the national
committee for ________ for carrying out any project in upliftment of public.
Correct Answer Promotion of social and economic welfare
Your Answer Promotion of social and economic welfare

Question 34 Income from sub-letting of a house property is income from :-
Correct Answer Other sources
Your Answer Subletting

Question 35 Income of a professional association is exempt if its objectives are :-
Correct Answer Supervision , Control , Encouragement
Your Answer Supervision , Control , Encouragement

Question 36 Choose capital expenditure from the following list :-
Correct Answer Purchase of Building , Purchase of machinery
Your Answer Purchase of Building , Construction of temporary structures , Purchase of

machinery
True/False
Question 37 Loss under the head Profits from Business or Profession can be adjusted
against the Income from Salaries.
Your Answer False
Select The Blank

Question 38 Deduction u/s 10A is ________ of export proportion of profits.
Correct Answer 0.9
Your Answer 0.9
True/False
Question 39 Rebates as per the provisions of Section 88C of the Act are not available from
the tax on long-term capital gains.
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Your Answer False
True/False
Question 40 Dividend received from domestic company to its shareholders is taxable in the
hands of the shareholder.
Your Answer True
Match The Following

Question 41 Correct Answer Your Answer
Super Annuation Fund This is an employee welfare This is an employee welfare

scheme which is usually scheme which is usually
applicable in case of very applicable in case of very senior
senior employees employees
Statutory Provident Fund This is set up as per the This is set up as per the
provisions of Provident Fund provisions of Provident Fund
Act, 1925. This is maintained Act, 1925. This is maintained by
by Government organizations, Government organizations, local
local authorities, universities authorities, universities and
and educational institutions. educational institutions.
Recognised Provident Fund This is the provident fund to This is the provident fund to
which the provisions of which the provisions of
Employees Provident Fund and Employees Provident Fund and
Miscellaneous Provisions Act, Miscellaneous Provisions Act,
1952 apply. 1952 apply.
Unrecognised Provident Fund The provident fund which is not The provident fund which is not
recognized by the income tax recognized by the income tax
authorities is called as authorities is called as
unrecognized provident fund. unrecognized provident fund.

Question 42 Tax liability of a person is based on :-
Correct Answer Residential status
Your Answer Residential status
Select The Blank

Question 43 The amount of compensation received or receivable by the employee from the
employer at the time of termination of his employment or at the time of
modification of terms and conditions in connection with the employment is called
as ________.
Correct Answer Terminal compensation.
Your Answer Terminal compensation.
Match The Following

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Intangible Capital Asset Tenancy Rights Tenancy Rights
Excluded from ambit of term Stock in Trade Land held for a period of 36
Capital Asset months or more
Short Term Capital Asset Equity Shares held for a period Stock in Trade
of Less than 36 months
Long Term Capital Asset Land held for a period of 36 Building
months or more

Question 45 The entertainment allowance received by the Government employees is
included in their salaries and the deduction is allowed to the extent of least of
the following amounts :-
Correct Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment Allowance
received.
Your Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment Allowance
received.
True/False
Question 46 Annual premium paid by the employer for the accident insurance policy taken by
the employer in the name of the employee is chargeable to tax.
Your Answer False

Question 47 Following condition needs to be satisfied for claiming the exemption under
Section 54F :-
Correct Answer The assessee is an individual or a HUF
Your Answer The assesse is Firm

Question 48 Deduction in respect of Contribution to certain pension funds is related to :-
Correct Answer Section 80CCC
Your Answer Section 80CCC
True/False
Question 49 The rebate u/s 88B is allowed before the rebate u/s 88 is allowed.
Correct Answer True

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Your Answer False
Select The Blank

Question 50 Expenditure incurred in connection with the local festivals like Diwali etc. are
________ as business expenditure.
Correct Answer Allowed
Your Answer Allowed
Select The Blank

Question 51 Deduction is available for income from foreign sources under Section 80RR if
such remuneration brought into India in convertible foreign exchange within a
period of________ months from the end of the previous year.
Correct Answer 6
Your Answer 6

Question 52 Short Term Capital Loss can be adjusted against :-
Correct Answer Short Term Capital Gains. , Long term Capital Gains
Your Answer Short Term Capital Gains. , Long term Capital Gains

Question 53 Income from winning from lotteries / crossword puzzles/ horse races is taxed at
flat rate of :-
Correct Answer 0.3
Your Answer 0.35
Select The Blank

Question 54 Section 35D of the Act provides that the preliminary expenses can be ________
over a period of 5 years commencing from the year of commencement of
business.
Correct Answer Amortized and written off to profit and loss account
Your Answer Amortized and written off to profit and loss account
Select The Blank

Question 55 Section 43B of the IT Act provides that the certain payments are allowed as
deduction only if they are ________.
Correct Answer Actually paid
Your Answer Reasonable

Question 56 The rebate u/s 88 is available to an :-
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Correct Answer Individual , Hindu Undivided Family.
Your Answer Individual , Hindu Undivided Family.

Question 57 Income from other sources covers agricultural income from land situated :-
Correct Answer Outside India
Your Answer Outside India

Question 58 A return is considered to be defective returns under section 139(9) unless :-
Correct Answer The computation of income under each head, Gross Total Income are properly
filed in , The return is accompanied by the tax audit report under section 44AB ,
The return is accompanied by copies of required financial statements of the
assessee
Your Answer The computation of income under each head, Gross Total Income are properly
filed in , The return is accompanied by the tax audit report under section 44AB ,
The return is accompanied by copies of required financial statements of the
assessee

Question 59 If an employee does not avail of this leave travel concession or assistance
during a block of four calendar years :-
Correct Answer Only one journey can be carried forward to the next block.
Your Answer Only one journey can be carried forward to the next block.
Select The Blank

Question 60 The person who does not deduct the tax source as required by the Act or after
deducting fails to pay the tax as required by the Act, shall be liable to pay the
simple interest @________ % per month on the amount of such tax from the
date on which the tax was deductible till the date on which such tax is actually
paid.
Correct Answer 1
Your Answer 1.25

Question 61 The assessing officer may allot the Permanent Account Number(PAN) to :-
Correct Answer Person whose Total Income during previous year exceeds the maximum
amount, chargeable to tax , Person carrying on the business or profession
whose turnover exceeds Rs.5 lakhs in any previous year , Any other person by
whom tax is payable
Your Answer Person carrying on the business or profession whose turnover exceeds Rs.5
lakhs in any previous year , Any other person by whom tax is payable , Any
person not applying for permanent account number but, tax is payable by him
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Question 62 The provisions for payment of gratuity is not allowed under section 40A(7) but,
under the head, profits from business and profession, the amount of gratuity will
be allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable to the employees during
the previous year , The provision has been made for the payment of a sum by
way of contribution to an approval gratuity , The other than the above two
situations, any provision made for the payment of gratuity is not allowed as
deduction
Your Answer The amount of gratuity has actually become payable to the employees during
the previous year , The provision has been made for the payment of a sum by
way of contribution to an approval gratuity , The other than the above two
situations, any provision made for the payment of gratuity is not allowed as
deduction

Question 63 For the purpose of taxability of perquisite a specified employee means :-
Correct Answer The person who is director of a company , The employee who has substantial
interest in the company by having 20% or more of the voting power , The
employee whose income under the head salaries (including all the taxable
monetary payments of salary but excluding the value of any non-monetary
benefits or perquisites), after allowing deductions under Section 16, exceeds
Rs. 50,000
Your Answer The person who is director of a company , The employee who has substantial
interest in the company by having 20% or more of the voting power , The
employee whose income under the head salaries (including all the taxable
monetary payments of salary but excluding the value of any non-monetary
benefits or perquisites), after allowing deductions under Section 16, exceeds
Rs. 50,000
True/False
Question 64 Sum received under a will / inheritance is not exempt.
Correct Answer True
Your Answer False
Select The Blank

Question 65 It should be noted that the tax liability of an individual having the total income of
less than Rs ________ is Nil u/s 88D.
Correct Answer 1,00,000
Your Answer 1,00,000
Match The Following

All intangible assets like Rate of depreciation is 25% Rate of depreciation is 25%
Patents, Trademarks, Copy
Rights, Licenses etc.
Temporary Structures Rate of depreciation is 100% Rate of depreciation is 10%
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Computers Rate of depreciation is 60% Rate of depreciation is 40%
Containers made of glass or Rate of depreciation is 40% Rate of depreciation is 60%

plastic used as refills
Select The Blank

Question 67 In case of foreign companies rate of tax is ________.
Correct Answer 0.35
Your Answer 0.35

Question 68 Which of the following expenditure is in the nature of revenue expenditure?
Correct Answer Expenditure incurred as discount on issue of debentures
Your Answer Expenditure incurred as discount on issue of debentures

Question 69 For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term
"Specified Persons" may include :-
Correct Answer Any partner of the firm or his relative , Any person having the substantial interest
in the business or profession of the firm or any director or partner of such
company or firm or any relative of such person. , Any person who carries on
business or profession and in his business or profession the assessee or any
partner of such firm or relative of such partner has substantial interest.
Your Answer Any partner of the firm or his relative , Any person having the substantial interest
in the business or profession of the firm or any director or partner of such
company or firm or any relative of such person. , Any person who carries on
business or profession and in his business or profession the assessee or any
partner of such firm or relative of such partner has substantial interest.

Question 70 For charging the income in the form of salaries :-
Correct Answer There needs to be an employer-employee relationship between the payer and
the payee.
Your Answer There needs to be an employer-employee relationship between the payer and
the payee.
True/False
Question 71 For claiming the deduction under section 80IA, the industrial undertaking should
be owned by a company registered in India or a consortium of such companies.
Correct Answer True
Your Answer True
Select The Blank

Question 72 Any expenditure incurred by the assessee for any purpose which is ________
or which is prohibited by law shall not be allowed as business expenditure
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Correct Answer Offence
Your Answer Offence

Question 73 As a general principle, the Basic Salary or Wages, Dearness Allowance and
Bonus / Commission is :-
Correct Answer Fully taxable.
Your Answer Fully taxable.
True/False
Question 74 Rebates as per the provisions of Section 88 of the Act are not available from the
tax on long-term capital gains.
Correct Answer True
Your Answer True
True/False
Question 75 MAT is applicable if there is a difference of 7.5% between net profit & book
profit.
Correct Answer True
Your Answer False

Question 76 For the purpose of Section 40 A (2) of the IT Act, if assessee is an individual,
the term "Specified Persons" may include :-
Correct Answer Any relative of such individual , Any person (individual, company, firm etc.)
having a substantial interest in the business or profession of the individual or
any director or partner of such company or firm or any relative of such person. ,
Any person who carries on a business or profession and in his business or
profession, the assessee himself or his relative has a substantial interest.
Your Answer Any relative of such individual , Any person (individual, company, firm etc.)
having a substantial interest in the business or profession of the individual or
any director or partner of such company or firm or any relative of such person. ,
Any person who carries on a business or profession and in his business or
profession, the assessee himself or his relative has a substantial interest.
Select The Blank

Question 77 Deduction for remuneration from foreign sources for professors, teachers etc
under Section 80R is limited to ________% of such remuneration brought in
India.
Correct Answer 15
Your Answer 10
True/False
Question 78 Any expenditure incurred for earning the income which is included under the
head income from other sources will be allowed as deduction from such income
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provided that certain conditions are satisfied
Correct Answer True
Your Answer True

Question 79 Deduction from Capital Gains from the transfer of residential house property
under Section 54 is available to :-
Correct Answer Individual , HUF
Your Answer Individual , HUF , Company
True/False
Question 80 Income earned & received outside India & remitted to India is taxable for
resident & ordinary resident
Correct Answer True
Your Answer True

Question 81 Mr X has received Rs 200000 as income from salary, Rs 50000 income from
house property and he also received Rs 100000 income from specified units of
the mutual fund. What will be his total income
Correct Answer Rs 250000
Your Answer Rs 250000

Question 82 Standard deduction takes care of :-
Correct Answer Repairs & maintenance , Insurance premium , Ground rent
Your Answer Insurance premium
Match The Following

Individual partners & firms Are separate taxable entities Losses are shared equally
Partnership firm Companies can be partners Are separate taxable entities
Company partners Can not get salaries Companies can be partners
Individual partners Can be partners in any number Can be partners in any number
of firms of firms

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Question 84 Capital Gains arise on account of excess of transfer consideration over the
following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly and
exclusively in connection with the transfer
Your Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly and
True/False
Question 85 Income of a mutual fund is taxable even if it is authorized by RBI.
Your Answer False
Select The Blank

Question 86 If sum received is net of TDS then it is ________ to include in income from other
sources.
Correct Answer Grossed up
Your Answer Grossed up

Question 87 What is the tax treatment of Statutory Provident Fund?
Correct Answer Employer's Contribution to PF is not liable for any tax payment , Interest
credited to the employee's account is not liable for any tax payment. , The lump
sum received at the time of retirement or resignation or death is also exempt
under section 10(11) and 10(12).
Your Answer Employer's Contribution to PF is not liable for any tax payment , Interest
credited to the employee's account is not liable for any tax payment. , The lump
sum received at the time of retirement or resignation or death is also exempt
under section 10(11) and 10(12).
True/False
Question 88 Interest paid on the loan for acquiring a capital asset will be considered to be a
part of cost of acquisition.
Correct Answer True
Your Answer True

Question 89 What is the manner in which Income from Salaries is taxable?
Correct Answer Due basis or 'receipt' basis whichever is earlier.
Your Answer Due basis or 'receipt' basis whichever is earlier.

Question 90 Deduction from Capital Gains under Section 54F is for Capital Gains arising
from transfer of :-
Correct Answer Any Long Term Capital Asset
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Your Answer Any Long Term Capital Asset

Question 91 In case the assessee is not a company, a person(other than a company) who is
falling under One by Six economic criteria, the last date for filing the return is
prescribed as :-
Correct Answer 31st July of the Assessment year
Your Answer 31st July of the Assessment year
Select The Blank

Question 92 Registration charges in connection with the increasing of ________ share
capital of the company is not allowed as revenue expenditure.
Correct Answer Authorized
Your Answer Authorized
True/False
Question 93 The amount of telephone bills (including the mobile phone bills) of the employee
reimbursed by the employer is taxable in the hands of the employee.
Your Answer False

Question 94 As per which provision and section, every person, company or any other person
shall furnish his returns of income in the prescribed form on or before the
specified due date?
Correct Answer Section 139(1)
Your Answer Section 139(2)


Question The entertainment allowance received by the
Government employees is included in their salaries
and the deduction is allowed to the extent of least of
Correct Answer Actual amount of Entertainment Allowance received. ,
Rs. 5,000 , 1/5th of Salary
Your Answer Actual amount of Entertainment Allowance received. ,
True/False
Question Income Tax Act, 1961 recognizes Written Down Value
(WDV) method as well as straight line method for the
computation of depreciation u/s 32 this act.
Your Answer False

Question Profits earned by an Industrial Undertaking engaged
in other than infrastructure development is available
under Section 80IB for :-
Correct Answer Operation of Ship , Hotels situated in hilly area, rural
area or place of pilgrimage , Company engaged in
scientific and industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural
area or place of pilgrimage

Question Which of the following expenditure is in the nature of
revenue expenditure?
Correct Answer Expenditure incurred as discount on issue of
debentures
Your Answer Expenditure incurred as discount on issue of
debentures
Select The Blank

Question If sum received is net of TDS then it is ________ to
include in income from other sources.
True/False
Question Interest paid on the loan for acquiring a capital asset
will be considered to be a part of cost of acquisition.
Correct Answer True
Your Answer True

Question Mr. A whose Gross Total Income, before allowing
deductions under Chapter VI-A is Rs. 1,45,000, wants
to make the investments in the following alternative
forms Rs. 80,000 in PPF and Rs. 20,000 in
Infrastructure Bonds. The amount of rebate available
to him u/s 88 is :-
Correct Answer Rs. 18,000
Your Answer Rs. 18,000

Question Interest on specified securities or premium on
redemption is exempt for :-
Correct Answer Non resident Indian
Your Answer Non resident Indian
True/False
Question As per section 2(11) of the Income Tax Act, Block of
Assets includes both tangible as well as intangible
assets.
Correct Answer True
Your Answer True

Question Deductions in respect of Certain Incomes received
under Section 80L is available in respect of
Correct Answer Interest on Central or State Government Securities ,
Interest on National Saving Certificates (NSCs)
Interest on National Saving Scheme, 1992 (NSS) ,
Bank Interest
Your Answer Interest on Central or State Government Securities ,
Bank Interest
Question Tax liability of a person is based on :-

Question For the purpose of income tax, the perquisites can be
classified into :-
Correct Answer Perquisites which are taxable in case of all types of
employees , Perquisites which are taxable only in the
hands of specified employee
Your Answer Perquisites which are taxable in case of all types of
Select The Blank

Question For an individual as a citizen of India who leaves India
in the relevant previous year for the purpose of
employment has to be in India for ________ days or
more during previous year.
Correct Answer 182
Your Answer 182

Question Income earned in previous year is subjected to tax in
:-
Correct Answer Assessment year
Your Answer Assessment year

Question Following professional institutions have their incomes
exempt from tax :-
Select The Blank

Question ________ of the Tax Audit Report refers to the details
of various payments which are allowed as deduction
only if they are actually paid for.
Correct Answer Section 43B Clause No-21
Your Answer Section 43B Clause No-21

Question Short Term Capital Loss can be adjusted against :-
Select The Blank

Question To claim sec 10A deduction unit must be established
in ________.
Correct Answer Free Trade Zone
Your Answer Free Trade Zone

Question Assessment year is the period of 12 months starting
from :-
Correct Answer 1st April to 31st March
Your Answer 1st April to 31st March

Question Combined total of five heads of income equals :-
Correct Answer Gross total income
Your Answer Gross total income

Question If an employee does not avail of this leave travel
concession or assistance during a block of four
calendar years :-
Correct Answer Only one journey can be carried forward to the next
block.
Your Answer Only one journey can be carried forward to the next
block.
Select The Blank

Question To acquire PAN, a person shall apply in ________ to
the assessing officer.
Correct Answer Form No. 49A
Your Answer Form No. 49A

Question Deduction from Capital Gains under Section 54F is for
Capital Gains arising from transfer of :-
Your Answer House Property
Select The Blank

Question Where an assessee files or submits the returns as per
provisions of section 139 or in response to the notice
under section 142, the assessment officer undertakes
________ as per section 143(2) and section 143(3).
Correct Answer Scrutiny Assessment
Your Answer Scrutiny Assessment

Question Income of a professional association is exempt if its
objectives are :-
True/False
Question While computing the profits from Business and
profession, the business or profession must be carried
out during the previous year.
Correct Answer True
Your Answer True

Question In respect of leave travel concession If Mr. A has
availed the exemption only once or has not availed
any exemption at all, in the block of four years i.e.
1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of
four years i.e. 2002-2005 provided that he avails the
exemption of LTC in the first calendar year of the next
block i.e. 2002.
Your Answer He can carry over the exemption to the next block of
block i.e. 2002.

Question The amount accumulated to the credit of the
employee's provident fund account is paid at the time
of :-
Correct Answer Retirement , Resignation
Your Answer Retirement , Resignation

Question From annual value, following deductions are allowed :-
Correct Answer Standard deduction , Interest on borrowed capital ,
Municipal taxes
Your Answer Interest on borrowed capital , Municipal taxes

Question As a general principle, the Basic Salary or Wages,
Dearness Allowance and Bonus / Commission is :-

Question From GTI of a company following deductions under
chapter VI A are allowed
Correct Answer 80 G Donations , 80 HHB profits and gains from
projects outside India , 80 IA profits and gains of
infrastructure companies
Your Answer 80 G Donations , 80 IA profits and gains of

Question Annual value of any one palace in possession of a
former ruler is :-
Correct Answer Exempt
Your Answer Taxable
Select The Blank

Question If the Salary is more than Rs. 5,00,000, Standard
Deduction will be Rs.________.
Correct Answer 20000
Your Answer 20000

Question The amount of accumulated interest on NSCs
purchased in the earlier years is assumed to be
reinvested :-
Correct Answer And qualifies for tax rebate under section 88.
Your Answer And qualifies for tax rebate under section 88.
Select The Blank

Question Deduction u/s ________B is available for 10
consequent assessment years from the year of
commencement of production.
Correct Answer 10
Your Answer 10
True/False
Question Income from subletting is treated as income from
house property.
Your Answer False
Select The Blank

Question Section 80U allows the deduction in respect of the
________ .
Match The Following

Question Correct Answer Your Answer
Disallowable Litigation Expenses in Litigation Expenses in

Expenditure connection with connection with
recovery of a debt recovery of a debt
which is not a trading which is not a trading
debt debt
Business Includes trade, Includes trade,
commerce, or commerce, or
manufacture or any manufacture or any
adventure or concern adventure or concern in
in the nature of trade, the nature of trade,
commerce or commerce or
manufacture manufacture
Profession Includes vocation Includes vocation
Capital Expenditure Expenditure incurred Premium on

by a company with the redemption of
issue of rights shares Debentures
True/False
Question Any recreational facility provided by the employer to a
group of employees (not being restricted to a select
few employees) is not exempt from tax.
Your Answer False
True/False
Question In case of deductions for medical treatment under
Section 80DDB the amount of deduction will be
reduced by the amount received under an insurance
policy or the amount reimbursed by the employer.
Correct Answer True
Your Answer True
True/False
Question Any advance tax paid before 31st March is treated as
advance tax paid during the previous year.
Correct Answer True
Your Answer True

Question Municipal taxes paid is allowed as deduction from :-
Correct Answer Gross annual value
Your Answer Gross annual value
True/False
Question Entertainment Allowance received by the employees
from the private sector is taxable in the hands of the
employee.
Correct Answer True
Your Answer True
Match The Following

Any subscription made By an individual or a By an individual or a

to National Saving HUF is eligible for HUF is eligible for
Scheme rebate u/s 88 rebate u/s 88
Mr. A, a 70 years old RS.12,500 RS.12,500
Senior Citizen, has the
Gross Total Income of
Rs. 2,50,000 during
the Assessment Year
2005-2006. He
invested Rs. 50,000 in
the tax saving bonds of
ICICI on 10th June
2004. His tax liability
for the A Y 2005-2006.
During the Rs. 1,000 Rs. 1,000
Assessment Year
2005-2006, Mrs. A,
age 58 years, has the
Rs. 1,45,000 including
the dividend from
Indian companies
amounting to Rs.
10,000. She invests
Rs. 50,000 in PPF
during the said
Assessment Year. her
tax liabilit is
Any contribution made Is eligible for rebate Is eligible for rebate u/s
to a Public Provident u/s 88 88
Fund

Question Following incomes of local authorities are exempt :-
Correct Answer Capital gains , Other income , House property
Your Answer Capital gains , Other income , House property

Question For Deduction u/s 54EC from Capital Gains the
assessee should invest the whole or part of the capital
gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the long-
term capital asset
Your Answer Within six months from the date of transfer of the long-
term capital asset
True/False
Question Income from partnership firms is exempt from taxation
for the partners
Correct Answer True
Your Answer False
Registration 200425352
Number:
Name: Sarada J.H
Subject: Taxation
Assignment Status
12/02/2006
As On:
Result for this Assignment

Assignment Date 11/02/2006
Number of Correct Questions 39
Number of Skipped Questions 3
Number of Wrong Questions 8
Total Questions attempted 50
Total Marks obtained 85 Out of 100.
Result Pass
Taxation
-------------
Select The Blank

Question The basic advantage of having an agent in the export market is ________.
Correct Answer He is knowledgeable of the marketing condition
Your Answer He is knowledgeable of the marketing condition

Question How does the customer know about the product & is influenced to buy it?
Correct Answer Publicity , Advertising , Sales promotion
Your Answer Publicity , Advertising , Sales promotion

Question Which of the following is not included in foreign environment?
Correct Answer Local dimension
Your Answer Local dimension

Question Why should a market researcher check a country's import tariffs when he is
investigating it as an export market?
Correct Answer It can affect the competitiveness of product against products made within the
market
Your Answer It can affect the competitiveness of product against products made within the
market

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". What are the
distribution channels used for imports of silk products into USA market?
Correct Answer Merchant intermediaries , Departmental stores
Your Answer Merchant intermediaries , Departmental stores
True/False
Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Oriental entered the
US market in 1970 with a moderate export of Rs.20 million.
Your Answer False
Match The Following

Indirect exporting Home-based merchant Copyright
Business dimensions Channel network Channel network
Legal dimensions Copyright Use of patent
Licensing arrangement Use of patent Home-based merchant

Question What is important to take pricing decision?
Correct Answer Competition
Your Answer Competition
Select The Blank
Question In ________, the firm faces only one set of customers.
Correct Answer Domestic marketing
Your Answer Domestic marketing

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Oriental was an active
member of some councils, which are those?
Correct Answer Apparel Export Promotion Council , Woolen Export Promotion Council
Your Answer Apparel Export Promotion Council , Woolen Export Promotion Council

Question This question is based on the case study 'AB Enterprises'. What is the problem in
adapting AB Enterprises product in the market?
Correct Answer Novelty is lost due to ethnic character in AB Enterprises
Your Answer Novelty is lost due to ethnic character in AB Enterprises

Question What are the important infrastructure factors in evaluating production site?
Correct Answer Industrial site , Transportation & communication
Your Answer Industrial site , Transportation & communication

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Which are the two
years the imports of silk fabrics from Japan by USA was almost same?
Correct Answer 1982 , 1983
Your Answer 1982 , 1983
Select The Blank

Question ________dimensions include customs and practices
Correct Answer Business
Your Answer Business

Question What is the nature of direct export market?
Correct Answer Concentrated , Large potential sale
Your Answer Concentrated , Large potential sale

Question What does product-mix decision include?
Correct Answer Packaging
Your Answer Packaging

Question What are the internal sources of information?
Correct Answer Sales record , Correspondence from salesmen
Your Answer Sales record , Correspondence from salesmen
True/False
Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Mr.Patnaik felt that it
was high time that he appraises his agents' performance relating to the vast & expanding US
market.
Correct Answer True
Your Answer True

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". What were the options
Mr.Patnaik had to operate in the US market?
Correct Answer Opening a branch office , A subsidiary company
Your Answer Opening a branch office , A subsidiary company
Select The Blank

Question In indirect export channel, the market is ________.
Correct Answer Dispersed
Your Answer Dispersed
True/False
Question Strategies suggested in the Medium Term Export Plan include product-market
penetration strategy for existing products, product-market, diversification for new products & new
markets.
Correct Answer True
Your Answer True

Question Why is packaging so important for product planning?
Correct Answer As it enhances protection , As it gives shelf life for a product
Your Answer As it enhances protection , As it gives shelf life for a product
True/False
Question If foreign retailers are used, the products in question are industrial products rather than
consumer products.
Your Answer True

Question How is the nature of international strategy?
Correct Answer Depends on company's objectives , Varies from country to country
Your Answer Depends on company's objectives , Varies from country to country
Select The Blank

Question "make site booking" is a point of checklist of ________
Correct Answer Before the fair
Your Answer Before the fair

Question What marketing technique is used to know international marketing need?
Correct Answer Marketing information & research
Your Answer Marketing information & research

Question What are the benefits of participation in trade fair?
Correct Answer To get to know about competition , To know about the extent of product adaption
Your Answer To get to know about competition , To know about the extent of product adaption
Select The Blank

Question Experience survey, which is also called as ________.
Correct Answer Key informant survey
Your Answer Key informant survey

Question What is a foreign agent?
Correct Answer Independent middleman
Your Answer Independent middleman

Question What does political environment include?
Correct Answer Legal dimension
Your Answer Legal dimension
Match The Following

External factor Competitive profile Competitive profile
Ethnocentric orientation Overseas operation conducted from home country Overseas operation
conducted from home country
Polycentric orientation Each market is unique Each market is unique
Target market Marketing strategy Marketing strategy
True/False
Question In marginal cost pricing for export, competition in foreign markets requires quotation of a
lower price
Correct Answer True
Your Answer True
True/False
Question Policies or regulations regarding quality control & inspection vary considerably between
nations.
Correct Answer True
Your Answer True
Select The Blank

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Oriental Silk Private
Limited, is a ________ unit, was one of the leading Indian manufacturers & exporters of silk
fabrics & made-ups
Correct Answer 100% export oriented
Your Answer 100% export oriented
Select The Blank

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". The bulk of the trade
was handled by ________
Correct Answer Central buying organizations
Your Answer Foreign agents
True/False
Question If business is variable, the company will choose the purchasing or subcontracting
alternatives.
Correct Answer True
Your Answer True

Question What is the meaning of offshore purchasing?
Correct Answer Relationship between independent buyer & seller for exchange of good for
money
Your Answer Relationship between independent buyer & seller for exchange of good for money
Select The Blank
Question Many companies modify their products/promotion strategies to suit ________ of the
population of the different countries.
Correct Answer Tastes & preferences
Your Answer Tastes & preferences
True/False
Question Companies with smaller needs, an independent supplier will be less active.
Your Answer False
True/False
Question Catalogues contain a list of all competitors with product details.
Your Answer False

Question What is correct according to geocentric orientation?
Correct Answer Companies view the entire world as a single market , Uniform inventory
management & training
Your Answer Companies view the entire world as a single market , Uniform inventory
management & training
True/False
Question The area of change relates to product adaption requires upgradation of technology and
huge investment in brands.
Correct Answer True
Your Answer True
Select The Blank

Question This question is based on the case study "Chow Flowers Co. Ltd.". ________ was
Thailand's second largest export market for artificial flowers, mostly polyester or hand-wrapped.
Correct Answer Canada
Your Answer Canada

Question What are the similarities between domestic & international marketing?
Correct Answer Satisfying consumers need
Your Answer Satisfying consumers need

Question What is the need of marketing research for export-import trade?
Correct Answer To reduce the distance between an exporter & his customers in terms of
marketing
Your Answer To reduce the distance between an exporter & his customers in terms of marketing

Question What is the avenue of entry into foreign markets?
Correct Answer Contract manufacturing
Your Answer Contract manufacturing

Question What is the principal functional division of ministry of commerce & industry?
Correct Answer Export Industries Division
Your Answer Export Industries Division
----------

Question What are the factors to be considered in cluster analysis?
Correct Answer Limited number of clusters due to limitation of market potential , Clusters are not
water tight compartment , Evaluating the quality of cluster is difficult
Your Answer Limited number of clusters due to limitation of market potential , Clusters are not
water tight compartment , Evaluating the quality of cluster is difficult

Question Clarity of questions and instructions for filling the form is essential in :-
Correct Answer Mail survey
Your Answer Data analysis

Question The technique through which objects/ cases are classified into relative homogeneous
groups or clusters is known as :-
Correct Answer Cluster analysis
Your Answer Cluster analysis

Question Mean or average value is used to estimate when data have been collected using :-
Correct Answer Interval or ratio scale
Your Answer Interval or ratio scale
Select The Blank

Question In ________ method the research analyst is not concerned with cause and research
relationship.
Correct Answer Diagnostic
Your Answer Diagnostic

Question Which are the New Delhi based Research Institutions?
Correct Answer NRDC , CSIR , Cement Research Institute of India
Your Answer NRDC , CSIR , Cement Research Institute of India

Question Market Research is done to
Correct Answer Explore the Opportunities
Your Answer Explore the Opportunities
True/False
Question "Consumer Panel" is a specialized market research technique.
Your Answer False
Match The Following

"What might this be ?" Inkblot test Inkblot test
Aided Recall Depth Research Depth Research

Doesn’t intend to tell Projective techniques Projective techniques
Ease of construction Likert scale Likert scale
True/False
Question In regression analysis, dependent variables can be expressed as a linear function of
impendent variables.
Correct Answer True
Your Answer True
True/False
Question When company prepares a long range plan it is unpublished internal source of
information.
Correct Answer True
Your Answer True
Select The Blank

Question Association technique is a type of ________.
Correct Answer Projective technique
Your Answer Projective technique

Question The impact of promotional slogans on the consumers can be studied with
Correct Answer Association technique
Your Answer Association technique
True/False
Question Brand image building is not important in case of industrial product for quality.
Your Answer False

Question Which publications are used for research on Chemical Industry?
Correct Answer Indian Chemical Directory , Chemical Industry News , Chemical & Petro
Chemicals Journal
Your Answer Indian Chemical Directory , Chemical Industry News , Chemical & Petro Chemicals
Journal

Question Spreading the sample through the entire population following a regular pattern is known
as :-
Correct Answer Systematic sampling
Your Answer Systematic sampling
Select The Blank

Question In absence of proper________ the market research becomes a data collection exercise.
Correct Answer Problem Definition
Your Answer Analysis

Question Which institutions should be contacted for research on Paint Chemicals?
Correct Answer National Chemical Laboratory, Pune , Industrial Research & Development Center
, Building Research Institute
Your Answer National Chemical Laboratory, Pune , Industrial Research & Development Center ,
Building Research Institute

Question The objectives of marketing research are
Correct Answer To understand the consumer needs and wants , To explore the new markets , To
analyze the competitors
Your Answer To understand the consumer needs and wants , To explore the new markets , To
analyze the competitors

Question Ultra violet ink is used to disguise customer coding. This activity is :-
Correct Answer A disapproved method
Your Answer A disapproved method
Select The Blank

Question Through cluster analysis objects/cases are classified into relatively________ group
called cluster.
Correct Answer Homogeneous
Your Answer Homogeneous
Match The Following

Dangler POP POP
POP Communication medium Communication medium
Opinion Polls Daily basis Daily basis
Corporate Image Study Advertising research Advertising research

Question Ethical issues to be observed while writing a report are :-
Correct Answer No deliberate misinterpretations , Marketing problems should be designed to suit
hidden agenda , Complete confidentiality and secrecy of data
Your Answer No deliberate misinterpretations , Marketing problems should be designed to suit
hidden agenda , Complete confidentiality and secrecy of data
Select The Blank

Question Multiple Choice is a ________type of question.
Correct Answer Close ended
Your Answer Close ended

Question The conjoint analysis helps to enable company's to :-
Correct Answer Conduct brand swot analysis
Your Answer Conduct brand swot analysis

Question In the Internet era, qualitative research is possible through :-
Correct Answer Chat sessions
Your Answer Chat sessions
Select The Blank

Question ________is an important communication medium that helps recall advertising.
Correct Answer Point of Purchase(POP)items
Your Answer Point of Purchase(POP)items
True/False
Question In the Funnel approach, specific questions come first and general questions later.
Your Answer False

Question In resources for marketing research skilled staff plays an important role in :-
Correct Answer Maintaining data , Dealing with different situation and problems , Timely
completion of research
Your Answer Maintaining data , Dealing with different situation and problems , Timely completion
of research
Select The Blank

Question Convenience Sampling is used for ________.
Correct Answer Exploratory research
Your Answer Exploratory research
True/False
Question The person conducting pharma research should be well qualified so that not to waste
Doctors time.
Correct Answer True
Your Answer True
True/False
Question The limitations with regression forecasting is that independent variables must be
forecasted before forecasting the dependent variables.
Correct Answer True
Your Answer True

Question Main features of Technical Report are :-
Correct Answer Minute details of planning data collection , Analysis , Interpretation
Your Answer Minute details of planning data collection , Analysis , Interpretation

Question How people allocate their time and money to certain products and factors is depicted by
Correct Answer Psychographic Variable
Your Answer Psychographic Variable
True/False
Question Question phrasing and structure are eliminated in Semantic differential scale.
Correct Answer True
Your Answer True
True/False
Question The popularity of Likert scale is due to its ease of construction and administration.
Correct Answer True
Your Answer True

Question Which are the Export Promotion Councils?
Correct Answer Cashew Export Promotion Council , Handloom Export Promotion Council , Gem
& Jewellery Export Promotion Council
Your Answer Cashew Export Promotion Council , Handloom Export Promotion Council , Gem &
Jewellery Export Promotion Council
True/False
Question The written contract of a research should cover the penalty clause covering deficits
such as delays, inadequate data.
Correct Answer True
Your Answer True

Question The producers in the sellers' market are also forced to take decisions based on the
market information because
Correct Answer The resources are scarce
Your Answer The resources are scarce

Question Scale Intervals can be used for
Correct Answer Age
Your Answer Age
Select The Blank

Question Bibliography contains ________.
Correct Answer Information of references and secondary data
Your Answer Information of references and secondary data

Question Online survey methods include :-
Correct Answer Email survey , HTML survey , Downloadable interactive surveys
Your Answer Email survey , HTML survey , Downloadable interactive surveys

Question Data of market research cannot be maintained :-
Correct Answer Without experienced and educated research staff
Your Answer Without experienced and educated research staff

Question Pretesting of Questionnaire includes testing of :-
Correct Answer Question content , Time taken to answer questions , Categorisation
Your Answer Question content , Time taken to answer questions , Categorisation

Question Identification of Target Population is facilitated by :-
Correct Answer Well defined research objectives , Alternative, reasonable/target population
definitions , Specifications for exclusion in target population
Your Answer Well defined research objectives , Alternative, reasonable/target population
definitions , Specifications for exclusion in target population
Select The Blank

Question ________are used for National Panel Studies.
Correct Answer Quota controls
Your Answer Quota controls
Select The Blank

Question Finding out the number of vehicles at a given junction is a ________ method.
Correct Answer Direct Observation
Your Answer Direct Observation
Question As a general principle, the Basic Salary or Wages, Dearness
Allowance and Bonus / Commission is :-
Select The Blank

Question If assessee owns more than one house properties, he can get benefit
of nil annual value for any one house property ________.
Correct Answer As per his choice
Your Answer As per his choice
True/False
Question Any recreational facility provided by the employer to a group of
employees (not being restricted to a select few employees) is not
exempt from tax.
Your Answer False

Question What are the types of Provident Fund?
Correct Answer Statutory Provident Fund , Recognized Provident Fund ,

Unrecognized Provident Fund
Your Answer Statutory Provident Fund , Recognized Provident Fund ,

Question The least of the following is the exemption available to an employee if
he is in receipt of house rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in Mumbai,
Kolkata, Chennai and Delhi and 40% of the Salary when the
accommodation is situated at any other place. , Actual amount of
HRA received by the employee. , Excess of rent paid over 10% of the
Salary.
Your Answer 50% of the Salary where such accommodation is situated in Mumbai,
Kolkata, Chennai and Delhi and 40% of the Salary when the
accommodation is situated at any other place. , Actual amount of
HRA received by the employee. , Excess of rent paid over 10% of the
Salary.

Question To get deduction of Rs 150000/- as interest on borrowed capital
assessee needs to satisfy conditions i.e. :-
Correct Answer Borrowal is after 1st April 1999 , Construction is completed in 3 years
Your Answer Borrowal is after 1st April 1999 , Construction is completed in 3 years

Question The entertainment allowance received by the Government employees
is included in their salaries and the deduction is allowed to the extent
of least of the following amounts :-
Correct Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment
Allowance received.
Your Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment
Allowance received.
Select The Blank

Question Section 35AC of the Act applies to any sum paid by the assessee to
a public sector company or a local authority or an association
approved by the national committee for ________ for carrying out
any project in upliftment of public.

Question The provisions under section 44AB of the Act, is applicable to the
person carrying on the profession and whose gross receipts in
profession :-
Correct Answer Exceeds Rs.10 lakhs in any previous year
Your Answer Exceeds Rs.40 lakhs in any previous year

Question As per the provision of section 143(2) and 143(3) scrutiny
assessment made by assessing officer in order to ensure that :-
Correct Answer Assessee has not understated the income , Assessee has not
overstated the loss , Assessee has under paid the taxes
Your Answer Assessee has not understated the income , Assessee has not
overstated the loss , Assessee has under paid the taxes , Assessee
has not been allotted the PAN

Question Annual value of any one palace in possession of a former ruler is :-
Your Answer Exempt
True/False
Question Interest paid on the loan for acquiring a capital asset will not be
considered to be a part of cost of acquisition.
Your Answer True

Question Previous year always ends on :-
Correct Answer 31st March
Your Answer 31st March

Question Perquisites which are taxable only in the hands of specified employee
include the following categories of perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal
attendant , Gas, electricity and water provided for personal
consumption
Your Answer Motor Car , Services of sweeper, gardener, watchman or personal
attendant , Gas, electricity and water provided for personal
consumption
Select The Blank

Question Short term Capital Gains is taxed at ________.
Correct Answer Normal Tax rates
Your Answer Normal Tax rates

Question Income of notified news agencies is exempt provided :-
True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the
company carried out, the report of such audit should be enclosed to
the Tax Audit Report.
Correct Answer True
Your Answer True
True/False
Question If an assessee gets the salary from more than one employer during
an Assessment Year, Salary received from all the employers will be
aggregated and then the Standard Deduction will be allowed.
Correct Answer True
Your Answer True

Question The amount accumulated to the credit of the employee's provident
fund account is paid at the time of :-

Question The amount of advance tax payable by non corporate assessees
before 15th September of Previous year is :-
Correct Answer 30% of advance tax payable
Your Answer 30% of advance tax payable

Question Any loans or deposits borrowed or repaid under section 269SS of the
Act provides that the said provisions will not apply to the loans or
deposits accepted by :-
Correct Answer Government , Government company , Banking company including
cooperative bank and post office savings bank
Your Answer Government , Government company , Banking company including

Question The amount of advance tax payable by corporate assessees before
15th March of Previous year is :-

Question The due date prescribed for filing the returns of income in Form No.
2C is
Correct Answer 31st October of the respective Assessment year
Your Answer 31st October of the respective Previous year
True/False
Question The amount of expenses including membership fees and annual fees
incurred by the employee on credit card and which are paid by the
employer shall be added as the perquisites unless the said expenses
are incurred wholly and exclusively for official purposes.
Correct Answer True
Your Answer True

Question Which of the following expenses should be debited to P & L Account,
but disallowed for Income tax purpose?
Correct Answer Wealth Tax , Personal expenditure , Income Tax
Your Answer Wealth Tax , Revenue expenditure , Personal expenditure

Question The provisions regarding set off and carry forward of loses are
contained in :-
Correct Answer Sections 70 to 80 of the Income Tax Act, 1961.
Your Answer Sections 70 to 80 of the Income Tax Act, 1961.

Question A partnership firm is an agreement between not more than :-
Correct Answer 20 persons
Your Answer 20 persons

Question Deduction from Capital Gains under Section 54B is for Capital Gains
arising from transfer of :-
Correct Answer Agricultural Land
Your Answer Long Term Capital Asset other than House Property
Select The Blank

Question To acquire PAN, a person shall apply in ________ to the assessing
officer.

Question Any amount deposited by an Individual or a HUF in 10 year or 15
year account under the Post Office Saving Bank (CTD) Rules, 1959.
The account can be in the name of :-
Your Answer The individual himself , A minor of whom he is the guardian. , Spouse
of individual
True/False
Question While computing the profits from Business and profession, the
business or profession must be carried out during the previous year.
Correct Answer True
Your Answer True

Question Following news agencies are specified by the Central Government as
specified news agencies :-
Correct Answer UNI , PTI
Your Answer PTI , NDTV
Select The Blank

Question Any expenditure incurred by the assessee for any purpose which is
________ or which is prohibited by law shall not be allowed as
business expenditure
Your Answer Anti social
True/False
Question If assessee owns more than one house properties, annual value of
any one of the house property can be treated as nil, and such option
can be changed year on year basis.
Correct Answer True
Your Answer True
Match The Following

Superannuation Fund It is an employee welfare It is an employee welfare

scheme scheme
provisions of Provident provisions of Provident Fund
Fund Act, 1925. Act, 1925.
Recognized Provident Fund the provisions of the provisions of Employees
Employees Provident Fund Provident Fund and
and Miscellaneous Miscellaneous Provisions
Provisions Act, 1952 apply Act, 1952 apply to this fund.
to this fund.
Unrecognized Provident The provident fund which is The provident fund which is
Fund not recognized by the not recognized by the
income tax authorities . income tax authorities .
Select The Blank

Question If the Salary is more than Rs. 5,00,000, Standard Deduction will be
Rs.________.
Your Answer 20000
Select The Blank

Question Mr. Ram is employed by the Central Government as accountant
whose gross salary income is Rs 6,00,000. He can claim standard
deduction of Rs ________ u/s 16(i) of the IT Act.
Match The Following

Deduction in case of Section 80U Section 80U

permanent physical
disability
Deductions for Donations Section 80G Section 80G
Paid
Deduction for Rent Paid Section 80GG Section 80GG
Deduction in respect of Section 80L Section 80L

Interest on Bank Deposits
True/False
Question The consideration for transfer of Capital Asset is received by the
transferor is not material while Capital gain chargeable to tax.
Correct Answer True
Your Answer True
True/False
Question The payments for claiming the tax rebate u/s 88 of the IT Act should
be made out of the income chargeable to tax.
Correct Answer True
Your Answer True

Question In case of any contribution made by an individual or a HUF to notified
units of any approved mutual fund or of Unit Trust of India in
accordance with a notified scheme (Equity Linked Savings Scheme)
:-
Correct Answer The maximum allowable limit is Rs. 10,000
Your Answer Qualifies for tax rebate under section 88D.
True/False
Question Dividend received from domestic company to its shareholders is
taxable in the hands of the shareholder.
Your Answer False
Select The Blank

Question Loss from the activity of owning and maintaining the race horses can
be carried forward and set off in the subsequent Assessment Years
subject to the limit of ________ Assessment years.
Correct Answer 4
Your Answer 4
Select The Blank

Question If the property becomes the property of the assessee before
________, the Fair Market Value of the property of the capital asset
on that date will be considered to be the cost of acquisition
Correct Answer 1st April 1981
Your Answer 1st April 1991
Select The Blank

Question For an individual as a citizen of India who leaves India in the relevant
previous year for the purpose of employment has to be in India for
________ days or more during previous year.
Correct Answer 182
Your Answer 182
Select The Blank

Question After deducting interest on capital & remuneration to partners, firm is
required to pay tax @ ________
Correct Answer Tax 35% + 2% SC +2% EC
Your Answer Tax 35% + 2% SC +2% EC

Question Under the clause No-32 of the Act, in the Tax Audit Report, the
Auditor is required to give the accounting calculation in ratios of :-
Correct Answer Gross profit/turnover , Net profit/turnover , Stock in trade/turnover
Your Answer Gross profit/turnover , Net profit/turnover , Stock in trade/turnover


Question The entertainment allowance received by the Government employees is
included in their salaries and the deduction is allowed to the extent of least of the
following amounts :-
Correct Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 ,
1/5th of Salary
Your Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 ,
1/5th of Salary
True/False
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method as
well as straight line method for the computation of depreciation u/s 32 this act.
Your Answer False

Question Profits earned by an Industrial Undertaking engaged in other than
infrastructure development is available under Section 80IB for :-
Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or place
of pilgrimage , Company engaged in scientific and industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural area or place
of pilgrimage

Question Which of the following expenditure is in the nature of revenue
expenditure?
Select The Blank

Question If sum received is net of TDS then it is ________ to include in income
from other sources.
True/False
Question Interest paid on the loan for acquiring a capital asset will be considered to
be a part of cost of acquisition.
Correct Answer True
Your Answer True

Question Mr. A whose Gross Total Income, before allowing deductions under
Chapter VI-A is Rs. 1,45,000, wants to make the investments in the following alternative
forms Rs. 80,000 in PPF and Rs. 20,000 in Infrastructure Bonds. The amount of rebate
available to him u/s 88 is :-

Question Interest on specified securities or premium on redemption is exempt for :-
True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both
tangible as well as intangible assets.
Correct Answer True
Your Answer True

Question Deductions in respect of Certain Incomes received under Section 80L is
available in respect of
Correct Answer Interest on Central or State Government Securities , Interest on
National Saving Certificates (NSCs) Interest on National Saving Scheme, 1992 (NSS) ,
Bank Interest
Your Answer Interest on Central or State Government Securities , Interest on
Bank Interest


Question For the purpose of income tax, the perquisites can be classified into :-
Correct Answer Perquisites which are taxable in case of all types of employees ,
Perquisites which are taxable only in the hands of specified employee
Your Answer Perquisites which are taxable in case of all types of employees ,
Select The Blank

previous year for the purpose of employment has to be in India for ________ days or
Correct Answer 182
Your Answer 182
Question Income earned in previous year is subjected to tax in :-

Question Following professional institutions have their incomes exempt from tax :-
Select The Blank

Question ________ of the Tax Audit Report refers to the details of various
payments which are allowed as deduction only if they are actually paid for.

Select The Blank

Question To claim sec 10A deduction unit must be established in ________.

Question Assessment year is the period of 12 months starting from :-


Question If an employee does not avail of this leave travel concession or assistance
Select The Blank

Question To acquire PAN, a person shall apply in ________ to the assessing officer.

Question Deduction from Capital Gains under Section 54F is for Capital Gains
Select The Blank

Question Where an assessee files or submits the returns as per provisions of section
139 or in response to the notice under section 142, the assessment officer undertakes

Question Income of a professional association is exempt if its objectives are :-
True/False
Question While computing the profits from Business and profession, the business or
profession must be carried out during the previous year.
Correct Answer True
Your Answer True

Question In respect of leave travel concession If Mr. A has availed the exemption
only once or has not availed any exemption at all, in the block of four years i.e. 1998-
2001 then :-
Correct Answer He can carry over the exemption to the next block of four years i.e.
2002-2005 provided that he avails the exemption of LTC in the first calendar year of the
next block i.e. 2002.
Your Answer He can carry over the exemption to the next block of four years i.e.

Question The amount accumulated to the credit of the employee's provident fund
account is paid at the time of :-

Correct Answer Standard deduction , Interest on borrowed capital , Municipal taxes

Question As a general principle, the Basic Salary or Wages, Dearness Allowance
and Bonus / Commission is :-

Question From GTI of a company following deductions under chapter VI A are
allowed
Correct Answer 80 G Donations , 80 HHB profits and gains from projects outside
India , 80 IA profits and gains of infrastructure companies
Your Answer 80 G Donations , 80 IA profits and gains of infrastructure
companies

Your Answer Taxable
Select The Blank

Rs.________.
Your Answer 20000

Question The amount of accumulated interest on NSCs purchased in the earlier
years is assumed to be reinvested :-
Select The Blank

Question Deduction u/s ________B is available for 10 consequent assessment years
from the year of commencement of production.
Correct Answer 10
Your Answer 10
True/False
Question Income from subletting is treated as income from house property.
Your Answer False
Select The Blank

Question Section 80U allows the deduction in respect of the ________ .
Match The Following

Disallowable Expenditure Litigation Expenses in connection with recovery of a debt

which is not a trading debt Litigation Expenses in connection with recovery of a debt
which is not a trading debt
Business Includes trade, commerce, or manufacture or any adventure or concern in

the nature of trade, commerce or manufacture Includes trade, commerce, or
manufacture or any adventure or concern in the nature of trade, commerce or
manufacture
Capital Expenditure Expenditure incurred by a company with the issue of rights shares
Premium on redemption of Debentures
True/False
employees (not being restricted to a select few employees) is not exempt from tax.
Your Answer False
True/False
Question In case of deductions for medical treatment under Section 80DDB the
amount of deduction will be reduced by the amount received under an insurance policy or
Correct Answer True
Your Answer True
True/False
Question Any advance tax paid before 31st March is treated as advance tax paid
during the previous year.
Correct Answer True
Your Answer True

True/False
Question Entertainment Allowance received by the employees from the private
sector is taxable in the hands of the employee.
Correct Answer True
Your Answer True
Match The Following

Any subscription made to National Saving Scheme By an individual or a HUF is eligible

for rebate u/s 88 By an individual or a HUF is eligible for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs. 2,50,000 during
the Assessment Year 2005-2006. He invested Rs. 50,000 in the tax saving bonds of ICICI
on 10th June 2004. His tax liability for the A Y 2005-2006. RS.12,500 RS.12,500
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross Total
Income of Rs. 1,45,000 including the dividend from Indian companies amounting to Rs.
10,000. She invests Rs. 50,000 in PPF during the said Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund Is eligible for rebate u/s 88 Is
eligible for rebate u/s 88


Question For Deduction u/s 54EC from Capital Gains the assessee should invest the
whole or part of the capital gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the long-term
capital asset
Your Answer Within six months from the date of transfer of the long-term
capital asset
True/False
Question Income from partnership firms is exempt from taxation for the partners
Correct Answer True
Your Answer False

Correct Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 ,
1/5th of Salary
Your Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 ,
1/5th of Salary
True/False
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method as
Your Answer False

Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or place
of pilgrimage , Company engaged in scientific and industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural area or place
of pilgrimage

expenditure?
Select The Blank

from other sources.
True/False
Correct Answer True
Your Answer True

Chapter VI-A is Rs. 1,45,000, wants to make the investments in the following alternative
forms Rs. 80,000 in PPF and Rs. 20,000 in Infrastructure Bonds. The amount of rebate

True/False
Correct Answer True
Your Answer True

Question Deductions in respect of Certain Incomes received under Section 80L is
available in respect of
Bank Interest
Bank Interest


Select The Blank

Correct Answer 182
Your Answer 182

Select The Blank

payments which are allowed as deduction only if they are actually paid for.

Select The Blank




Question If an employee does not avail of this leave travel concession or assistance
Select The Blank


Question Deduction from Capital Gains under Section 54F is for Capital Gains
Select The Blank


True/False
Question While computing the profits from Business and profession, the business or
profession must be carried out during the previous year.
Correct Answer True
Your Answer True

2001 then :-




allowed
Your Answer 80 G Donations , 80 IA profits and gains of infrastructure
companies

Your Answer Taxable
Select The Blank

Rs.________.
Your Answer 20000

Select The Blank

Question Deduction u/s ________B is available for 10 consequent assessment years
Correct Answer 10
Your Answer 10
True/False
Your Answer False
Select The Blank

Match The Following



manufacture
True/False
employees (not being restricted to a select few employees) is not exempt from tax.
Your Answer False
True/False
Question In case of deductions for medical treatment under Section 80DDB the
amount of deduction will be reduced by the amount received under an insurance policy or
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

True/False
Question Entertainment Allowance received by the employees from the private
sector is taxable in the hands of the employee.
Correct Answer True
Your Answer True
Match The Following

Any subscription made to National Saving Scheme By an individual or a HUF is eligible

for rebate u/s 88 By an individual or a HUF is eligible for rebate u/s 88
on 10th June 2004. His tax liability for the A Y 2005-2006. RS.12,500 RS.12,500
Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund Is eligible for rebate u/s 88 Is


capital asset
capital asset
True/False
Correct Answer True
Your Answer False

Question Foreign allowance received by an Indian national is exempt if it is paid by
:-
Correct Answer Government of India
Your Answer Government of India

Question For the purpose of section 80IA, the term eligible business means :-
Correct Answer Developing, maintaining or operating any infrastructure facility
where the term infrastructure facility means a road (including a toll road, a bridge or a
rail system) or a highway project or a water supply project. , Developing, maintaining or
operating an industrial park or special economic zones notified by the Central
Government , Generation or distribution of power
Your Answer Developing, maintaining or operating an industrial park or special
economic zones notified by the Central Government , Generation or distribution of power
, Developing, maintaining or operating any infrastructure facility where the term
infrastructure facility means a road (including a toll road, a bridge or a rail system) or a
highway project or a water supply project.
True/False
Question For being resident of India, a person must be citizen of India.
Your Answer False

Question The due date prescribed for filing the returns of income in Form No. 2C is
Your Answer 31st October of the respective Assessment year

True/False
Question A person who is a Senior Citizen who has attained the age of 65 years is
not entitled to the rebate u/s 88 of the Act.
Your Answer False

Question The total amount of rebates under Section 88, Section 88B, Section 88C
and Section 88D of the Act. shall :-
True/False
Question A company is resident of India if in any previous year it is an Indian
Company even though control & management are situated outside India.
Your Answer False

allowed
Your Answer 80 G Donations , 80 HHB profits and gains from projects outside
True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the
company carried out, the report of such audit should be enclosed to the Tax Audit Report.
Correct Answer True
Your Answer True
Match The Following

Deductions of Rent, Rates, Repairs, Taxes and Insurance on Buildings are available
u/s 30 u/s 30
Deduction of Depreciation is available u/s 32 u/s 32
General deductions are allowed as deductions while calculating profits from business and
profession u/s 37 u/s 37
Deductions of Repairs & maintenance of machinery, plant & furniture are available
u/s 31 u/s 31

units of any approved mutual fund or of Unit Trust of India in accordance with a notified
scheme (Equity Linked Savings Scheme) :-
Your Answer The maximum allowable limit is Rs. 10,000
True/False
Question The value of benefit resulting from the payment made by the employer in
a club for any expenditure incurred by the employee shall be taken as perquisites unless
the said expenses are incurred wholly and exclusively for official purposes.
Correct Answer True
Your Answer True

Question What is the treatment of principal amount of loan borrowed for the
purchase or construction of a residential house?
Correct Answer Rebate u/s 88 for such amount not exceeding Rs. 20,000
Your Answer Rebate u/s 88 for such amount not exceeding Rs. 20,000
True/False
Question Rebates as per the provisions of Section 88 of the Act are not available
from the tax on longterm capital gains.
Correct Answer True
Your Answer True

Question Following specific incomes are taxable under the heading income from
other sources :-
Correct Answer Winning from betting , Interest on securities of local authority ,
Bonus from key man insurance policy
Your Answer Winning from betting , Interest on securities of local authority
True/False
Question Deductions available as per the provisions of Chapter VI of the Act are not
available for the long-term capital gains.
Correct Answer True
Your Answer True
True/False
Question Income earned & received outside India & remitted to India is taxable for
Correct Answer True
Your Answer True

Question What is the due date for filing Annual return for TDS from Salaries?
Correct Answer 30th June of Assessment Year
Your Answer 30th June of Assessment Year

Question The least of the following is the exemption available to an employee if he
is in receipt of house rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in
Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is
situated at any other place. , Actual amount of HRA received by the employee. , Excess
of rent paid over 10% of the Salary.
Your Answer 50% of the Salary where such accommodation is situated in
Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is
situated at any other place. , Actual amount of HRA received by the employee.
Select The Blank

Question If the CC of the engine is more than 1..6 liters and the motor car is owned
or hired by the employer and is used partly of official and partly for personal purposes
and if running and maintenance expenses are borne by the employee then the value of
perquisite will be Rs.________ per month plus Rs.600 if car is chauffer driven car.
Correct Answer 600
Your Answer 600


Question Under the clause No-32 of the Act, in the Tax Audit Report, the Auditor is
required to give the accounting calculation in ratios of :-

Question If taxable income is less than 7.5% of book profit, income tax is payable
@ of :-
Correct Answer 0.1
Your Answer 0.1
Select The Blank

Question In case of foreign companies rate of tax is ________.
Correct Answer 0.35
Your Answer 0.2
True/False
Question Interest is payable by the assessee for not paying the Advance tax or if the
Advance tax paid by the assessee is less than 80% of the Assessed tax after adjusting the
amount of TDS and Advance tax Paid
Your Answer True


Question Loss from owning and maintaining race horses can be adjusted against :-
Correct Answer Only the income arising out of the same activity
Your Answer Only the income arising out of the same activity

Question Municipal taxes are payable on :-
Correct Answer Municipal valuation
Your Answer Municipal valuation
True/False
Question Dividend received from domestic company to its shareholders is taxable in
the hands of the shareholder.
Your Answer False
Select The Blank

Question Company means any ________ Company.
Correct Answer Indian
Your Answer Domestic Company

Question Section 35D applies to the preliminary expenses incurred by a company,
which consists of :-
Correct Answer Expenditure in connection with the preparation of
feasibility/project report, engineering services, or conducting market survey , Legal
charges and fees for registering the company as per the provisions of company Act, 1956
, Charges in connection with drafting and printing of memorandum of association and
Articles of Association
Your Answer Expenditure in connection with the preparation of
feasibility/project report, engineering services, or conducting market survey , Legal
charges and fees for registering the company as per the provisions of company Act, 1956
, Charges in connection with drafting and printing of memorandum of association and
Articles of Association

Question Perquisites which are taxable only in the hands of specified employee
include the following categories of perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal
attendant , Gas, electricity and water provided for personal consumption
Your Answer Motor Car , Gas, electricity and water provided for personal
consumption , Amount spent on training of employees or fees paid for refresher
management course
Select The Blank

Question Loss under the head Income from Capital Gains, to the extent it is long
term capital loss can be carried forward and set off in the subsequent Assessment Years
against the ________ subject to the limit of 8 Assessment years.
Correct Answer Long term Capital Gains
Your Answer Long term Capital Gains

Question For charging the income in the form of salaries :-
Correct Answer There needs to be an employer-employee relationship between the
payer and the payee.
Your Answer There needs to be an employer-employee relationship between the
payer and the payee.
True/False
Question The amount of telephone bills (including the mobile phone bills) of the
employee reimbursed by the employer is exempt from tax.
Correct Answer True
Your Answer True
True/False
incurred by the employee on credit card and which are paid by the employer shall be
added as the perquisites unless the said expenses are incurred wholly and exclusively for
official purposes.
Correct Answer True
Your Answer True

Question The amount of advance tax payable by corporate assessees before 15th
September of Previous year is :-

Question As per which provision and section, every person, company or any other
person shall furnish his returns of income in the prescribed form on or before the
specified due date?
Select The Blank

Question ________ is the tax payable on the manufacturing of goods.
Your Answer Sales tax

Question The return of income is required to be filed by all the companies, except
those covered under section 25 of the companies Act,1956 in the :-
Correct Answer Form No. 1
Your Answer Form No. 1
Match The Following



manufacture
Expenditure incurred by a company with the issue of rights shares

Question The sum total of all the heads of income clubbed together gives the
amount of :-
Correct Answer Gross Total Income
Your Answer Gross Total Income
Select The Blank


Your Answer Standard deduction , Interest on borrowed capital , Municipal taxes

Question The rebate u/s 88 is available to an :-
Taxation-Saroj2
Select The Blank

Correct Answer 182
Your Answer 182


Question The payments for claiming the rebate u/s 88 should :-
Correct Answer Be made out of the income chargeable to tax.
Your Answer Be made out of the income chargeable to tax.

Question As per which provision and section, every person, company or any other
person shall furnish his returns of income in the prescribed form on or before the
specified due date?
Select The Blank

Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax
rebate of ________u/s 88C of the IT Act.
Your Answer Nil

Question Rebate is allowed on any subscription made to National Saving Scheme by :-
Correct Answer An individual , A HUF
Your Answer An individual , A HUF , Partnership Firms

Question For the purpose of taxability of perquisite a specified employee means :-
Correct Answer The person who is director of a company , The employee who has
substantial interest in the company by having 20% or more of the voting power , The
employee whose income under the head salaries (including all the taxable monetary
payments of salary but excluding the value of any non-monetary benefits or perquisites),
after allowing deductions under Section 16, exceeds Rs. 50,000
Your Answer The person who is director of a company , The employee who has
substantial interest in the company by having 20% or more of the voting power , The
employee whose income under the head salaries (including all the taxable monetary
payments of salary but excluding the value of any non-monetary benefits or perquisites),
after allowing deductions under Section 16, exceeds Rs. 50,000

True/False
Question Deduction u/s 80E for repayment of loan taken for higher education is
available if the loan must have borrowed by the assessee himself or his Father
Your Answer False
True/False
Question The consideration for transfer of Capital Asset is received by the transferor is
not material while Capital gain chargeable to tax.
Correct Answer True
Your Answer True

Question Any loans or deposits borrowed or repaid under section 269SS of the Act
provides that the said provisions will not apply to the loans or deposits accepted by :-
Correct Answer Banking company including cooperative bank and post office savings
bank , Government , Government company
Your Answer Government , Government company , Banking company including
Match The Following

Employee stock option plan ESOPS ESOPS
Uncommuted Pension Indicates the periodical payment of pension Indicates the

periodical payment of pension
Commuted Pension Indicates the lump sum received in lieu of the periodical
Indicates the lump sum received in lieu of the periodical
Treatment of Perquisite Taxed in the hands of employee as taxable salary Taxed in

the hands of employee as taxable salary
True/False
Question A person who is a Senior Citizen who has attained the age of 65 years is not
entitled to the rebate u/s 88 of the Act.
Your Answer True

Correct Answer Within six months from the date of transfer of the long-term capital
asset
Your Answer Within six months from the date of transfer of the long-term capital asset
Select The Blank

Question Unabsorbed business loss can carried forward and set off in the subsequent
Assessment Years subject to the time limit of ________ Assessment years.
Correct Answer 8
Your Answer 3

Question Mr. A whose Gross Total Income, before allowing deductions under Chapter
VI-A is Rs. 2,40,000 wants to make the investments in the following alternative forms
Rs. 50,000 in PPF and Rs. 50,000 in Infrastructure Bonds. The amount of rebate available
to him u/s 88 is :-

Your Answer Exempt
Match The Following

Any subscription made to National Saving Scheme
By an individual or a HUF is eligible for rebate u/s 88 By an individual or a HUF is

on 10th June 2004. His tax liability for the A Y 2005-2006.
RS.12,500 RS.12,500
Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund

Is eligible for rebate u/s 88 Is eligible for rebate u/s 88
Select The Blank

Select The Blank

Question Non resident individual satisfies ________ of the basic conditions.
Correct Answer None
Your Answer Any one

Question Deduction from Capital Gains under Section 54 is for Capital Gains arising
from transfer of :-
Correct Answer House Property
Select The Blank

Question Deduction for remuneration from foreign sources for professors, teachers etc
under Section 80R is limited to ________% of such remuneration brought in India.
Correct Answer 15
Your Answer 15
Select The Blank

Question Relief under section 89 is available to an employee in respect of the amount
of salary received ________.
Correct Answer In advance or in arrears
Your Answer In the immediately succeeding year.
Select The Blank

Question AOP id formed when two or more ________ come together to earn income.
Correct Answer Persons
Your Answer Persons

Question Capital Gains arise on account of excess of transfer consideration over the
following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure incurred
wholly and exclusively in connection with the transfer
Your Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly
and exclusively in connection with the transfer

Question Which of the following amounts credited to P & L Account but not taxable
from Income tax Purposes as Profits from Business and Profession?
True/False
Question Rebates as per the provisions of Section 88 of the Act are not available from
the tax on long-term capital gains.
Correct Answer True
Your Answer True
Select The Blank

Question If assessee owns more than one house properties, he can get benefit of nil
annual value for any one house property ________.

Question What is the treatment of principal amount of loan borrowed for the purchase
or construction of a residential house?

Question The provisions for payment of gratuity is not allowed under section 40A(7)
but, under the head, profits from business and profession, the amount of gratuity will be
allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable to the employees
during the previous year , The provision has been made for the payment of a sum by way
of contribution to an approval gratuity , The other than the above two situations, any
provision made for the payment of gratuity is not allowed as deduction
Your Answer The amount of gratuity has actually become payable to the employees
during the previous year , The provision has been made for the payment of a sum by way
of contribution to an approval gratuity

Question If the Salary is less than Rs. 5,00,000, Standard Deduction will be the least of
the following :-
Correct Answer 40% of the Salary , Rs. 30,000
Your Answer 40% of the Salary , Rs. 30,000

Question The amount of advance tax payable by non corporate assessees before 15th
December of Previous year is :-
Select The Blank

Question It should be noted that the tax liability of an individual having the total
income of less than Rs ________ is Nil u/s 88D.
True/False
Question If assessee owns more than one house properties, annual value of any one of
the house property can be treated as nil, and such option can be changed year on year
basis.
Correct Answer True
Your Answer True
True/False
Your Answer False

Question Following persons are deemed to be an assessee :-
Correct Answer Legal heir of deceased person , Parents of minor assessee , Agent of
NRI
Your Answer Legal heir of deceased person , Parents of minor assessee , Agent of NRI

Select The Blank

Question The rebate u/s 88B is available to an individual who has attained the age of
________ or more at any time during the previous year.
Correct Answer 65
Your Answer 65

Question What is the tax treatment of the Lump sum received from unrecognized
Correct Answer Employee's contribution to PF is exempt from tax , Interest on
employee's contribution is taxable as "Income from Other Sources" , Employer's
Your Answer Employee's contribution to PF is exempt from tax , Interest on
True/False
Question Any advance tax paid before 31st March is treated as advance tax paid during
the previous year.
Correct Answer True
Your Answer True
True/False
Question A woman assessee below the age of 65 years is also entitled to rebate u/s 88.
Correct Answer True
Your Answer True

Question Rent for other amenities like lift, electricity, telephone etc. is taxed under the
heading :-
Correct Answer Income from other sources

June of Previous year is :-
Correct Answer Nil

Allowance received.
Your Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment Allowance
received.
True/False
Question Loss from house property can be adjusted against the income from any other
house property.
Correct Answer True
Your Answer True
True/False
Question Annual premium paid by the employer for the accident insurance policy
taken by the employer in the name of the employee is chargeable to tax.
Your Answer True

Question Annual return for TDS from Salaries is to be filed in :-
Select The Blank

Question Monetory Limit for deduction for royalty income of authors under Section
80QQB is Rs.________.
Your Answer 300000

Question Income from winning from lotteries / crossword puzzles/ horse races is
taxed at flat rate of :-
Correct Answer 0.3
Your Answer 0.3


Question Mediclaim premium u/s Section 80D should be paid by
Correct Answer Cheque
Your Answer Cheque or Cash
True/False
Question Any sum payable by the assessee by way of tax, duty, cess or fee is
allowed as deduction even though they are not actually paid.
Your Answer True
True/False
Correct Answer True
Your Answer True

Question What is the tax treatment of Statutory Provident Fund?
Correct Answer Employer's Contribution to PF is not liable for any tax payment ,
Interest credited to the employee's account is not liable for any tax payment. , The lump
sum received at the time of retirement or resignation or death is also exempt under
section 10(11) and 10(12).
Your Answer Employer's Contribution to PF is not liable for any tax payment ,
Interest credited to the employee's account is not liable for any tax payment. , The lump
sum received at the time of retirement or resignation or death is also exempt under
section 10(11) and 10(12).
Select The Blank

Question The aggregate amount of all the expenditure falling under the head
preliminary expenses incurred under section 3________, for an Indian company the
aggregate of all the expenditure can be 5% of the cost of project or 5% of capital
employed whichever is higher.
Correct Answer 5% of the cost of project or 5% of capital employed
Your Answer 5% of the cost of project or 7% of capital employed



Question Rates of income tax are prescribed by :-
Correct Answer The Finance Act
Your Answer Ordinance
Select The Blank

Question If assessee owns more than one house properties, he can get benefit of nil
annual value for any one house property ________.
Your Answer House which is first purchased


Question Choose capital expenditure from the following list :-
Your Answer Purchase of Building , Construction of temporary structures ,
Purchase of machinery

Question Rebate is allowed on any subscription made to National Saving Scheme
by :-
Your Answer An individual , A HUF

2001 then :-
True/False
Question Loss under the head Profits from Business or Profession can be adjusted
against the Income from Salaries.
Your Answer False

Question The amount paid by the employer to the employee on his retirement is
taxed as :-
Correct Answer Income from Salaries
Your Answer Income from Salaries
Select The Blank

Correct Answer 182
Your Answer 182
True/False
Question Bad Debts recovered not allowed as deduction in earlier years is not
taxable in any year.
Correct Answer True
Your Answer False

Your Answer Long term Capital Gains , Short Term Capital Gains.

Question The amount of advance tax payable by non corporate assessees before

Question An assessee can claim deduction under section 35 in relation to the
expenditure incurred on scientific research in the field of natural gas or applied sciences
if :-
Correct Answer Any revenue expenses incurred by the assessee for carrying out the
scientific research provided that such research is related to his business , Any capital
expenses incurred by the assesse himself for carrying out the scientific research provided
that such research is related to his business , The assesse is a company engaged in the
business of bio-technology or any other notified product a weighted deduction of 150% is
allowed in respect of in-house research and development expensed, till 31st March, 2005
Your Answer Any revenue expenses incurred by the assessee for carrying out the
scientific research provided that such research is related to his business , The assesse is a
company engaged in the business of bio-technology or any other notified product a
weighted deduction of 150% is allowed in respect of in-house research and development
expensed, till 31st March, 2005
Select The Blank

Question Registration charges in connection with the increasing of ________ share
capital of the company is not allowed as revenue expenditure.
Your Answer Issued
True/False
Question If a person is required to quote the PAN and he quotes or intimates a false
number then he may be liable to pay a penalty of Rs. 25000.
Your Answer False

Question What is the tax treatment of the Lump sum received from unrecognized
Correct Answer Employee's contribution to PF is exempt from tax , Interest on
employee's contribution is taxable as "Income from Other Sources"
Select The Blank

Question If the person responsible for deducting the tax at source and paying the
same to the credit of Central Government has not been allotted the Tax Deduction
Account Number (TAN), he shall within ________ from the end of the month in which
the tax was deducted, apply for the allotment of TAN Number.
Correct Answer One month
Your Answer Fifteen days
Match The Following

Deduction in case of permanent physical disability Section 80U Section 80U
Deductions for Donations Paid Section 80G Section 80G
Deduction in respect of Interest on Bank Deposits Section 80L Section 80L
True/False
Question If the capital asset becomes the property of the assessee by virtue of gift or
will, the period for which the capital asset is held by the previous owner should be
excluded while deciding the holding period.
Your Answer True
True/False
Question Amount paid by the employer in respect of any leave standing to the credit
of the employee after the date of furnishing return of income, this sum was payable in the
previous year is allowed as deduction.
Your Answer False
Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of various
payments are allowed as deductions only if they are actually paid but, where if the
assessee follows the ________, the payments can be claimed on due basis.
Correct Answer Mercantile system of accounting
Your Answer Cash system of accounting
True/False
Question A woman assessee below the age of 65 years is also entitled to rebate u/s
88.
Correct Answer True
Your Answer True

Question Income received by following assesses is taxable in India :-
Correct Answer Resident , Non resident , Resident but not ordinary resident
Your Answer Resident , Resident but not ordinary resident

Question Any premium paid by the assessee by Cheque as an employer to effect or
keep in force an insurance on the health of his employees is :-
Correct Answer Allowed as expenses while calculating profits from business and
profession
Your Answer Is allowed as a deduction under Section 80G
Select The Blank


Question Assessee gets deduction of interest paid on borrowed capital even if he :-
Correct Answer Takes possession later on , Acquires later on
Your Answer Takes possession later on , Acquires later on
Match The Following

Perquisites Indicate benefits or amenities provided by the employer to the employee,

either free of cost or at the concessional rate Indicate benefits or amenities provided by
the employer to the employee, either free of cost or at the concessional rate
House Rent Allowance This indicates the amount paid by the employer to the
employee to meet the expenditure for residential accommodation occupied by the
employee This indicates the amount paid by the employer to the employee to meet
the expenditure for residential accommodation occupied by the employee
Retrenchment Compensation Compensation received by a worker at the time of

retrenchment Compensation received by a worker at the time of retrenchment
Traveling Allowance Any allowance granted to meet the cost of travel on tour or on
transfer of duty. Any allowance granted to meet the cost of travel on tour or on
transfer of duty.
Select The Blank

Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax
rebate of ________u/s 88C of the IT Act.


Question If notified news agency distributes its income amongst its members then :-
Correct Answer Whole of its income will be taxable
Your Answer It will have to pay tax on distributed profits

Question Deduction in respect of Contribution to certain pension funds u/s 80CCC
is available to :-
Correct Answer Individuals
Your Answer Individuals
True/False
Your Answer False

Question In case of Payment of Interest on Securities no tax is required to be
deducted under the following circumstances :-
Correct Answer If the debentures are issued by a widely held company and the
debentures are listed on a stock exchange and if the amount of interest does not exceed
Rs. 2,500 during the financial year. , If the interest paid is on State or Central
Government Securities, If the debentures are issued by an institution, authority, Public
Sector Company or cooperative society as the Central Government may notify.
Your Answer If the interest paid is on State or Central Government Securities , If
the debentures are issued by a widely held company and the debentures are listed on a
stock exchange and if the amount of interest does not exceed Rs.5,000 during the
financial year.
Select The Blank

Question Expenditure incurred by an assessee on advertisement in any brochure,
tract, pamphlet or like published by a ________shall not be allowed as business
expenditure.
Correct Answer Political party
Your Answer Company

Question Foreign allowance received by an Indian national is exempt if it is
paid by :-
Correct Government of India
Answer
Your Government of India
Answer

Question For the purpose of section 80IA, the term eligible business means
:-
Correct Developing, maintaining or operating any infrastructure facility
Answer where the term infrastructure facility means a road (including a toll
road, a bridge or a rail system) or a highway project or a water
supply project. , Developing, maintaining or operating an
industrial park or special economic zones notified by the Central
Your Developing, maintaining or operating an industrial park or special
Answer economic zones notified by the Central Government , Generation
or distribution of power , Developing, maintaining or operating any
infrastructure facility where the term infrastructure facility means a
road (including a toll road, a bridge or a rail system) or a highway
project or a water supply project.
True/False
Correct False
Answer
Your False
Answer

Question The due date prescribed for filing the returns of income in Form
No. 2C is
Correct 31st October of the respective Assessment year
Answer
Your 31st October of the respective Assessment year
Answer

Question The amount of accumulated interest on NSCs purchased in the
earlier years is assumed to be reinvested :-
Correct And qualifies for tax rebate under section 88.
Answer
Your And qualifies for tax rebate under section 88.
Answer
True/False
Question A person who is a Senior Citizen who has attained the age of 65
years is not entitled to the rebate u/s 88 of the Act.
Correct False
Answer
Your False
Answer

Question The total amount of rebates under Section 88, Section 88B,
Section 88C and Section 88D of the Act. shall :-
Correct Not exceed the amount of tax calculated on the total income.
Answer
Your Not exceed the amount of tax calculated on the total income.
Answer
True/False
Question A company is resident of India if in any previous year it is an
Indian Company even though control & management are situated
outside India.
Correct False
Answer
Your False
Answer

Question From GTI of a company following deductions under chapter VI A
are allowed
Correct 80 G Donations , 80 HHB profits and gains from projects outside
Answer India , 80 IA profits and gains of infrastructure companies
Your 80 G Donations , 80 HHB profits and gains from projects outside
Answer India , 80 IA profits and gains of infrastructure companies
True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of
the company carried out, the report of such audit should be
enclosed to the Tax Audit Report.
Correct True
Answer
Your True
Answer
Match The Following
Deductions of Rent, Rates, Repairs, Taxes and Insurance on u/s u/s

Buildings are available 30 30
General deductions are allowed as deductions while calculating u/s u/s

profits from business and profession 37 37
Deductions of Repairs & maintenance of machinery, plant & u/s u/s

furniture are available 31 31

Question In case of any contribution made by an individual or a HUF to
notified units of any approved mutual fund or of Unit Trust of India
in accordance with a notified scheme (Equity Linked Savings
Scheme) :-
Correct The maximum allowable limit is Rs. 10,000
Answer
Your The maximum allowable limit is Rs. 10,000
Answer
True/False
Question The value of benefit resulting from the payment made by the
employer in a club for any expenditure incurred by the employee
shall be taken as perquisites unless the said expenses are
incurred wholly and exclusively for official purposes.
Correct True
Answer
Your True
Answer

Correct Rebate u/s 88 for such amount not exceeding Rs. 20,000
Answer
Your Rebate u/s 88 for such amount not exceeding Rs. 20,000
Answer
True/False
Question Rebates as per the provisions of Section 88 of the Act are not
available from the tax on longterm capital gains.
Correct True
Answer
Your True
Answer

Question Following specific incomes are taxable under the heading income
from other sources :-
Correct Winning from betting , Interest on securities of local authority ,
Answer Bonus from key man insurance policy
Your Winning from betting , Interest on securities of local authority
Answer
True/False
Question Deductions available as per the provisions of Chapter VI of the
Act are not available for the long-term capital gains.
Correct True
Answer
Your True
Answer
True/False
Question Income earned & received outside India & remitted to India is
taxable for resident & ordinary resident
Correct True
Answer
Your True
Answer

Question What is the due date for filing Annual return for TDS from
Salaries?
Correct 30th June of Assessment Year
Answer
Your 30th June of Assessment Year
Answer

Question The least of the following is the exemption available to an
employee if he is in receipt of house rent allowance :-
Correct 50% of the Salary where such accommodation is situated in
Answer Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary when
the accommodation is situated at any other place. , Actual
amount of HRA received by the employee. , Excess of rent paid
over 10% of the Salary.
Your 50% of the Salary where such accommodation is situated in
Answer Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary when
the accommodation is situated at any other place. , Actual
amount of HRA received by the employee.
Select The Blank

Question If the CC of the engine is more than 1..6 liters and the motor car
is owned or hired by the employer and is used partly of official
and partly for personal purposes and if running and maintenance
expenses are borne by the employee then the value of perquisite
will be Rs.________ per month plus Rs.600 if car is chauffer
driven car.
Correct 600
Answer
Your 600
Answer

Question As a general principle, the Basic Salary or Wages, Dearness
Correct Fully taxable.
Answer
Your Fully taxable.
Answer

Auditor is required to give the accounting calculation in ratios of :-
Correct Gross profit/turnover , Net profit/turnover , Stock in trade/turnover
Answer
Your Gross profit/turnover , Net profit/turnover , Stock in trade/turnover
Answer

Question If taxable income is less than 7.5% of book profit, income tax is
payable @ of :-
Correct 0.1
Answer
Your 0.1
Answer
Select The Blank

Correct 0.35
Answer
Your 0.2
Answer
True/False
Question Interest is payable by the assessee for not paying the Advance
tax or if the Advance tax paid by the assessee is less than 80% of
the Assessed tax after adjusting the amount of TDS and Advance
tax Paid
Correct False
Answer
Your True
Answer

Question For the purpose of income tax, the perquisites can be classified
into :-
Correct Perquisites which are taxable in case of all types of employees ,
Answer Perquisites which are taxable only in the hands of specified
employee
Your Perquisites which are taxable in case of all types of employees ,
Answer Perquisites which are taxable only in the hands of specified
employee

Question Loss from owning and maintaining race horses can be adjusted
against :-
Correct Only the income arising out of the same activity
Answer
Your Only the income arising out of the same activity
Answer

Correct Municipal valuation
Answer
Your Municipal valuation
Answer
True/False
Correct False
Answer
Your False
Answer
Select The Blank

Correct Indian
Answer
Your Domestic Company
Answer

Question Section 35D applies to the preliminary expenses incurred by a
company, which consists of :-
Correct Expenditure in connection with the preparation of
Answer feasibility/project report, engineering services, or conducting
market survey , Legal charges and fees for registering the
company as per the provisions of company Act, 1956 , Charges in
connection with drafting and printing of memorandum of
association and Articles of Association
Your Expenditure in connection with the preparation of
Answer feasibility/project report, engineering services, or conducting
market survey , Legal charges and fees for registering the
company as per the provisions of company Act, 1956 , Charges in
connection with drafting and printing of memorandum of

Question Perquisites which are taxable only in the hands of specified
employee include the following categories of perquisites :-
Correct Motor Car , Services of sweeper, gardener, watchman or
Answer personal attendant , Gas, electricity and water provided for
personal consumption
Your Motor Car , Gas, electricity and water provided for personal
Answer consumption , Amount spent on training of employees or fees
paid for refresher management course
Select The Blank

Question Loss under the head Income from Capital Gains, to the extent it is
long term capital loss can be carried forward and set off in the
subsequent Assessment Years against the ________ subject to
the limit of 8 Assessment years.
Correct Long term Capital Gains
Answer
Your Long term Capital Gains
Answer

Correct There needs to be an employer-employee relationship between
Answer the payer and the payee.
Your There needs to be an employer-employee relationship between
Answer the payer and the payee.
True/False
Question The amount of telephone bills (including the mobile phone bills) of
the employee reimbursed by the employer is exempt from tax.
Correct True
Answer
Your True
Answer
True/False
Question The amount of expenses including membership fees and annual
fees incurred by the employee on credit card and which are paid
by the employer shall be added as the perquisites unless the said
expenses are incurred wholly and exclusively for official
purposes.
Correct True
Answer
Your True
Answer

Question The amount of advance tax payable by corporate assessees
Correct 45% of advance tax payable
Answer
Your 45% of advance tax payable
Answer
Question As per which provision and section, every person, company or
any other person shall furnish his returns of income in the
prescribed form on or before the specified due date?
Correct Section 139(1)
Answer
Your Section 139(1)
Answer
Select The Blank

Correct Excise duty
Answer
Your Sales tax
Answer

Question The return of income is required to be filed by all the companies,
except those covered under section 25 of the companies
Act,1956 in the :-
Correct Form No. 1
Answer
Your Form No. 1
Answer
Match The Following

Expenditure connection with recovery of a connection with recovery of a
debt which is not a trading debt debt which is not a trading debt
Business Includes trade, commerce, or Includes trade, commerce, or

manufacture or any adventure or manufacture or any adventure or
concern in the nature of trade, concern in the nature of trade,
commerce or manufacture commerce or manufacture

Capital Expenditure incurred by a Expenditure incurred by a
Expenditure company with the issue of company with the issue of
rights shares rights shares

Question The sum total of all the heads of income clubbed together gives
the amount of :-
Correct Gross Total Income
Answer
Your Gross Total Income
Answer
Select The Blank

Correct Normal Tax rates
Answer
Your Normal Tax rates
Answer

Correct Standard deduction , Interest on borrowed capital , Municipal
Answer taxes
Your Standard deduction , Interest on borrowed capital , Municipal
Answer taxes

Correct Individual , Hindu Undivided Family.
Answer
Your Individual , Hindu Undivided Family.
Answer
Taxation-Saroj2
Select The Blank

Question For an individual as a citizen of India who leaves India in the
relevant previous year for the purpose of employment has to be in India for
________ days or more during previous year.
Correct Answer 182

Your Answer 182

Question The due date prescribed for filing the returns of income in Form
No. 2C is


Question As per which provision and section, every person, company or any
other person shall furnish his returns of income in the prescribed form on or
before the specified due date?

Select The Blank

Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can
claim tax rebate of ________u/s 88C of the IT Act.

Your Answer Nil

Question Rebate is allowed on any subscription made to National Saving
Scheme by :-
Question For the purpose of taxability of perquisite a specified employee
means :-
Correct Answer The person who is director of a company , The employee
who has substantial interest in the company by having 20% or more of the
voting power , The employee whose income under the head salaries (including
all the taxable monetary payments of salary but excluding the value of any non-
monetary benefits or perquisites), after allowing deductions under Section 16,
exceeds Rs. 50,000
Your Answer The person who is director of a company , The employee who
has substantial interest in the company by having 20% or more of the voting
power , The employee whose income under the head salaries (including all the
taxable monetary payments of salary but excluding the value of any non-
monetary benefits or perquisites), after allowing deductions under Section 16,
exceeds Rs. 50,000

Question Following professional institutions have their incomes exempt from
tax :-
True/False
Question Deduction u/s 80E for repayment of loan taken for higher
education is available if the loan must have borrowed by the assessee himself
or his Father

Your Answer False
True/False
Correct Answer True

Your Answer True

Question Any loans or deposits borrowed or repaid under section 269SS of
the Act provides that the said provisions will not apply to the loans or deposits
accepted by :-
Correct Answer Banking company including cooperative bank and post

office savings bank , Government , Government company
Your Answer Government , Government company , Banking company

including cooperative bank and post office savings bank
Match The Following

Uncommuted Pension Indicates the periodical payment of pension

Indicates the periodical payment of pension
Commuted Pension Indicates the lump sum received in lieu of the

periodical Indicates the lump sum received in lieu of the periodical
Treatment of Perquisite Taxed in the hands of employee as taxable salary

Taxed in the hands of employee as taxable salary
True/False

Your Answer True

Question For Deduction u/s 54EC from Capital Gains the assessee should
invest the whole or part of the capital gains in the specified assets :-
capital asset
capital asset
Select The Blank
Question Unabsorbed business loss can carried forward and set off in the
subsequent Assessment Years subject to the time limit of ________
Assessment years.
Correct Answer 8
Your Answer 3

Question Mr. A whose Gross Total Income, before allowing deductions
under Chapter VI-A is Rs. 2,40,000 wants to make the investments in the
following alternative forms Rs. 50,000 in PPF and Rs. 50,000 in Infrastructure
Bonds. The amount of rebate available to him u/s 88 is :-


Your Answer Exempt
Match The Following

By an individual or a HUF is eligible for rebate u/s 88 By an individual or a

HUF is eligible for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs.
2,50,000 during the Assessment Year 2005-2006. He invested Rs. 50,000 in the
tax saving bonds of ICICI on 10th June 2004. His tax liability for the A Y
2005-2006.
RS.12,500 RS.12,500
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross
Total Income of Rs. 1,45,000 including the dividend from Indian companies
amounting to Rs. 10,000. She invests Rs. 50,000 in PPF during the said
Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000
Select The Blank

Select The Blank

Correct Answer None
Your Answer Any one

Question Deduction from Capital Gains under Section 54 is for Capital
Gains arising from transfer of :-
Select The Blank

Question Deduction for remuneration from foreign sources for professors,
teachers etc under Section 80R is limited to ________% of such remuneration
brought in India.
Correct Answer 15
Your Answer 15
Select The Blank

Question Relief under section 89 is available to an employee in respect of the
amount of salary received ________.
Select The Blank

Question AOP id formed when two or more ________ come together to earn
income.
Your Answer Persons

Question Capital Gains arise on account of excess of transfer consideration
over the following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure
incurred wholly and exclusively in connection with the transfer
Your Answer Cost of acquisition , Cost of improvement , Expenditure

incurred wholly and exclusively in connection with the transfer

Question Which of the following amounts credited to P & L Account but not
taxable from Income tax Purposes as Profits from Business and Profession?

True/False
available from the tax on long-term capital gains.
Correct Answer True

Your Answer True
Select The Blank

Question If assessee owns more than one house properties, he can get benefit
of nil annual value for any one house property ________.



Question The provisions for payment of gratuity is not allowed under section
40A(7) but, under the head, profits from business and profession, the amount of
gratuity will be allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable to the
employees during the previous year , The provision has been made for the
payment of a sum by way of contribution to an approval gratuity , The other
than the above two situations, any provision made for the payment of gratuity is
not allowed as deduction
Your Answer The amount of gratuity has actually become payable to the
employees during the previous year , The provision has been made for the
payment of a sum by way of contribution to an approval gratuity

Question If the Salary is less than Rs. 5,00,000, Standard Deduction will be
the least of the following :-

before 15th December of Previous year is :-
Select The Blank

Question It should be noted that the tax liability of an individual having the
total income of less than Rs ________ is Nil u/s 88D.

True/False
Question If assessee owns more than one house properties, annual value of
any one of the house property can be treated as nil, and such option can be
changed year on year basis.
Correct Answer True

Your Answer True
True/False
Your Answer False

Correct Answer Legal heir of deceased person , Parents of minor assessee ,
Agent of NRI
Your Answer Legal heir of deceased person , Parents of minor assessee ,
Agent of NRI

Correct Answer They apply their income for collection & distribution of
news
Select The Blank

Question The rebate u/s 88B is available to an individual who has attained
the age of ________ or more at any time during the previous year.
Correct Answer 65
Your Answer 65

Question What is the tax treatment of the Lump sum received from
unrecognized provident fund on the retirement or resignation or death of the
employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest

on employee's contribution is taxable as "Income from Other Sources" ,
salaries"

employee's contribution is taxable as "Income from Other Sources" ,
salaries"
True/False
Question Any advance tax paid before 31st March is treated as advance tax
paid during the previous year.
Correct Answer True
Your Answer True
True/False
Question A woman assessee below the age of 65 years is also entitled to
rebate u/s 88.
Correct Answer True
Your Answer True

Question Rent for other amenities like lift, electricity, telephone etc. is taxed
under the heading :-

before 15th June of Previous year is :-
Correct Answer Nil

Question The entertainment allowance received by the Government
employees is included in their salaries and the deduction is allowed to the
extent of least of the following amounts :-

Allowance received.
Allowance received.
True/False
Question Loss from house property can be adjusted against the income from
any other house property.
Correct Answer True
Your Answer True
True/False
Question Annual premium paid by the employer for the accident insurance
policy taken by the employer in the name of the employee is chargeable to tax.

Your Answer True

Select The Blank

Question Monetory Limit for deduction for royalty income of authors under
Section 80QQB is Rs.________.
Correct 300000
Answer
Your 300000
Answer

Question Income from winning from lotteries / crossword puzzles/ horse
races is taxed at flat rate of :-
Correct 0.3
Answer
Your 0.3
Answer

Correct Assessment year
Answer
Your Assessment year
Answer

Correct Cheque
Answer
Your Cheque or Cash
Answer
True/False
Question Any sum payable by the assessee by way of tax, duty, cess or fee
is allowed as deduction even though they are not actually paid.
Correct False
Answer
Your True
Answer
True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets
includes both tangible as well as intangible assets.
Correct True
Answer
Your True
Answer

Correct Employer's Contribution to PF is not liable for any tax payment ,
Answer Interest credited to the employee's account is not liable for any
tax payment. , The lump sum received at the time of retirement or
resignation or death is also exempt under section 10(11) and
10(12).
Your Employer's Contribution to PF is not liable for any tax payment ,
Answer Interest credited to the employee's account is not liable for any
tax payment. , The lump sum received at the time of retirement or
resignation or death is also exempt under section 10(11) and
10(12).
Select The Blank

Question The aggregate amount of all the expenditure falling under the
head preliminary expenses incurred under section 3________, for
an Indian company the aggregate of all the expenditure can be
5% of the cost of project or 5% of capital employed whichever is
higher.
Correct 5% of the cost of project or 5% of capital employed
Answer
Your 5% of the cost of project or 7% of capital employed
Answer

Correct Gross total income
Answer
Your Gross total income
Answer

Correct 31st March
Answer
Your 31st March
Answer

Correct The Finance Act
Answer
Your Ordinance
Answer
Select The Blank

Question If assessee owns more than one house properties, he can get
benefit of nil annual value for any one house property ________.
Correct As per his choice
Answer
Your House which is first purchased
Answer

Correct Residential status
Answer
Your Gross total income
Answer

Correct Purchase of Building , Purchase of machinery
Answer
Your Purchase of Building , Construction of temporary structures ,
Answer Purchase of machinery

Question Rebate is allowed on any subscription made to National Saving
Scheme by :-
Correct An individual , A HUF
Answer
Your An individual , A HUF
Answer

Question In respect of leave travel concession If Mr. A has availed the
exemption only once or has not availed any exemption at all, in
the block of four years i.e. 1998-2001 then :-
Correct He can carry over the exemption to the next block of four years
Answer i.e. 2002-2005 provided that he avails the exemption of LTC in
the first calendar year of the next block i.e. 2002.
Your He can carry over the exemption to the next block of four years
Answer i.e. 2002-2005 provided that he avails the exemption of LTC in
True/False
Question Loss under the head Profits from Business or Profession can be
adjusted against the Income from Salaries.
Correct False
Answer
Your False
Answer

Question The amount paid by the employer to the employee on his
retirement is taxed as :-
Correct Income from Salaries
Answer
Your Income from Salaries
Answer
Select The Blank

relevant previous year for the purpose of employment has to be in
India for ________ days or more during previous year.
Correct 182
Answer
Your 182
Answer
True/False
Question Bad Debts recovered not allowed as deduction in earlier years is
not taxable in any year.
Correct True
Answer
Your False
Answer

Correct Short Term Capital Gains. , Long term Capital Gains
Answer
Your Long term Capital Gains , Short Term Capital Gains.
Answer

before 15th March of Previous year is :-
Correct 100% of advance tax payable
Answer
Your 100% of advance tax payable
Answer

Question An assessee can claim deduction under section 35 in relation to
the expenditure incurred on scientific research in the field of
natural gas or applied sciences if :-
Correct Any revenue expenses incurred by the assessee for carrying out
Answer the scientific research provided that such research is related to
his business , Any capital expenses incurred by the assesse
himself for carrying out the scientific research provided that such
research is related to his business , The assesse is a company
engaged in the business of bio-technology or any other notified
product a weighted deduction of 150% is allowed in respect of in-
house research and development expensed, till 31st March, 2005
Your Any revenue expenses incurred by the assessee for carrying out
Answer the scientific research provided that such research is related to
his business , The assesse is a company engaged in the
business of bio-technology or any other notified product a
weighted deduction of 150% is allowed in respect of in-house
research and development expensed, till 31st March, 2005
Select The Blank

Question Registration charges in connection with the increasing of
________ share capital of the company is not allowed as revenue
expenditure.
Correct Authorized
Answer
Your Issued
Answer
True/False
Question If a person is required to quote the PAN and he quotes or
intimates a false number then he may be liable to pay a penalty of
Rs. 25000.
Correct False
Answer
Your False
Answer

Question What is the tax treatment of the Lump sum received from
unrecognized provident fund on the retirement or resignation or
death of the employee?
Correct Employee's contribution to PF is exempt from tax , Interest on
Answer employee's contribution is taxable as "Income from Other
Sources" , Employer's Contribution to PF and interest thereon is
taxable as "Income from salaries"
Your Employee's contribution to PF is exempt from tax , Interest on
Answer employee's contribution is taxable as "Income from Other
Sources"
Select The Blank
Question If the person responsible for deducting the tax at source and
paying the same to the credit of Central Government has not
been allotted the Tax Deduction Account Number (TAN), he shall
within ________ from the end of the month in which the tax was
deducted, apply for the allotment of TAN Number.
Correct One month
Answer
Your Fifteen days
Answer
Match The Following
True/False
Question If the capital asset becomes the property of the assessee by
virtue of gift or will, the period for which the capital asset is held
by the previous owner should be excluded while deciding the
holding period.
Correct False
Answer
Your True
Answer
True/False
Question Amount paid by the employer in respect of any leave standing to
the credit of the employee after the date of furnishing return of
income, this sum was payable in the previous year is allowed as
deduction.
Correct False
Answer
Your False
Answer
Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of
various payments are allowed as deductions only if they are
actually paid but, where if the assessee follows the ________, the
payments can be claimed on due basis.
Correct Mercantile system of accounting
Answer
Your Cash system of accounting
Answer
True/False
Question A woman assessee below the age of 65 years is also entitled to
rebate u/s 88.
Correct True
Answer
Your True
Answer

Correct Resident , Non resident , Resident but not ordinary resident
Answer
Your Resident , Resident but not ordinary resident
Answer

Question Any premium paid by the assessee by Cheque as an employer to
effect or keep in force an insurance on the health of his
employees is :-
Correct Allowed as expenses while calculating profits from business and
Answer profession
Your Is allowed as a deduction under Section 80G
Answer
Select The Blank

Question Where an assessee files or submits the returns as per provisions
of section 139 or in response to the notice under section 142, the
assessment officer undertakes ________ as per section 143(2)
and section 143(3).
Correct Scrutiny Assessment
Answer
Your Scrutiny Assessment
Answer

Question Assessee gets deduction of interest paid on borrowed capital
even if he :-
Correct Takes possession later on , Acquires later on
Answer
Your Takes possession later on , Acquires later on
Answer
Match The Following
Perquisites Indicate benefits or amenities Indicate benefits or amenities

provided by the employer to the provided by the employer to the
employee, either free of cost or employee, either free of cost or
at the concessional rate at the concessional rate
House This indicates the amount paid This indicates the amount paid
Rent by the employer to the employee by the employer to the employee
Allowance to meet the expenditure for to meet the expenditure for
residential accommodation residential accommodation
occupied by the employee occupied by the employee
Retrenchment Compensation received by a Compensation received by a

Compensation worker at the time of worker at the time of
retrenchment retrenchment
Traveling Any allowance granted to meet Any allowance granted to meet

Allowance the cost of travel on tour or on the cost of travel on tour or on
transfer of duty. transfer of duty.
Select The Blank
Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can
claim tax rebate of ________u/s 88C of the IT Act.
Correct Rs. 5,000
Answer
Your Rs. 20,000
Answer

Correct 1st April to 31st March
Answer
Your 1st April to 31st March
Answer

Question If notified news agency distributes its income amongst its
members then :-
Correct Whole of its income will be taxable
Answer
Your It will have to pay tax on distributed profits
Answer

Question Deduction in respect of Contribution to certain pension funds u/s
80CCC is available to :-
Correct Individuals
Answer
Your Individuals
Answer
True/False
Correct False
Answer
Your False
Answer
Question In case of Payment of Interest on Securities no tax is required to
be deducted under the following circumstances :-
Correct If the debentures are issued by a widely held company and the
Answer debentures are listed on a stock exchange and if the amount of
interest does not exceed Rs. 2,500 during the financial year. , If
the interest paid is on State or Central Government Securities , If
the debentures are issued by an institution, authority, Public
Sector Company or cooperative society as the Central
Government may notify.
Your If the interest paid is on State or Central Government Securities ,
Answer If the debentures are issued by a widely held company and the
debentures are listed on a stock exchange and if the amount of
interest does not exceed Rs.5,000 during the financial year.
Select The Blank

Question Expenditure incurred by an assessee on advertisement in any
brochure, tract, pamphlet or like published by a ________shall
not be allowed as business expenditure.
Correct Political party
Answer
Your Company
Answer
1
45. Any loans or deposits borrowed or repaid under section 269SS of the Act provides that the said
provisions will not apply to the loans or deposits accepted by :-
a)
b)
c)
d)
Government
Government company
Banking company including cooperative bank and post office savings bank
Insurance company
2
Marks : 2
49. Any amount paid by an individual as tuition fees to any educational institution in India for the
purpose of full time education of the individual's children. The maximum allowable limit is :-
a)
b)
c)
d)
Rs. 12,000 per child per annum
Subject to the maximum of two children.
Rs.10,000 per child per annum
Subject to the maximum of three children.

3
Marks : 2
50. Combined total of five heads of income equals :-
a)
b)
c)
d)
Gross total income
Gross taxable income
Net income
Tax amount
4

Question The amount of advance tax payable by non corporate assessees before 15th December
of Previous year is :-
Select The Blank

Question The aggregate amount of all the expenditure falling under the head preliminary expenses
incurred under section 3________, for an Indian company the aggregate of all the expenditure can be 5% of
the cost of project or 5% of capital employed whichever is higher.

Question Condition for deduction from Capital Gains arising from transfer of House property under
Section 54 is :-
Correct Answer Assessee must have purchased another residential property one year before or
within two years after the date on which transfer took place , Assessee must have constructed another
residential property within, three years after the date on which the transfer took place.
Your Answer Assessee must have purchased another residential property one year before or within two
years after the date on which transfer took place , Assessee must have constructed another residential
property within, three years after the date on which the transfer took place.
True/False
Question Rebates as per the provisions of Section 88B of the Act are not available from the tax on
long-term capital gains.
5
Your Answer True

Question Profits earned by an Industrial Undertaking engaged in other than infrastructure
Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or place of pilgrimage ,
Company engaged in scientific and industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural area or place of pilgrimage ,
Select The Blank

Question If a person, other than an individual or a HUF, is responsible to pay the rent to any person
in excess of ________ during the financial year.
Correct Answer Rs. 1,20,000
Your Answer Rs. 1,00,000

Question The entertainment allowance received by the Government employees is included in their
salaries and the deduction is allowed to the extent of least of the following amounts :-
Correct Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment Allowance received.
Your Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment Allowance received.
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires company engaged in production,
mining, and manufacturing activities should maintain proper books of accounts showing the particulars of
utilization of material, labour or any other item.
Correct Answer Section 209 of the Companies Act,1956
Your Answer Section 209 of the Companies Act,1956

Question Under the clause No-32 of the Act, in the Tax Audit Report, the Auditor is required to give
the accounting calculation in ratios of :-

Question The losses incurred in the current Assessment Year :-
Correct Answer Can be carried forward to the subsequent Assessment Years
Your Answer Can be carried forward to the subsequent Assessment Years

Question Standard deduction takes care of :-
Correct Answer Ground rent , Repairs & maintenance , Insurance premium
Your Answer Repairs & maintenance , Insurance premium , Ground rent
6
True/False
Question Loss under the head Profits from Business or Profession can be adjusted against the
Income from Salaries.
Your Answer False

True/False
Question If assessee owns more than one house properties, for his self occupation, annual value of
any one of the house property of his own choice is treated as nil & another house as rented out.
Correct Answer True
Your Answer True

Question The specified assets for the purpose of claiming exemption from Capital Gains u/s 54EC
mean the bonds redeemable after 3 years issued by the following institutions
Correct Answer National Bank for Agriculture and Rural Development (NABARD) , Rural
Electrification Corporation Limited , Small Industries Development Bank of India
Your Answer National Bank for Agriculture and Rural Development (NABARD) , Rural Electrification
Corporation Limited , Small Industries Development Bank of India
Select The Blank

Correct Answer 0.35
Your Answer 0.3

Question Which of the following expenses should be debited to P & L Account, but disallowed for
Income tax purpose?
True/False
Question Any Employer's Contribution payable by the assessee towards any provident fund or
superannuation fund or gratuity fund or any other fund for the welfare of the employees, if they are actually
paid, allowed as deduction.
Correct Answer True
Your Answer True
7

Question Maximum Deduction u/s 80D in respect of medical insurance premium for a person who is
a Senior Citizen is Rupees :-
Your Answer 15000
Select The Blank

Question The rate of TDS is ________ in case of advertising work.
Correct Answer 0.01
Your Answer 0.01

Your Answer Accounting year
Select The Blank

Question The rebate u/s 88B is available to an individual who has attained the age of ________ or
more at any time during the previous year.
Correct Answer 65
Your Answer 65
Select The Blank

Question Unabsorbed business loss can carried forward and set off in the subsequent Assessment
Years subject to the time limit of ________ Assessment years.
Correct Answer 8
Your Answer 8


Question Gross Annual Value can not exceed :-
Correct Answer Standard rent
Your Answer Standard rent
True/False
Your Answer True
8
True/False
Question Sales tax and expenses in connection with the proceedings for the assessment of sales
tax are allowed as business expenditure.
Correct Answer True
Your Answer True
Match The Following

Perquisites Indicate benefits or amenities provided by the employer to the employee, either free of
cost or at the concessional rate Indicate benefits or amenities provided by the employer to the
employee, either free of cost or at the concessional rate
House Rent Allowance This indicates the amount paid by the employer to the employee to meet the
expenditure for residential accommodation occupied by the employee This indicates the amount paid by
the employer to the employee to meet the expenditure for residential accommodation occupied by the
employee
Retrenchment Compensation Compensation received by a worker at the time of retrenchment

Compensation received by a worker at the time of retrenchment
Traveling Allowance Any allowance granted to meet the cost of travel on tour or on transfer of duty.
assistance received or due to an assessee from his employer, for himself and his family for
proceeding on leave to any place in India or to any place in India after the retirement or termination of his
service

Question Foreign allowance received by an Indian national is exempt if it is paid by :-
Your Answer Foreign government

Question Following news agencies are specified by the Central Government as specified news
agencies :-
Correct Answer PTI , UNI
Your Answer PTI , P TV , NDTV

Your Answer Reduced from income from house property
True/False
9
Question Income tax paid is allowed as deduction while calculating profit from business or
profession.
Your Answer True

Question Section 35CCA of the Act applies to any expenditure incurred by the assessee by way of
payment of any sum to :-
Correct Answer The National Fund for rural development set up by the central government , Any
association or institution used for carrying out any programs of rural development , The National Urban
Poverty eradication fund set up by the central government
Your Answer The National Fund for rural development set up by the central government , Any
Select The Blank

Question No tax is required to be deducted if the amount paid or credited in pursuance of any
contract does not exceed a certain amount. However, if the aggregate of such amounts paid or credited to a
payee exceeds ________ the tax is required to be deducted under this Section.
Correct Answer Rs. 50000
Your Answer Rs.100000

Question Income from winning from lotteries / crossword puzzles/ horse races is taxed at flat rate of
:-
Correct Answer 0.3
Your Answer 0.3

Question The provisions regarding set off and carry forward of loses are contained in :-
Select The Blank


Question Any premium paid by the assessee by Cheque as an employer to effect or keep in force
an insurance on the health of his employees is :-
Correct Answer Allowed as expenses while calculating profits from business and profession
Your Answer Allowed as expenses while calculating profits from business and profession
10
True/False
Question Rebates as per the provisions of Section 88 of the Act are not available from the tax on
Correct Answer True
Your Answer False
True/False
Question Jewellery held by the assessee is not a Capital Asset.
Your Answer False

Question To get deduction of Rs 150000/- as interest on borrowed capital assessee needs to
satisfy conditions i.e. :-
Your Answer Deduction can be for principal portion also , Borrowal is after 1st April 1999 , Construction
is completed in 3 years

Question The return of income required to be filed in the form by the Non-Corporate Assessee not
claiming the exemption under the provisions of section 11 of the Act and not having income from business
and profession is :-
Correct Answer Form No. 3 or 2D(saral)
Your Answer Form No. 2 or 2D(saral)

Question Salary paid by any partnership firm to its working partners is taxable as :-
Correct Answer Income from Business and Profession
Your Answer Income from Business and Profession
True/False
Question The payments made u/s 43B of the Income Tax Act are allowed as deductions only if they
are actually paid.
Correct Answer True
Your Answer True
Match The Following

Containers made of glass or plastic used as refills Rate of depreciation is 40% Rate of
depreciation is 40%
All intangible assets like Patents, Trademarks, Copy Rights, Licenses etc. Rate of depreciation is
25% Rate of depreciation is 25%
11
Select The Blank

Question Deduction for remuneration from foreign sources for professors, teachers etc under
Section 80R is limited to ________% of such remuneration brought in India.
Correct Answer 15
Your Answer 15
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the form of computers an
electronic items, the wear and tear will be calculated @ ________ %.
Correct Answer 50
Your Answer 20
12
Score Card
1)
Disallowable Expenditure Litigation Expenses in connection with recovery of a debt which is not a
trading debt
Business Includes trade, commerce, or manufacture or any adventure or concern in the
nature of trade, commerce or manufacture
Profession Includes vocation
2)
Any subscription made to National Saving Scheme By an individual or a HUF is eligible for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs. 2,50,000 during the Assessment
Year 2005-2006. He invested Rs. 50,000 in the tax saving bonds of ICICI on 10th June 2004. His tax liability
for the A Y 2005-2006. RS.12,500
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross Total Income of Rs. 1,45,000
including the dividend from Indian companies amounting to Rs. 10,000. She invests Rs. 50,000 in PPF
during the said Assessment Year. her tax liabilit is Rs. 1,000
Any contribution made to a Public Provident Fund Is eligible for rebate u/s 88
3)
In case of Interest free Loans or Loans at concessional rate of interest if the employee pays any amount of
interest to the employer The same shall be reduced from the valuation of perquisites.
Motor Car Perquisites which is taxable only in the hands of specified employee
Services of sweeper, gardener, watchman or personal Perquisites which is taxable only in
the hands of specified employee
The employee who has substantial interest in the company by having 20% or more of the voting power
Specified Employee
13
4)
Deduction in case of permanent physical disability Section 80U
Deductions for Donations Paid Section 80G
Deduction for Rent Paid Section 80G
Deduction in respect of Interest on Bank Deposits Section 80L
5)
Superannuation Fund It is an employee welfare scheme which is usually applicable in case of
very senior employees
Statutory Provident Fund This is set up as per the provisions of Provident Fund Act, 1925. This is
maintained by Government organizations, local authorities, universities and educational
.Recognized Provident Fund the provisions of Employees Provident Fund and Miscellaneous
Provisions Act, 1952 apply to this fund.
Unrecognized Provident Fund The provident fund which is not recognized by the income tax
authorities .
6)
Employee stock option plan ESOPS
Uncommuted Pension Indicates the periodical payment of pension
7)
Disallowable Expenditure Litigation Expenses in connection with recovery of a debt which is not a
trading debt
8)
Deductions of Rent, Rates, Repairs, Taxes and Insurance on Buildings are available u/s 30
Deduction of Depreciation is available u/s 32
General deductions are allowed as deductions while calculating profits from business and profession
u/s 37
Deductions of Repairs & maintenance of machinery, plant & furniture are available u/s 31
9)
cost or at the concessional rate
expenditure for residential accommodation occupied by the employee
14
Total SETS 7
SET 1
Correct Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 , 1/5th of Salary
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method as well as straight
line method for the computation of depreciation u/s 32 this act.

Question Which of the following expenditure is in the nature of revenue expenditure?

Question If sum received is net of TDS then it is ________ to include in income from other sources.
Question Interest paid on the loan for acquiring a capital asset will be considered to be a part of
cost of acquisition.
Correct Answer True
Question Mr. A whose Gross Total Income, before allowing deductions under Chapter VI-A is Rs.
1,45,000, wants to make the investments in the following alternative forms Rs. 80,000 in PPF and Rs.
20,000 in Infrastructure Bonds. The amount of rebate available to him u/s 88 is :-

Question As per section 2(11) of the Income Tax Act, Block of Assets includes both tangible as well
as intangible assets.
Correct Answer True
Question Deductions in respect of Certain Incomes received under Section 80L is available in
respect of
Correct Answer Interest on Central or State Government Securities , Interest on National Saving
Certificates (NSCs) Interest on National Saving Scheme, 1992 (NSS) , Bank Interest

15
Correct Answer Perquisites which are taxable in case of all types of employees , Perquisites
which are taxable only in the hands of specified employee
Question For an individual as a citizen of India who leaves India in the relevant previous year for the
purpose of employment has to be in India for ________ days or more during previous year.
Correct Answer 182

Question ________ of the Tax Audit Report refers to the details of various payments which are
allowed as deduction only if they are actually paid for.




Question If an employee does not avail of this leave travel concession or assistance during a block
of four calendar years :-
Question Deduction from Capital Gains under Section 54F is for Capital Gains arising from transfer
of :-
Question Where an assessee files or submits the returns as per provisions of section 139 or in
response to the notice under section 142, the assessment officer undertakes ________ as per section
143(2) and section 143(3).

16
Question While computing the profits from Business and profession, the business or profession
must be carried out during the previous year.
Correct Answer True
Question In respect of leave travel concession If Mr. A has availed the exemption only once or has
not availed any exemption at all, in the block of four years i.e. 1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of four years i.e. 2002-2005
provided that he avails the exemption of LTC in the first calendar year of the next block i.e. 2002.
Question The amount accumulated to the credit of the employee's provident fund account is paid at
the time of :-

Question As a general principle, the Basic Salary or Wages, Dearness Allowance and Bonus /
Commission is :-
Question From GTI of a company following deductions under chapter VI A are allowed
Correct Answer 80 G Donations , 80 HHB profits and gains from projects outside India , 80 IA
profits and gains of infrastructure companies

Question If the Salary is more than Rs. 5,00,000, Standard Deduction will be Rs.________.
Question The amount of accumulated interest on NSCs purchased in the earlier years is assumed
to be reinvested :-
Question Deduction u/s ________B is available for 10 consequent assessment years from the year
of commencement of production.
Correct Answer 10


Question Any recreational facility provided by the employer to a group of employees (not being
restricted to a select few employees) is not exempt from tax.
Question In case of deductions for medical treatment under Section 80DDB the amount of
deduction will be reduced by the amount received under an insurance policy or the amount reimbursed by
the employer.
17
Correct Answer True
Question Any advance tax paid before 31st March is treated as advance tax paid during the
previous year.
Correct Answer True

Question Entertainment Allowance received by the employees from the private sector is taxable in
the hands of the employee.
Correct Answer True

Question For Deduction u/s 54EC from Capital Gains the assessee should invest the whole or part
of the capital gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the long-term capital asset
Correct Answer True
SET 2
Question Expenditure incurred by an assessee on advertisement in any brochure, tract, pamphlet

or like published by a ________shall not be allowed as business expenditure.
Question Which of the following expenditures are expressly disallowed to be deducted while
computing the profits from business and profession
Question Perquisites which are taxable only in the hands of specified employee include the
following categories of perquisites :-
Question The least of the following is the exemption available to an employee if he is in receipt of
house rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata,
Chennai and Delhi and 40% of the Salary when the accommodation is situated at any other place. , Actual
amount of HRA received by the employee. , Excess of rent paid over 10% of the Salary.
Question The Net Annual Value of the house of Mr. X is Rs 75,000 which he has let out for the rent
of Rs 7,000, the statutory deduction under the act will be :-
Question The amount of deduction available depends upon the nature of donation. For this
purpose, the donations may fall under the following categories :-
18
Correct Answer Donations eligible for 100% deduction without any qualifying limit. , Donations
eligible for 50% deduction without any qualifying limit , Donations eligible for 75% deduction subject to
qualifying limit
Question Following incomes of a local authority are taxable :-

Correct Answer Trade or business or service outside its jurisdiction
Question A person who is a Senior Citizen who has attained the age of 65 years is not entitled to
the rebate u/s 88 of the Act.
Question The amount of rebate u/s 88B is 100% of the income tax liability before claiming the
rebate under section 88 and relief under section 89(1) or Rs.________ whichever is less.
Question If the asset sold or transferred by the employer to employee is in the form of computers
Correct Answer 50
Question Relief under section 89 is available to an employee in respect of the amount of salary
received ________.
Question Expenditure incurred in connection with the local festivals like Diwali etc. are ________ as
business expenditure.
Question Deduction is available for income from foreign sources under Section 80RR if such
remuneration brought into India in convertible foreign exchange within a period of________ months from the
end of the previous year.
Correct Answer 6

Question All intangible assets like Patents, Trade Marks, Copy Rights, Licenses etc. have the
depreciation rate of :-
Correct Answer 0.25


Question Which of the following expenditure is in the nature of capital expenditure?

Correct Answer Expenditure in connection with the issue of bonus shares
Question According to the provisions of Section 10(13) of the Act, following payments received from
an Approved Superannuation Fund are exempt from tax :-
19
Correct Answer The amount paid to the employee in lieu of or in commutation of an annuity on
his retirement on or after a specified age or on his becoming incapacitated prior to such retirement , The
amount paid by way of refund of contribution to the legal heirs on the death of the beneficiary.
Correct Answer True

interest in the company by having 20% or more of the voting power , The employee whose income under
the head salaries (including all the taxable monetary payments of salary but excluding the value of any non-
monetary benefits or perquisites), after allowing deductions under Section 16, exceeds Rs. 50,000
Question What is the manner in which Income from Salaries is taxable?

the time of :-

Question Section 2(36) of Income Tax Act indicates that the word "Profession" :-
Correct Answer Will include vocation.
Question Under section 43B of the IT Act certain payments are not allowed as deduction in any of
the previous years but are paid during the current previous year, they will be allowed as deduction during
the current previous year.
Correct Answer True

Question Income from other sources is the ________ head of income.

Correct Answer Residual
Question Expenditure incurred on stamp duty, registration fees, legal expenses on the issue of
debentures by the company is :-
Correct Answer Allowed as revenue expenditure while calculating the profits from business and
profession
Question Section 35D of the Act provides that the preliminary expenses can be ________ over a
period of 5 years commencing from the year of commencement of business.
Question If the debentures are converted into shares, it is considered to be transfer of the capital
asset.
20
Question Section 80QQB is applicable to the individual resident who is an author of text books.
Question Free meals provided by the employer during the office hours provided that the value per
meal does not exceed Rs. ________.
Correct Answer 50
Question Section 44AB of the income tax Act, provides that every person carrying on business has
to get his accounts audited by a Chartered Accountant whose sales turnover or gross receipts :-
Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a company, the term
Correct Answer Any person who carries on a business or profession and in his business the
assessee or any director of such company or relative of such director has substantial interest. , Any director
of the company or his relative , Any person having a substantial interest in the business or profession of the
company or any director or partner of such firm or company or the relative of such person.

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term "Specified
Persons" may include :-
Correct Answer Any partner of the firm or his relative, Any person having the substantial interest
in the business or profession of the firm or any director or partner of such company or firm or any relative of
such person. , Any person who carries on business or profession and in his business or profession the
assessee or any partner of such firm or relative of such partner has substantial interest.
Question Annual value is :-

Correct Answer A notional value
Question Cost of improvement does not include any expenditure which is deductible from any other
head of income.
Correct Answer True
Question Deduction from Capital Gains under Section 54B is for Capital Gains arising from transfer
of :-
Question Any person, who is responsible for paying any amount to a resident contractor for carrying
out any work under a contract, shall deduct the tax @________.
Correct Answer 0.02
Question A company is resident of India if in any previous year it is an Indian Company even
though control & management are situated outside India.
21
Question The various payments which are referred as deductions under section 43B, Clause No-21
are :-
Fund or Superannuation Fund or Gratuity Fund for the welfare of the employees , Any sum payable by the
assessee by way of tax duty, cess or fee , Any sum payable by the assessee as interest on any loan or
borrowing made by him from any public financial institution or state financial corporation as per the terms of
the agreement
Question If house property is used for business purposes, it is taxed under :-

Correct Answer Income from business profession
SET 3
Question Loss under the head Income from Capital Gains, to the extent it is long term capital loss
can be carried forward and set off in the subsequent Assessment Years against the ________ subject to the
limit of 8 Assessment years.
Question Loss from house property can be adjusted against the income from any other house
property.
Correct Answer True

Question Annual premium paid by the employer for the accident insurance policy taken by the
employer in the name of the employee is chargeable to tax.
Question What is the tax treatment of the Lump sum received from unrecognized provident fund on
the retirement or resignation or death of the employee?
contribution is taxable as "Income from Other Sources" , Employer's Contribution to PF and interest thereon
is taxable as "Income from salaries"

Question Income earned & received outside India & remitted to India is taxable for resident &
ordinary resident
Correct Answer True
Question Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34) of
the IT Act.
Question The assessee is required to quote PAN in :-

22
challans for the payment of any amount under the Act , All the documents pertaining to purchase, sale and
bank transactions
Question Any sum received under Keyman Insurance policy, including any amount of bonus is
taxable under the head Income from other sources.
Correct Answer True
Question Capital Gains is chargeable to tax :-

Correct Answer During the previous year in which the Capital Assets is transferred
Question ________ Expenditure should not be allowed as expenditure u/s 37(1) of the Income Tax
Act.
Correct Answer Personal
Question Mr. A had borrowed an amount of Rs. 25,000 from his friend. Out of this amount, he
invested an amount of Rs.10,000 in the PPF account opened in the name of his wife. Which of the following
is true?
Correct Answer Mr. A will not be entitled to any rebate u/s 88
Question Any amount borrowed or repaid on Hundi form under section 69D, Clause N0-23 shall be
deemed to be the income of the person borrowing or repaying the amount for the previous year in which the
amount was borrowed or repaid.
Correct Answer True

Question To assess income from business and profession and income from other sources under
section 145, the assessee may follow either :-
Correct Answer Cash system or Accrual system of accounting
Question A return is considered to be defective returns under section 139(9) unless :-

filed in , The return is accompanied by the tax audit report under section 44AB , The return is accompanied
by copies of required financial statements of the assessee


23
Question Registration charges in connection with the increasing of ________ share capital of the
company are not allowed as revenue expenditure.
Question Any payment which is chargeable under the head "________" payable outside India or to
a non-resident and if the tax has not been thereon or deducted there from.
Correct Answer Salaries
Question Value at which house property is offered for taxation under the head income from house
property is :-
Correct Answer Annual value
Question Deduction from Capital Gains under Section 54EC is for Capital Gains arising from
transfer of :-


Correct Answer Individual, Hindu Undivided Family.
Question In case the assessee is not a company, a person(other than a company) who is falling
under One by Six economic criteria, the last date for filing the return is prescribed as :-
Question If the Salary is less than Rs. 5,00,000, Standard Deduction will be the least of the
following :-
Correct Answer True
Question Deduction is available for ________ income from foreign sources under Section 80RR.
Correct Answer Professional
Question Following is the list of some of the major persons responsible for deducting the tax at
source :-
24
Correct Answer Central or State Government , Any Local Authority , Any Trust
not a Senior Citizen is Rupees :-
Question Prior period interest is calculated from the date of ________ to the date of completion.
Correct Answer Borrowing

Question The amount of advance tax payable by non corporate assessees before 15th September
Correct Answer True
Question For the purpose of Section 40 A (2) of the IT Act, if assessee is an individual, the term
Correct Answer Any relative of such individual, Any person (individual, company, firm etc.) having
a substantial interest in the business or profession of the individual or any director or partner of such
company or firm or any relative of such person. , Any person who carries on a business or profession and in
his business or profession, the assessee himself or his relative has a substantial interest.
Question Domestic companies are required to pay tax @ :-

Correct Answer Tax 35% + SC 2% + EC 2%
Correct Answer 0.02
Question Any expenditure incurred by the assessee for any purpose which is ________ or which is
prohibited by law shall not be allowed as business expenditure

SET 4
Question Assessee gets deduction of interest paid on borrowed capital if it is used for :-
Correct Answer Construction , Purchase , Repair

Correct Answer None
25
Question The purpose of Advance Tax is to ensure the receipt of tax proceeds by the Government
before the assessment year ends on 31st March.
Correct Answer True
Question Deduction u/s 10A is ________ of export proportion of profits.

Correct Answer 0.9
Question Capital Gains arise on account of excess of transfer consideration over the following
amounts
Question If taxable income is less than 7.5% of book profit, income tax is payable @ of :-
Correct Answer 0.1

Question The amount of compensation received or receivable by the employee from the employer
at the time of termination of his employment or at the time of modification of terms and conditions in
connection with the employment is called as ________.
Question Following incomes are deemed to have accrued or arisen in India :-

Correct Answer Salary earned in India even if paid outside India , Salary paid by Government to
Indian national for services rendered outside India , Tax deducted in India
Question If an assessee gets the salary from more than one employer during an Assessment Year,
Salary received from all the employers will be aggregated and then the Standard Deduction will be allowed.
Correct Answer True
Question In case of the individual or HUF whose Gross Total Income, before deductions under
Chapter VI-A, is more than Rs. 5,00,000, then :-

26
Question Mrs. X of 45 years has received salary of Rs 5, 50,000 she can claim tax rebate of
________u/s 88C of the IT Act.
Question The basic requirement of section 37 is that the expenditure should have been incurred by
the assessee ________ for the purpose of business.
Correct Answer Wholly and exclusively

Correct Answer Legal heir of deceased person , Parents of minor assessee , Agent of NRI
Correct Answer True

Question If the CC of the engine is more than 1.6 liters and the motor car is owned or hired by the
employer and is used partly of official and partly for personal purposes and if running and maintenance
expenses are borne by the employee then the value of perquisite will be Rs.________ per month plus
Rs.600 if car is chauffer driven car.
Correct Answer 600

Correct Answer Resident but not ordinary resident , Resident , Non resident
Question It is mandatory for ________ to file a return even if there is loss or the income is nil.
Question The payments for claiming the tax rebate u/s 88 of the IT Act should be made out of the
income chargeable to tax.
Correct Answer True
Question Deduction in respect of Contribution to certain pension funds u/s 80CCC is available to :-
Section 54 is :-
within two years after the date on which transfer took place; Assessee must have constructed another
company is not allowed as revenue expenditure.
27
Question Amount paid by the employer in respect of any leave standing to the credit of the
employee after the date of furnishing return of income, this sum was payable in the previous year is allowed
as deduction.
Question Any amount deposited by an Individual or a HUF in 10 year or 15 year account under the
Post Office Saving Bank (CTD) Rules, 1959. The account can be in the name of :-
Correct Answer The individual himself, A minor of whom he is the guardian.
Question Which of the following amounts credited to P & L Account but not taxable from Income tax
Purposes as Profits from Business and Profession?
Question Following specific incomes are taxable under the heading income from other sources :-
Correct Answer Winning from betting , Interest on securities of local authority , Bonus from key
man insurance policy
Question If the woman assessee has attained the age of 65 years, she is entitled to the rebate u/s
88B and not u/s 88C.
Correct Answer True
Question An assessee can claim deduction under section 35 in relation to the expenditure incurred
on scientific research in the field of natural gas or applied sciences if :-
Correct Answer Any revenue expenses incurred by the assessee for carrying out the scientific
research provided that such research is related to his business , Any capital expenses incurred by the
assesse himself for carrying out the scientific research provided that such research is related to his business
, The assesse is a company engaged in the business of bio-technology or any other notified product a
weighted deduction of 150% is allowed in respect of in-house research and development expensed, till 31st
March, 2005

Question The amount of advance tax payable by corporate assessees before 15th March of
Previous year is :-

Question Rebates as per the provisions of Section 88C of the Act are not available from the tax on
respect of
28

Question Section 35AC of the Act applies to any sum paid by the assessee to a public sector
company or a local authority or an association approved by the national committee for ________ for
carrying out any project in upliftment of public.
Question The amount of advance tax payable by corporate assessees before 15th December of
Previous year is :-
Question If any person fails to get the accounts audited by a Chartered Accountant and fails to
submit the copy of such report under section 44AB, he will be liable to pay the penalty equal to :-
SET 5
Correct Answer 182

Question As per which provision and section, every person, company or any other person shall furnish his
returns of income in the prescribed form on or before the specified due date?
Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax rebate of ________u/s
88C of the IT Act.


Correct Answer The person who is director of a company , The employee who has substantial interest in
the company by having 20% or more of the voting power , The employee whose income under the head
salaries (including all the taxable monetary payments of salary but excluding the value of any non-monetary
benefits or perquisites), after allowing deductions under Section 16, exceeds Rs. 50,000
29
Question Deduction u/s 80E for repayment of loan taken for higher education is available if the loan must
have borrowed by the assessee himself or his Father
Question The consideration for transfer of Capital Asset is received by the transferor is not material while
Capital gain chargeable to tax.
Correct Answer True
Question Any loans or deposits borrowed or repaid under section 269SS of the Act provides that the said
Correct Answer Banking company including cooperative bank and post office savings bank , Government
, Government company
Question A person who is a Senior Citizen who has attained the age of 65 years is not entitled to the
rebate u/s 88 of the Act.
Question For Deduction u/s 54EC from Capital Gains the assessee should invest the whole or part of the
capital gains in the specified assets :-
Question Unabsorbed business loss can carried forward and set off in the subsequent Assessment Years
subject to the time limit of ________ Assessment years.
Correct Answer 8
2,40,000 wants to make the investments in the following alternative forms Rs. 50,000 in PPF and Rs.



Correct Answer None
Question Deduction from Capital Gains under Section 54 is for Capital Gains arising from transfer of :-
Question Deduction for remuneration from foreign sources for professors, teachers etc under Section 80R
is limited to ________% of such remuneration brought in India.
Correct Answer 15
Question Relief under section 89 is available to an employee in respect of the amount of salary received
________.
30
Question Capital Gains arise on account of excess of transfer consideration over the following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly and exclusively in
connection with the transfer
Question Rebates as per the provisions of Section 88 of the Act are not available from the tax on long-
term capital gains.
Correct Answer True
Question If assessee owns more than one house properties, he can get benefit of nil annual value for any
one house property ________.
Question What is the treatment of principal amount of loan borrowed for the purchase or construction of a
residential house?
Question The provisions for payment of gratuity is not allowed under section 40A(7) but, under the head,
profits from business and profession, the amount of gratuity will be allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable to the employees during the
previous year , The provision has been made for the payment of a sum by way of contribution to an
approval gratuity , The other than the above two situations, any provision made for the payment of gratuity is
Question If the Salary is less than Rs. 5,00,000, Standard Deduction will be the least of the following :-
Question The amount of advance tax payable by non corporate assessees before 15th December of
Previous year is :-
Question It should be noted that the tax liability of an individual having the total income of less than Rs
________ is Nil u/s 88D.
Question If assessee owns more than one house properties, annual value of any one of the house
property can be treated as nil, and such option can be changed year on year basis.
Correct Answer True


31

Question The rebate u/s 88B is available to an individual who has attained the age of ________ or more
at any time during the previous year.
Correct Answer 65
Question What is the tax treatment of the Lump sum received from unrecognized provident fund on the
retirement or resignation or death of the employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest on employee's contribution is
taxable as "Income from Other Sources" , Employer's Contribution to PF and interest thereon is taxable as
"Income from salaries"
Question Any advance tax paid before 31st March is treated as advance tax paid during the previous
year.
Correct Answer True
Correct Answer True
Question Rent for other amenities like lift, electricity, telephone etc. is taxed under the heading :-
Question The amount of advance tax payable by non corporate assessees before 15th June of Previous
year is :-
Correct Answer Nil
Question Loss from house property can be adjusted against the income from any other house property.
Correct Answer True
Question Annual premium paid by the employer for the accident insurance policy taken by the employer
in the name of the employee is chargeable to tax.

SET 6
Correct Answer Developing, maintaining or operating any infrastructure facility where the term
infrastructure facility means a road (including a toll road, a bridge or a rail system) or a highway project or a
32
water supply project. , Developing, maintaining or operating an industrial park or special economic zones
notified by the Central Government , Generation or distribution of power

Question The amount of accumulated interest on NSCs purchased in the earlier years is assumed to be
reinvested :-
Question The total amount of rebates under Section 88, Section 88B, Section 88C and Section 88D of the
Act. shall :-
Question A company is resident of India if in any previous year it is an Indian Company even though
control & management are situated 0utside India.
Correct Answer 80 G Donations , 80 HHB profits and gains from projects outside India , 80 IA profits and
gains of infrastructure companies
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the company carried out, the
report of such audit should be enclosed to the Tax Audit Report.
Correct Answer True
Question In case of any contribution made by an individual or a HUF to notified units of any approved
mutual fund or of Unit Trust of India in accordance with a notified scheme (Equity Linked Savings Scheme)
:-
Question The value of benefit resulting from the payment made by the employer in a club for any
expenditure incurred by the employee shall be taken as perquisites unless the said expenses are incurred
wholly and exclusively for official purposes.
Correct Answer True
residential house?
Question Rebates as per the provisions of Section 88 of the Act are not available from the tax on long-term
capital gains.
Correct Answer True
33
Correct Answer Winning from betting , Interest on securities of local authority , Bonus from key man
insurance policy
Question Deductions available as per the provisions of Chapter VI of the Act are not available for the long-
term capital gains.
Correct Answer True
Question Income earned & received outside India & remitted to India is taxable for resident & ordinary
resident
Correct Answer True
Question The least of the following is the exemption available to an employee if he is in receipt of house
rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata, Chennai
and Delhi and 40% of the Salary when the accommodation is situated at any other place. , Actual amount of
HRA received by the employee. , Excess of rent paid over 10% of the Salary.
Question If the CC of the engine is more than 1..6 liters and the motor car is owned or hired by the
Correct Answer 600
Question As a general principle, the Basic Salary or Wages, Dearness Allowance and Bonus / Commission
is :-
Question Under the clause No-32 of the Act, in the Tax Audit Report, the Auditor is required to give the
accounting calculation in ratios of :-
Correct Answer 0.1

Correct Answer 0.35
Question Interest is payable by the assessee for not paying the Advance tax or if the Advance tax paid by
the assessee is less than 80% of the Assessed tax after adjusting the amount of TDS and Advance tax Paid
Correct Answer Perquisites which are taxable in case of all types of employees , Perquisites which are
taxable only in the hands of specified employee
34

Question Dividend received from domestic company to its shareholders is taxable in the hands of the
shareholder.

Question Section 35D applies to the preliminary expenses incurred by a company, which consists of :-
Correct Answer Expenditure in connection with the preparation of feasibility/project report, engineering
services, or conducting market survey , Legal charges and fees for registering the company as per the
provisions of company Act, 1956 , Charges in connection with drafting and printing of memorandum of
Question Perquisites which are taxable only in the hands of specified employee include the following
categories of perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal attendant , Gas,
electricity and water provided for personal consumption
Question Loss under the head Income from Capital Gains, to the extent it is long term capital loss can be
carried forward and set off in the subsequent Assessment Years against the ________ subject to the limit of
8 Assessment years.

Correct Answer There needs to be an employer-employee relationship between the payer and the payee.
Question The amount of telephone bills (including the mobile phone bills) of the employee reimbursed by
the employer is exempt from tax.
Correct Answer True
Question The amount of expenses including membership fees and annual fees incurred by the employee
on credit card and which are paid by the employer shall be added as the perquisites unless the said
expenses are incurred wholly and exclusively for official purposes.
Correct Answer True
Question The amount of advance tax payable by corporate assessees before 15th September of Previous
year is :-

Question The return of income is required to be filed by all the companies, except those covered under
section 25 of the companies Act,1956 in the :-
35
Disallowable Expenditure ;Litigation Expenses in connection with recovery of a debt which is not a trading
debt
Business ;Includes trade, commerce, or manufacture or any adventure or concern in the nature of trade,
commerce or manufacture
Profession ;Includes vocation
Capital Expenditure ;Expenditure incurred by a company with the issue of rights shares
Question The sum total of all the heads of income clubbed together gives the amount of :-



SET 7
Question Monetory Limit for deduction for royalty income of authors under Section 80QQB is
Rs.________.
Question Income from winning from lotteries / crossword puzzles/ horse races is taxed at flat rate of :-
Correct Answer 0.3


Question Any sum payable by the assessee by way of tax, duty, cess or fee is allowed as deduction even
though they are
not actually paid.
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both tangible as well as
intangible assets.
Correct Answer True

Correct Answer Employer's Contribution to PF is not liable for any tax payment , Interest credited to the
employee's
account is not liable for any tax payment. , The lump sum received at the time of retirement or resignation or
death is also
exempt under section 10(11) and 10(12).
36
incurred under section
3________, for an Indian company the aggregate of all the expenditure can be 5% of the cost of project or
5% of capital
employed whichever is higher.



one house
property ________.



Question In respect of leave travel concession If Mr. A has availed the exemption only once or has not
availed any
exemption at all, in the block of for years i.e. 1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of four years i.e. 2002-2005 provided
that he avails the
exemption of LTC in the first calendar year of the next block i.e. 2002.
Question Loss under the head Profits from Business or Profession can be adjusted against the Income
from Salaries.
Question The amount paid by the employer to the employee on his retirement is taxed as :-
purpose of
employment has to be in India for ________ days or more during previous year.
Correct Answer 182
Question Bad Debts recovered not allowed as deduction in earlier years is not taxable in any year.
37
Correct Answer True

Question The amount of advance tax payable by non corporate assessees before 15th March of Previous
year is :-
Question An assessee can claim deduction under section 35 in relation to the expenditure incurred on
scientific research
in the field of natural gas or applied sciences if :-
Correct Answer Any revenue expenses incurred by the assessee for carrying out the scientific research
provided that such
research is related to his business , Any capital expenses incurred by the assesse himself for carrying out
the scientific
research provided that such research is related to his business , The assesse is a company engaged in the
business of
bio-technology or any other notified product a weighted deduction of 150% is allowed in respect of in-house
research and
development expensed, till 31st March, 2005
company is not allowed
as revenue expenditure.
Question If a person is required to quote the PAN and he quotes or intimates a false number then he may
be liable to pay a
penalty of Rs. 25000.
retirement or
resignation or death of the employee?
taxable as
"Income from Other Sources" , Employer's Contribution to PF and interest thereon is taxable as "Income
from salaries"
Question If the person responsible for deducting the tax at source and paying the same to the credit of
Central
Government has not been allotted the Tax Deduction Account Number (TAN), he shall within ________
from the end of the month
in which the tax was deducted, apply for the allotment of TAN Number.
Question If the capital asset becomes the property of the assessee by virtue of gift or will, the period for
which the
capital asset is held by the previous owner should be excluded while deciding the holding period.
38
Question Amount paid by the employer in respect of any leave standing to the credit of the employee
after the date of
furnishing return of income, this sum was payable in the previous year is allowed as deduction.
Question Under section 43B, Clause N0-21 provides that the details of various payments are allowed as
deductions only if
they are actually paid but, where if the assessee follows the ________, the payments can be claimed on
due basis.
Correct Answer True

Question Any premium paid by the assessee by Cheque as an employer to effect or keep in force an
insurance on the health
of his employees is :-
Question Where an assessee files or submits the returns as per provisions of section 139 or in response
to the notice
under section 142, the assessment officer undertakes ________ as per section 143(2) and section 143(3).

88C of the IT Act.


Question In case of Payment of Interest on Securities no tax is required to be deducted under the
following circumstances
Correct Answer If the debentures are issued by a widely held company and the debentures are listed on a
stock exchange
39
and if the amount of interest does not exceed Rs. 2,500 during the financial year. , If the interest paid is on
State or
Central Government Securities , If the debentures are issued by an institution, authority, Public Sector
Company or
co-operative society as the Central Government may notify.
Question Expenditure incurred by an assessee on advertisement in any brochure, tract, pamphlet or like
published by a
________shall not be allowed as business expenditure.
Select The Blank


Correct Answer Employer's Contribution to PF is not liable for any tax payment , Interest credited
to the employee's account is not liable for any tax payment. , The lump sum received at the time of
retirement or resignation or death is also exempt under section 10(11) and 10(12).
Your Answer Employer's Contribution to PF is not liable for any tax payment , Interest credited to the
employee's account is not liable for any tax payment. , The lump sum received at the time of retirement or
resignation or death is also exempt under section 10(11) and 10(12).

:-
Correct Answer 0.3
Your Answer 0.3

Your Answer Winning from betting , Interest on securities of local authority , Bonus from key man
insurance policy
40
Select The Blank

Correct Answer 6
Your Answer 6
Select The Blank

Your Answer Salaries
Select The Blank

Question The person who does not deduct the tax source as required by the Act or after deducting
fails to pay the tax as required by the Act, shall be liable to pay the simple interest @________ % per month
on the amount of such tax from the date on which the tax was deductible till the date on which such tax is
actually paid.
Correct Answer 1
Your Answer 1
Select The Blank

Correct Answer 0.9
Your Answer 0.9

Your Answer 15000
True/False
Question Any sum payable by the assessee by way of tax, duty, cess or fee is allowed as deduction
even though they are not actually paid.
Your Answer False
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires company engaged in production,
mining, and manufacturing activities should maintain proper books of accounts showing the particulars of
utilization of material, labour or any other item.
41

Question As per the provision of section 143(2) and 143(3) scrutiny assessment made by assessing
officer in order to ensure that :-
Correct Answer Assessee has not understated the income , Assessee has not overstated the
loss , Assessee has under paid the taxes
Your Answer Assessee has not understated the income , Assessee has not overstated the loss ,
Assessee has under paid the taxes


Your Answer The computation of income under each head, Gross Total Income are properly filed in ,
The return is accompanied by the tax audit report under section 44AB , The return is accompanied by
copies of required financial statements of the assessee

Select The Blank

Question Mr. Ram is employed by the Central Government as accountant whose gross salary
income is Rs 6,00,000. He can claim standard deduction of Rs ________ u/s 16(i) of the IT Act.

Question Company means any body corporate incorporated under the laws of :-
Correct Answer Companies Act &/or laws of any foreign country
Your Answer Laws of any foreign country
True/False
42
Correct Answer True

Your Answer True


Your Answer The amount paid to the employee in lieu of or in commutation of an annuity on his
retirement on or after a specified age or on his becoming incapacitated prior to such retirement , The

Question A partnership firm is taxed @ :-
Your Answer Tax 35% flat
Select The Blank

Question If the person responsible for deducting the tax at source and paying the same to the credit
of Central Government has not been allotted the Tax Deduction Account Number (TAN), he shall within
________ from the end of the month in which the tax was deducted, apply for the allotment of TAN Number.
Your Answer One month

Question What is the due date for filing Annual return for TDS from payment of interest?
Select The Blank

Question ________ expenditure should not be allowed as expenditure u/s 37 (1) of the Income Tax
Act.
Correct Answer Capital
Your Answer Capital

43


Question The provisions for payment of gratuity is not allowed under section 40A(7) but, under the
head, profits from business and profession, the amount of gratuity will be allowed as deduction only when :-
Your Answer The amount of gratuity has actually become payable to the employees during the previous
year , The provision has been made for the payment of a sum by way of contribution to an approval gratuity
, The other than the above two situations, any provision made for the payment of gratuity is not allowed as
deduction

Question The exemption for Leave travel Concession u/s 10(5)is available in respect of how many
children Born after 1st October 1998?
Correct Answer Only 2
Your Answer Only 2

True/False
Question Insurance commission is income from business & profession.
Your Answer True


44
Question Any person carrying on business or profession has to submit the Audit Report in
prescribed form, signed by Chartered Accountant before 31st October of the assessment year, whether the
return of income is filed or not. This is in compliance with :-
Match The Following

interest to the employer The same shall be reduced from the valuation of perquisites. The same shall
be reduced from the valuation of perquisites.
Motor Car Perquisites which is taxable only in the hands of specified employee Perquisites which
is taxable only in the hands of specified employee
Services of sweeper, gardener, watchman or personal Perquisites which is taxable only in the
hands of specified employee Perquisites which is taxable only in the hands of specified employee
Specified Employee Specified Employee
True/False
Question For claiming the deduction under section 80IA, the industrial undertaking should be
owned by a company registered in India or a consortium of such companies.
Correct Answer True
Your Answer True

Question The provisions under section 44AB of the Act, is applicable to the person carrying on the
profession and whose gross receipts in profession :-
Select The Blank

Your Answer Borrowing
True/False
Question The amount of telephone bills (including the mobile phone bills) of the employee
Your Answer False
45
True/False
Correct Answer True
Your Answer True

True/False
Your Answer False
True/False
Question Dividend received from domestic company to its shareholders is taxable in the hands of
the shareholder.
Your Answer False
True/False
Correct Answer True
Your Answer True

Select The Blank

Match The Following

46
Deductions of Rent, Rates, Repairs, Taxes and Insurance on Buildings are available u/s 30 u/s 30
u/s 37 u/s 37
Deductions of Repairs & maintenance of machinery, plant & furniture are available u/s 31 u/s 31


True/False
Correct Answer True
Your Answer True

Your Answer Repairs & maintenance , Insurance premium , Interest on borrowed capital
Select The Blank

Question Dividends from the ________ is an exempt income and hence will not be included in the
Taxable income.
Correct Answer Indian Companies
Your Answer Proprietorship
47

Your Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata, Chennai
True/False
Correct Answer True
Your Answer True
True/False
Question If a person is required to quote the PAN and he quotes or intimates a false number then
he may be liable to pay a penalty of Rs. 25000.
Your Answer True
Select The Blank

Your Answer Depreciated and written off to profit and loss account
Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of various payments are
allowed as deductions only if they are actually paid but, where if the assessee follows the ________, the
Your Answer Accrual system of accounting

Question What is the tax treatment of Commuted Pension In case of a Government Employee?
Correct Answer The amount of commuted pension is exempt from tax as per the provisions of
Section 10(10A).
Your Answer The amount of commuted pension is exempt from tax as per the provisions of Section
10(10A).
48

Question For filing the returns of income, Form No. 2C is to be filled in by :-
Correct Answer Persons falling under One by Six Scheme
Your Answer Non-Corporate assessee

Your Answer Resident , Non resident

Select The Blank

Question It should be noted that the tax liability of an individual having the total income of less than
Rs ________ is Nil u/s 88D.
Your Answer 50000
Select The Blank

Select The Blank

Your Answer 20000
True/False
ordinary resident
Correct Answer True
Your Answer True
Select The Blank

Question Section 35E of the Act applies to all the ________ engaged in the business of prospecting
for or extraction or production of certain specified minerals.
Your Answer Resident assessees
49
Select The Blank


Your Answer Operation of Ship , Telecommunication Services
Select The Blank

Question Section 43B of the IT Act provides that the certain payments are allowed as deduction
only if they are ________.
Your Answer Payable

Question The following are the main types of income falling under the category of section 41 of the
Act, dealing with the deemed profits chargeable to tax and not credited to profit and loss account :-
Correct Answer Any amount received during the previous year in respect of loss or expenditure
where deduction has been allowed in the assessment year of any earlier , Any amount recovered against a
debt, where a deduction is allowed in respect of a bad debt in any of the earlier assessment year, the same
shall be deemed to be the profit in the year in which it is so recovered , If any asset used for scientific
research is sold and the sale proceeds along with benefits received by the assessee under section 35,
exceeds the amount of capital expenditure, the excess will be charged to income tax in the assessment year
Your Answer Any amount contributed towards promotion of social and economic welfare association in
the previous year shall be charge to income tax in the assessment year.
Select The Blank

Question The rebate u/s ________ is available to a woman assessee below the age of 65 years at
any time during the previous years.
Correct Answer 88C
Your Answer 88D
True/False
Question The entire amount of investment of Rs. 1,00,000 can be made in Infrastructure Bonds
issued by IDBI stated in section 88.
Correct Answer True
Your Answer True
Select The Blank

50
Question For claiming deductions u/s 37 of the IT Act, the expenditure should have been incurred
during the ________ .
Correct Answer Previous year
Your Answer Financial year
Select The Blank

Question The amount paid by the employer to the employee to meet the expenditure for residential
accommodation occupied by the employee is called ________.
Your Answer Hotel allowance
Select The Blank

Your Answer Company

True/False
Correct Answer True
Your Answer True


Your Answer Legal heir of deceased person , Parents of minor assessee
Match The Following

Disallowable Expenditure Litigation Expenses in connection with recovery of a debt which is not a trading
debt Includes vocation
51
Business Includes trade, commerce, or manufacture or any adventure or concern in the nature of
trade, commerce or manufacture Includes a transaction with oneself
Profession Includes vocation Expenditure incurred by a company with the issue of rights shares
Litigation Expenses in connection with recovery of a debt which is not a trading debt



True/False
Question Any sum payable by the assessee as interest on any loan borrowed by him from any state
financial corporation as per the terms on the agreement is not allowed as deduction from profit as per P & L
account, if they are actually paid before the due date of furnishing return of income.
Your Answer True
True/False
asset.
Your Answer True
True/False
Correct Answer True
Your Answer False
52

of :-
True/False
Question The rebate u/s 88B is allowed before the rebate u/s 88 is allowed.
Correct Answer True
Your Answer False

Your Answer Accrual system or mercantile system of accounting

following circumstances :-
Correct Answer If the debentures are issued by a widely held company and the debentures are
listed on a stock exchange and if the amount of interest does not exceed Rs. 2,500 during the financial year.
, If the interest paid is on State or Central Government Securities , If the debentures are issued by an
institution, authority, Public Sector Company or cooperative society as the Central Government may notify.
Your Answer If the debentures are issued by a widely held company and the debentures are listed on a
stock exchange and if the amount of interest does not exceed Rs. 2,500 during the financial year. , If the
debentures are issued by a widely held company and the debentures are listed on a stock exchange and if
the amount of interest does not exceed Rs.5,000 during the financial year.
Select The Blank

Question The amount of rebate/s 88C is 100% of the income tax liability before claiming the rebate
under section 88 and relief under section 89( 1) pr Rs.________ whichever is less.
Correct Answer 5000
Your Answer 20000
Select The Blank

Correct Answer 0.35
Your Answer 0.3

53
having a substantial interest in the business or profession of the individual or any director or partner of such
Your Answer Any relative of such individual , Any person (individual, company, firm etc.) having a
substantial interest in the business or profession of the individual or any director or partner of such company
or firm or any relative of such person.
Match The Following

cost or at the concessional rate Any allowance granted to meet the cost of travel on tour or on transfer
of duty.
expenditure for residential accommodation occupied by the employee Indicate benefits or amenities
provided by the employer to the employee, either free of cost or at the concessional rate

Any amount granted to an employee to meet his expenditure for the purpose of commuting
between the place of residence and the place of duty

Select The Blank

Question House rent allowance is exempt from the heading ________.
Your Answer Income from house property

54

Correct Answer 80 IA profits and gains of infrastructure companies , 80 G Donations , 80 HHB
profits and gains from projects outside India
Your Answer 80 G Donations , 88 PPF , 80 IA profits and gains of infrastructure companies

The return is accompanied by copies of required financial statements of the assessee , The return is filed on
31st August of the assessment year
Select The Blank

Your Answer Not allowed

Question Exempt income is income not considered while calculating :-
Correct Answer Total income
Your Answer Gross taxable income

Question Which section of the Act provides that an assessee may follow a system of accounting to
calculate the income from business and profession and income from other sources?
Correct Answer Section 145
Your Answer Section 139

Your Answer Within six months from the date of transfer of the long-term capital asset , Within three
months from the date of transfer of the long-term capital asset
True/False
Question The amount of expenses including membership fees and annual fees incurred by the
employee on credit card and which are paid by the employer shall be added as the perquisites unless the
said expenses are incurred wholly and exclusively for official purposes.
Correct Answer True
Your Answer True
55

Your Answer Deduction can be for principal portion also , Borrowal is after 1st April 1999
True/False
previous year.
Correct Answer True
Your Answer False

Match The Following

Rebate Under Section 88CIs available to a woman assessee below the age of 65 years at any time during
the previous years. Is available to an individual who has attained the age of 60 or more at any time
Jeevan Dhara or Jeevan Akshay Deferred Annuity Plan of LlC Any educational institution in India
for the purpose of full time education of the individual's children.
Any amount paid by an individual as tuition fees is eligible for rebate u/s 88 only if payment is made to
Any educational institution in India for the purpose of full time education of the individual's children.
Are the Deferred Annuity Plan of ICICI
Rebate Under Section 88BIs available to an individual who has attained the age of 65 or more at any time
during the previous year. Deferred Annuity Plan of LlC

Your Answer Joint Stock Company
True/False
Question Professional Tax paid by a person carrying on the business is allowed as business
expenditure.
Correct Answer True
56
Your Answer True

Select The Blank

Correct Answer None
Your Answer None
True/False
Question If the defective return filed under section 139(9) is not rectified within 15 days, the return
filed by the assesee shall be considered invalid and it will be treated as if the return has not filed.
Correct Answer True
Your Answer True

Your Answer Salary earned in India even if paid outside India , Salary paid by Government to Indian
national for services rendered outside India , Tax deducted in India
Select The Blank

Question Share of profit is calculated after ________.
Correct Answer Profit after tax
Your Answer Profit after tax

Question Annual return for TDS from payment of interest is to be filed in :-

Question The Basic Rule for computing Deduction from Chapter VI A is :-
Correct Answer The amount of deductions under the provisions of Chapter VI-A cannot exceed
the Gross Total Income.
Your Answer The amount of deductions under the provisions of Chapter VI-A cannot exceed the Gross
Total Income.
Select The Blank

57
Taxable income.
Your Answer Indian Companies
Select The Blank

Correct Answer 182
Your Answer 60

March, 2005
Your Answer Any revenue expenses incurred by the assessee for carrying out the scientific research
provided that such research is related to his business , Any capital expenses incurred by the assesse
himself for carrying out the scientific research provided that such research is related to his business
Select The Blank

Your Answer Actually paid
Match The Following

Rebate Under Section 88BIs allowed to Senior Citizens Is allowed to Senior Citizens
Rebate u/s 88 Is allowed to individual or HUF Is allowed only to womean assessee below 65 years
of age
Rebate u/s 88C Is allowed only to womean assessee below 65 years of age Is allowed to Company
Rebate Under Section 88DIs allowed only to Individual assesses Is allowed only to Individual
assesses

58


Question The specified assets for the purpose of claiming exemption from Capital Gains u/s 54EC
mean the bonds redeemable after 3 years issued by the following institutions
Correct Answer National Bank for Agriculture and Rural Development (NABARD) , Rural
Electrification Corporation Limited , Small Industries Development Bank of India
Your Answer National Bank for Agriculture and Rural Development (NABARD) , Rural Electrification
Corporation Limited
True/False
Correct Answer True
Your Answer False

the time of :-
Select The Blank


Your Answer The Finance Act

of :-
59

Question The Central Government has introduced a new pension scheme for the employees
employed on or after 15th January, 2004. These employees are required to contribute 10% of their salaries
to this pension scheme and the Central Government will make an equal contribution. How will the
contribution of Central Government be taxed?
Correct Answer As Income from Salary
Your Answer As Income from Salary
Select The Blank

Question The amount paid by the employer to the employee to meet the expenditure for residential

Your Answer Refund of Income tax , Dividend Income , Bad Debts recovered allowed as deduction in
earlier years

Your Answer Income Tax , Wealth Tax , Sales Tax
True/False
Your Answer True
Select The Blank

Your Answer Rs. 75000

Question The assessing officer may allot the Permanent Account Number(PAN) to :-
Correct Answer Person whose Total Income during previous year exceeds the maximum amount,
chargeable to tax , Person carrying on the business or profession whose turnover exceeds Rs.5 lakhs in any
previous year , Any other person by whom tax is payable
60
Your Answer Person whose Total Income during previous year exceeds the maximum amount,
True/False
Question Amount spent for training the employees and amount spent by the employer as fees for
sending the employee for the refresher courses (including the lodging and boarding expenses incurred by
the employee) is exempt from tax.
Correct Answer True
Your Answer True
Select The Blank

Your Answer A company

Your Answer Any person (individual, company, firm etc.) having a substantial interest in the business or
profession of the individual or any director or partner of such company or firm or any relative of such person.
, Any person who carries on a business or profession and in his business or profession, the assessee
himself or his relative has a substantial interest. , Any person who is not substantially interested nor any
relatives of the individual

Question Deduction from Gross Total Income in respect of payment for Medical treatment of
Handicapped is available under Section :-
Correct Answer Section 80DD
Select The Blank

Rs ________ is Nil u/s 88D.
Your Answer 50000
True/False
Your Answer True
61

Your Answer Expenditure in connection with the issue of bonus shares

Correct Answer Agent of NRI , Legal heir of deceased person , Parents of minor assessee
Your Answer Agent of NRI , Legal heir of deceased person , Parents of minor assessee
True/False
Question Refund of Income tax is taxable as Income from business or profession.
Your Answer False


Question The exemption for Leave travel Concession u/s 10(5)is available in respect of :-
Correct Answer Two journeys performed in the block of four years.
Your Answer Two journeys performed in the block of four years.

Select The Blank

62

Question The maximum amount of deduction permissible u/s 80CCC is Rs. :-
Your Answer 10000

Question The losses incurred can be set off :-
Correct Answer To reduce the Gross Total Income
Your Answer To reduce the tax liability
True/False
head of income.
Correct Answer True
Your Answer True
True/False
Question If the capital asset becomes the property of the assessee by virtue of gift or will, the
period for which the capital asset is held by the previous owner should be excluded while deciding the
holding period.
Your Answer False

Question Rebate is allowed on any subscription made to the notified deposit scheme, interest on
which is not eligible for deduction under Section 80L of the Act :-
Correct Answer Of a housing finance company , Of any authority satisfying the needs of housing
accommodations or planning & development of cities, towns etc.
Your Answer Of a housing finance company , Of any authority satisfying the needs of housing
Select The Blank


63


Select The Blank

Question Expenditure incurred by way of fees etc. in connection with any proceedings under
Income Tax Act are ________ as business expenditure
Your Answer Allowed

Select The Blank

True/False
Correct Answer True
Your Answer True
Select The Blank

Your Answer 20000
True/False
Correct Answer True
Your Answer True
64

Match The Following

Superannuation Fund It is an employee welfare scheme It is an employee welfare scheme
set up as per the provisions of Provident Fund Act, 1925.
Recognized Provident Fund the provisions of Employees Provident Fund and Miscellaneous
Provisions Act, 1952 apply to this fund. the provisions of Employees Provident Fund and
Miscellaneous Provisions Act, 1952 apply to this fund.
authorities . The provident fund which is not recognized by the income tax authorities .


Question What is the treatment of the perquisite in the form of Gas, electricity and water supplied to
the employee?
Correct Answer If the facility of gas, electricity and water is supplied by the employer to the
employee purchasing the same from an outside agency, the valuation of perquisite will be the charges paid
by the employer to the outside agency supplying gas, electricity and water. , If the facility in the form of gas,
electricity and water is supplied by the employer out of his own resources, the valuation of perquisite will be
the manufacturing cost per unit incurred by the employer.
Your Answer If the facility of gas, electricity and water is supplied by the employer to the employee
purchasing the same from an outside agency, the valuation of perquisite will be the charges paid by the
employer to the outside agency supplying gas, electricity and water. , If the facility in the form of gas,
True/False
Your Answer True
65
True/False
Correct Answer True
Your Answer True
Select The Blank


Previous year is :-


Match The Following

When the employee sells the shares allotted to him under the Employees Stock Option Plan Liability
to pay the tax under the head Income from Capital Gains arises Liability to pay the tax under the
head Income from Capital Gains arises
For the purpose of Standard deduction the term Salary includes All components of Salary to the
extent they are not exempt from tax. All components of Salary to the extent they are not exempt
from tax.
Tax on Employment is an indirect tax levied by the state Government. is an indirect tax levied by
the state Government.
In respect of the amount of salary received in advance or in arrears Relief under section 89 is available
to an employee Relief under section 89 is available to an employee
66

the payee.
Your Answer There needs to be an employer-employee relationship between the payer and the payee.
True/False
Question Interest is payable by the assessee for not paying the Advance tax or if the Advance tax
paid by the assessee is less than 80% of the Assessed tax after adjusting the amount of TDS and Advance
tax Paid
Your Answer False

Your Answer Motor Car , Services of sweeper, gardener, watchman or personal attendant , Gas,
True/False
Question Sum received under a will / inheritance is not exempt.
Correct Answer True
Your Answer True
Select The Blank

Question For the employee who is blind or orthopaedically handicapped with disability of lower
extremities, the transport allowance exempt is Rs. ________ per month.
Correct Answer 1600
Your Answer 1600
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the form of computers an
Correct Answer 50
Your Answer 50

67
Your Answer A minor of whom he is the guardian.



amounts
Your Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly and exclusively in
Select The Blank

actually paid.
Correct Answer 1
Your Answer 1
Select The Blank

Your Answer Indian


68

Question The amount of advance tax payable by non corporate assessees before 15th June of
Previous year is :-
Correct Answer Nil
Your Answer Nil
Select The Blank

Question 1 Mr X a salaried employee has received total educational allowance of Rs 8,000 for his
four children, the maximum allowance exempt is ________ u/s 10(14) of the IT Act.

Question2 What is the tax treatment of the Lump sum received from unrecognized provident fund on
Employer's Contribution to PF and interest thereon is taxable as "Income from salaries" , Employee's
contribution to PF is exempt from tax
True/False
Question 3 Software technology park means set up according to Software Technology Park Scheme
framed by Ministry of Commerce & Industries.
Correct Answer True
Your Answer True
Select The Blank

Question 4 It is mandatory for ________ to file a return even if there is loss or the income is nil.

69

Question 6 Which of the following amounts credited to P & L Account but not taxable from Income tax
Select The Blank

Select The Blank

Question 8 The amount paid by the employer to the employee to meet the expenditure for residential

Question 9 Any amount deposited by an Individual or a HUF in 10 year or 15 year account under the
Select The Blank



Question 12 The total amount of rebates under Section 88, Section 88B, Section 88C and Section 88D
of the Act. shall :-

70

Question 14 Perquisites which are taxable only in the hands of specified employee include the

Question 15 The Central Government has introduced a new pension scheme for the employees
to this pension scheme. How much will the Central Government contribute to the Fund?
True/False
the employer.
Correct Answer True
Your Answer True

Question 17 If any person fails to get the accounts audited by a Chartered Accountant and fails to
Select The Blank

Question 18 Section 35E of the Act applies to all the ________ engaged in the business of prospecting

71
True/False
Your Answer False
Select The Blank


Question 22 The various payments which are referred as deductions under section 43B, Clause No-21
are :-
the agreement
Your Answer Any employees contribution payable by the assessee towards any Provident Fund or
Superannuation Fund or Gratuity Fund for the welfare of the employees , Any sum payable by the assessee
by way of tax duty, cess or fee , Any sum payable by the assessee as interest on any loan or borrowing
made by him from any public financial institution or state financial corporation as per the terms of the
agreement
Select The Blank

Question 23 The rebate u/s ________ is available to a woman assessee below the age of 65 years at
Correct Answer 88C
Your Answer 88B
True/False
Question 24 An deduction is allowed to an assesse as an employer in respect of contribution made to
any non-statutory fund under the section 40A(9).
Your Answer True
True/False
Question 25 Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34) of
the IT Act.
Your Answer False

72
bank transactions
Your Answer All returns to or correspondence with the Income Tax Authorities , All the challans for the
payment of any amount under the Act , All the documents pertaining to purchase, sale and bank
transactions


Question 28 In case of the individual or HUF whose Gross Total Income, before deductions under


Question 30 In order to avoid the cases of tax evasion on the part of the assessees, the Act has
provided for :-

Question 31 Which of the following expenditures are expressly disallowed to be deducted while
True/False
Question 32 Section 80QQB is applicable to the individual resident who is an author of text books.
Your Answer False
Select The Blank

73
Question 33 Section 35AC of the Act applies to any sum paid by the assessee to a public sector



Your Answer Purchase of Building , Construction of temporary structures , Purchase of machinery
True/False
Question 37 Loss under the head Profits from Business or Profession can be adjusted against the
Your Answer False
Select The Blank

Correct Answer 0.9
Your Answer 0.9
True/False
Question 39 Rebates as per the provisions of Section 88C of the Act are not available from the tax on
Your Answer False
True/False
Question 40 Dividend received from domestic company to its shareholders is taxable in the hands of
the shareholder.
Your Answer True
74
Match The Following

Super Annuation Fund This is an employee welfare scheme which is usually applicable in case of very
senior employees This is an employee welfare scheme which is usually applicable in case of very senior
employees
maintained by Government organizations, local authorities, universities and educational institutions.
This is set up as per the provisions of Provident Fund Act, 1925. This is maintained by Government
organizations, local authorities, universities and educational institutions.
Recognised Provident Fund This is the provident fund to which the provisions of Employees
Provident Fund and Miscellaneous Provisions Act, 1952 apply. This is the provident fund to which the
provisions of Employees Provident Fund and Miscellaneous Provisions Act, 1952 apply.
Unrecognised Provident Fund The provident fund which is not recognized by the income tax
authorities is called as unrecognized provident fund. The provident fund which is not recognized by the
income tax authorities is called as unrecognized provident fund.

Select The Blank

Question 43 The amount of compensation received or receivable by the employee from the employer

Match The Following

Excluded from ambit of term Capital Asset Stock in Trade Land held for a period of 36 months or more
Short Term Capital Asset Equity Shares held for a period of Less than 36 months Stock in Trade
Long Term Capital Asset Land held for a period of 36 months or more Building
75

Question 45 The entertainment allowance received by the Government employees is included in their
True/False
Question 46 Annual premium paid by the employer for the accident insurance policy taken by the
Your Answer False

Question 47 Following condition needs to be satisfied for claiming the exemption under Section 54F :-

True/False
Correct Answer True
Your Answer False
Select The Blank

Question 50 Expenditure incurred in connection with the local festivals like Diwali etc. are ________ as
Your Answer Allowed
Select The Blank

Question 51 Deduction is available for income from foreign sources under Section 80RR if such
Correct Answer 6
Your Answer 6
76


Question 53 Income from winning from lotteries / crossword puzzles/ horse races is taxed at flat rate of
:-
Correct Answer 0.3
Your Answer 0.35
Select The Blank

Question 54 Section 35D of the Act provides that the preliminary expenses can be ________ over a
Select The Blank

Question 55 Section 43B of the IT Act provides that the certain payments are allowed as deduction




77
Question 59 If an employee does not avail of this leave travel concession or assistance during a block
Select The Blank

Question 60 The person who does not deduct the tax source as required by the Act or after deducting
actually paid.
Correct Answer 1
Your Answer 1.25

Your Answer Person carrying on the business or profession whose turnover exceeds Rs.5 lakhs in any
previous year , Any other person by whom tax is payable , Any person not applying for permanent account
number but, tax is payable by him

Question 62 The provisions for payment of gratuity is not allowed under section 40A(7) but, under the
deduction

Your Answer The person who is director of a company , The employee who has substantial interest in
True/False
78

Correct Answer True
Your Answer False
Select The Blank

Question 65 It should be noted that the tax liability of an individual having the total income of less than
Rs ________ is Nil u/s 88D.
Match The Following

depreciation is 60%
Select The Blank

Correct Answer 0.35
Your Answer 0.35


Question 69 For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term "Specified
Your Answer Any partner of the firm or his relative , Any person having the substantial interest in the
business or profession of the firm or any director or partner of such company or firm or any relative of such
person. , Any person who carries on business or profession and in his business or profession the assessee
or any partner of such firm or relative of such partner has substantial interest.
79

the payee.
True/False
Question 71 For claiming the deduction under section 80IA, the industrial undertaking should be
Correct Answer True
Your Answer True
Select The Blank

Question 72 Any expenditure incurred by the assessee for any purpose which is ________ or which is
Your Answer Offence

Question 73 As a general principle, the Basic Salary or Wages, Dearness Allowance and Bonus /
Commission is :-
True/False
Question 74 Rebates as per the provisions of Section 88 of the Act are not available from the tax on
Correct Answer True
Your Answer True
True/False
Question 75 MAT is applicable if there is a difference of 7.5% between net profit & book profit.
Correct Answer True
Your Answer False

Question 76 For the purpose of Section 40 A (2) of the IT Act, if assessee is an individual, the term
80
or firm or any relative of such person. , Any person who carries on a business or profession and in his
business or profession, the assessee himself or his relative has a substantial interest.
Select The Blank

Question 77 Deduction for remuneration from foreign sources for professors, teachers etc under
Correct Answer 15
Your Answer 10
True/False
Question 78 Any expenditure incurred for earning the income which is included under the head income
from other sources will be allowed as deduction from such income provided that certain conditions are
satisfied
Correct Answer True
Your Answer True

Question 79 Deduction from Capital Gains from the transfer of residential house property under
Section 54 is available to :-
True/False
Question 80 Income earned & received outside India & remitted to India is taxable for resident &
ordinary resident
Correct Answer True
Your Answer True

Question 81 Mr X has received Rs 200000 as income from salary, Rs 50000 income from house
property and he also received Rs 100000 income from specified units of the mutual fund. What will be his
total income

Match The Following

81
Individual partners Can be partners in any number of firms Can be partners in any number of
firms

Question 84 Capital Gains arise on account of excess of transfer consideration over the following
amounts
True/False
Your Answer False
Select The Blank

Question 86 If sum received is net of TDS then it is ________ to include in income from other sources.

True/False
Question 88 Interest paid on the loan for acquiring a capital asset will be considered to be a part of
Correct Answer True
Your Answer True

82


Question 90 Deduction from Capital Gains under Section 54F is for Capital Gains arising from transfer
of :-

Question 91 In case the assessee is not a company, a person(other than a company) who is falling
Select The Blank

Question 92 Registration charges in connection with the increasing of ________ share capital of the
True/False
Your Answer False

Question 94 As per which provision and section, every person, company or any other person shall
furnish his returns of income in the prescribed form on or before the specified due date?
Select The Blank

Question 1 Mr X a salaried employee has received total educational allowance of Rs 8,000 for his
four children, the maximum allowance exempt is ________ u/s 10(14) of the IT Act.
83

Question2 What is the tax treatment of the Lump sum received from unrecognized provident fund on
Employer's Contribution to PF and interest thereon is taxable as "Income from salaries" , Employee's
contribution to PF is exempt from tax
True/False
Question 3 Software technology park means set up according to Software Technology Park Scheme
framed by Ministry of Commerce & Industries.
Correct Answer True
Your Answer True
Select The Blank

Question 4 It is mandatory for ________ to file a return even if there is loss or the income is nil.


Question 6 Which of the following amounts credited to P & L Account but not taxable from Income tax
Select The Blank

Select The Blank

Question 8 The amount paid by the employer to the employee to meet the expenditure for residential
84

Question 9 Any amount deposited by an Individual or a HUF in 10 year or 15 year account under the
Select The Blank



Question 12 The total amount of rebates under Section 88, Section 88B, Section 88C and Section 88D


Question 14 Perquisites which are taxable only in the hands of specified employee include the

Question 15 The Central Government has introduced a new pension scheme for the employees
to this pension scheme. How much will the Central Government contribute to the Fund?
True/False
85
the employer.
Correct Answer True
Your Answer True

Question 17 If any person fails to get the accounts audited by a Chartered Accountant and fails to
Select The Blank

Question 18 Section 35E of the Act applies to all the ________ engaged in the business of prospecting

True/False
Your Answer False
Select The Blank


Question 22 The various payments which are referred as deductions under section 43B, Clause No-21
are :-
the agreement
86
agreement
Select The Blank

Question 23 The rebate u/s ________ is available to a woman assessee below the age of 65 years at
Correct Answer 88C
Your Answer 88B
True/False
Question 24 An deduction is allowed to an assesse as an employer in respect of contribution made to
any non-statutory fund under the section 40A(9).
Your Answer True
True/False
Question 25 Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34) of
the IT Act.
Your Answer False

bank transactions
transactions


Question 28 In case of the individual or HUF whose Gross Total Income, before deductions under
87


Question 30 In order to avoid the cases of tax evasion on the part of the assessees, the Act has
provided for :-

Question 31 Which of the following expenditures are expressly disallowed to be deducted while
True/False
Question 32 Section 80QQB is applicable to the individual resident who is an author of text books.
Your Answer False
Select The Blank

Question 33 Section 35AC of the Act applies to any sum paid by the assessee to a public sector



88
True/False
Question 37 Loss under the head Profits from Business or Profession can be adjusted against the
Your Answer False
Select The Blank

Correct Answer 0.9
Your Answer 0.9
True/False
Question 39 Rebates as per the provisions of Section 88C of the Act are not available from the tax on
Your Answer False
True/False
Question 40 Dividend received from domestic company to its shareholders is taxable in the hands of
the shareholder.
Your Answer True
Match The Following

employees
Recognised Provident Fund This is the provident fund to which the provisions of Employees
Unrecognised Provident Fund The provident fund which is not recognized by the income tax
89

Select The Blank

Question 43 The amount of compensation received or receivable by the employee from the employer

Match The Following

Excluded from ambit of term Capital Asset Stock in Trade Land held for a period of 36 months or more
Long Term Capital Asset Land held for a period of 36 months or more Building

Question 45 The entertainment allowance received by the Government employees is included in their
True/False
Question 46 Annual premium paid by the employer for the accident insurance policy taken by the
Your Answer False

Question 47 Following condition needs to be satisfied for claiming the exemption under Section 54F :-

90

True/False
Correct Answer True
Your Answer False
Select The Blank

Question 50 Expenditure incurred in connection with the local festivals like Diwali etc. are ________ as
Your Answer Allowed
Select The Blank

Question 51 Deduction is available for income from foreign sources under Section 80RR if such
Correct Answer 6
Your Answer 6


Question 53 Income from winning from lotteries / crossword puzzles/ horse races is taxed at flat rate of
:-
Correct Answer 0.3
Your Answer 0.35
Select The Blank

Question 54 Section 35D of the Act provides that the preliminary expenses can be ________ over a
Select The Blank

91
Question 55 Section 43B of the IT Act provides that the certain payments are allowed as deduction




Question 59 If an employee does not avail of this leave travel concession or assistance during a block
Select The Blank

Question 60 The person who does not deduct the tax source as required by the Act or after deducting
actually paid.
Correct Answer 1
Your Answer 1.25

92
Your Answer Person carrying on the business or profession whose turnover exceeds Rs.5 lakhs in any
previous year , Any other person by whom tax is payable , Any person not applying for permanent account
number but, tax is payable by him

Question 62 The provisions for payment of gratuity is not allowed under section 40A(7) but, under the
deduction

True/False
Correct Answer True
Your Answer False
Select The Blank

Question 65 It should be noted that the tax liability of an individual having the total income of less than
Rs ________ is Nil u/s 88D.
Match The Following


93
depreciation is 60%
Select The Blank

Correct Answer 0.35
Your Answer 0.35


Question 69 For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term "Specified
Your Answer Any partner of the firm or his relative , Any person having the substantial interest in the

the payee.
True/False
Question 71 For claiming the deduction under section 80IA, the industrial undertaking should be
Correct Answer True
Your Answer True
Select The Blank

Question 72 Any expenditure incurred by the assessee for any purpose which is ________ or which is
Your Answer Offence
94

Question 73 As a general principle, the Basic Salary or Wages, Dearness Allowance and Bonus /
Commission is :-
True/False
Question 74 Rebates as per the provisions of Section 88 of the Act are not available from the tax on
Correct Answer True
Your Answer True
True/False
Question 75 MAT is applicable if there is a difference of 7.5% between net profit & book profit.
Correct Answer True
Your Answer False

Question 76 For the purpose of Section 40 A (2) of the IT Act, if assessee is an individual, the term
or firm or any relative of such person. , Any person who carries on a business or profession and in his
business or profession, the assessee himself or his relative has a substantial interest.
Select The Blank

Question 77 Deduction for remuneration from foreign sources for professors, teachers etc under
Correct Answer 15
Your Answer 10
True/False
Question 78 Any expenditure incurred for earning the income which is included under the head income
from other sources will be allowed as deduction from such income provided that certain conditions are
satisfied
Correct Answer True
Your Answer True

95
Question 79 Deduction from Capital Gains from the transfer of residential house property under
Section 54 is available to :-
True/False
Question 80 Income earned & received outside India & remitted to India is taxable for resident &
ordinary resident
Correct Answer True
Your Answer True

Question 81 Mr X has received Rs 200000 as income from salary, Rs 50000 income from house
property and he also received Rs 100000 income from specified units of the mutual fund. What will be his
total income

Match The Following

Individual partners Can be partners in any number of firms Can be partners in any number of
firms

Question 84 Capital Gains arise on account of excess of transfer consideration over the following
amounts
96
True/False
Your Answer False
Select The Blank

Question 86 If sum received is net of TDS then it is ________ to include in income from other sources.

True/False
Question 88 Interest paid on the loan for acquiring a capital asset will be considered to be a part of
Correct Answer True
Your Answer True


Question 90 Deduction from Capital Gains under Section 54F is for Capital Gains arising from transfer
of :-

Question 91 In case the assessee is not a company, a person(other than a company) who is falling
Select The Blank

97
Question 92 Registration charges in connection with the increasing of ________ share capital of the
True/False
Your Answer False

Question 94 As per which provision and section, every person, company or any other person shall

Your Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 , 1/5th of Salary
True/False
Your Answer False


98

Select The Blank

True/False
Correct Answer True
Your Answer True


True/False
Correct Answer True
Your Answer True

respect of
Your Answer Interest on Central or State Government Securities , Interest on National Saving

99

Your Answer Perquisites which are taxable in case of all types of employees , Perquisites which are
Select The Blank

Correct Answer 182
Your Answer 182


Select The Blank


Select The Blank


100


Select The Blank


of :-
Select The Blank

143(2) and section 143(3).

True/False
Correct Answer True
Your Answer True

101
Your Answer He can carry over the exemption to the next block of four years i.e. 2002-2005 provided
that he avails the exemption of LTC in the first calendar year of the next block i.e. 2002.

the time of :-


Commission is :-

Your Answer 80 G Donations , 80 IA profits and gains of infrastructure companies

Your Answer Taxable
Select The Blank

Your Answer 20000

to be reinvested :-
102
Select The Blank

Correct Answer 10
Your Answer 10
True/False
Your Answer False
Select The Blank

Match The Following

debt Litigation Expenses in connection with recovery of a debt which is not a trading debt
trade, commerce or manufacture Includes trade, commerce, or manufacture or any adventure or concern
in the nature of trade, commerce or manufacture
True/False
Your Answer False
True/False
the employer.
Correct Answer True
103
Your Answer True
True/False
previous year.
Correct Answer True
Your Answer True

True/False
Correct Answer True
Your Answer True
Match The Following

By an individual or a HUF is eligible for rebate u/s 88
for the A Y 2005-2006. RS.12,500 RS.12,500
during the said Assessment Year. her tax liabilit is Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund Is eligible for rebate u/s 88 Is eligible for rebate u/s 88


104
True/False
Correct Answer True
Your Answer False
Select The Blank

Your Answer Political party

Your Answer Wealth Tax , Income Tax



105


Correct Answer Donations eligible for 100% deduction without any qualifying limit. , Donations
eligible for 50% deduction without any qualifying limit , Donations eligible for 75% deduction subject to
qualifying limit
Your Answer Donations eligible for 100% deduction without any qualifying limit. , Donations eligible for
50% deduction without any qualifying limit

Your Answer Trade or business or service outside its jurisdiction
True/False
Your Answer False
Select The Blank

Your Answer 15000
Select The Blank

Correct Answer 50
Your Answer 40
Select The Blank

received ________.
Your Answer In advance or in arrears
Select The Blank

106

Your Answer Allowed
Select The Blank

Correct Answer 6
Your Answer 6
True/False
Your Answer True

Correct Answer 0.25
Your Answer 0.25
True/False
Your Answer False



107
Your Answer The amount paid by way of refund of contribution to the legal heirs on the death of the
beneficiary. , Rs. 25,000 , The amount paid to the employee in lieu of or in commutation of an annuity on his
retirement on or after a specified age or on his becoming incapacitated prior to such retirement
True/False
Correct Answer True
Your Answer True



the time of :-


Your Answer Will include vocation.
108
True/False
Correct Answer True
Your Answer False
Select The Blank

Select The Blank

Your Answer Residual
Match The Following

interest to the employer The same shall be reduced from the valuation of perquisites. The same shall
be reduced from the valuation of perquisites.
Motor Car Perquisites which is taxable only in the hands of specified employee Perquisites which
is taxable only in the hands of specified employee
Services of sweeper, gardener, watchman or personal Perquisites which is taxable only in the
hands of specified employee Perquisites which is taxable only in the hands of specified employee
Specified Employee Specified Employee

profession
Your Answer Allowed as revenue expenditure while calculating the profits from business and profession
Select The Blank

109
True/False
asset.
Your Answer False
True/False
Your Answer True
True/False
Your Answer True
Match The Following

Select The Blank

Correct Answer 50
Your Answer 30


110
Correct Answer Any person who carries on a business or profession and in his business the
assessee or any director of such company or relative of such director has substantial interest. , Any director
of the company or his relative , Any person having a substantial interest in the business or profession of the
company or any director or partner of such firm or company or the relative of such person.
Your Answer Any director of the company or his relative, Any person having a substantial interest in the
business or profession of the company or any director or partner of such firm or company or the relative of
such person.


Correct Answer Any partner of the firm or his relative, Any person having the substantial interest
Your Answer Any partner of the firm or his relative, Any person having the substantial interest in the
person.

Your Answer Value at which house property is valued
True/False
head of income.
Correct Answer True
Your Answer True

of :-
Your Answer Agricultural Land
Select The Blank

111
Correct Answer 0.02
Your Answer 0.02
True/False
Your Answer True

Question The various payments which are referred as deductions under section 43B, Clause No-21
are :-
the agreement
by way of tax duty, cess or fee

Your Answer Income from business profession
Select The Blank

Your Answer Short Term Capital Gains.
True/False
property.
Correct Answer True
Your Answer True
112

True/False
Your Answer False

Employer's Contribution to PF and interest thereon is taxable as "Income from salaries"

True/False
ordinary resident
Correct Answer True
Your Answer False
True/False
Question Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34) of
the IT Act.
Your Answer True

bank transactions
113
transactions

retirement on or after a specified age or on his becoming incapacitated prior to such retirement , The
True/False
Correct Answer True
Your Answer True

Your Answer During the previous year in which the Capital Assets is transferred
Select The Blank

Act.
Your Answer Personal

invested an amount of Rs.10,000 in the PPF account opened in the name of his wife. Which of the following
is true?
Your Answer Mr. A will not be entitled to any rebate u/s 88
True/False
deemed to be the income of the person borrowing or repaying the amount for the previous year in which the
amount was borrowed or repaid.
Correct Answer True
Your Answer True
114
True/False
Your Answer False

Your Answer Cash system or Accrual system of accounting
Select The Blank


Your Answer The return is accompanied by the tax audit report under section 44AB , The return is
accompanied by copies of required financial statements of the assessee , The computation of income under
each head, Gross Total Income are properly filed in


Select The Blank

Select The Blank

115

property is :-
Your Answer Annual value


transfer of :-
Your Answer Securities


Your Answer Individual, Hindu Undivided Family.

Your Answer 31st October of the Assessment year
Select The Blank

116

following :-
True/False
Correct Answer True
Your Answer True
Select The Blank

Your Answer Professional

source :-
Your Answer Any Local Authority , Any Trust , Any Individual


not a Senior Citizen is Rupees :-
Select The Blank

117

Your Answer Exempt

True/False
Correct Answer True
Your Answer False

Correct Answer Any relative of such individual, Any person (individual, company, firm etc.) having
a substantial interest in the business or profession of the individual or any director or partner of such
Your Answer Any relative of such individual, Any person (individual, company, firm etc.) having a
or firm or any relative of such person.

Your Answer Flat rate of 35%
Match The Following

118
authorities . The provident fund which is not recognized by the income tax authorities.
Select The Blank

Correct Answer 0.02
Your Answer 0.02
Select The Blank

Your Answer Offence
Match The Following

employees
Recognized Provident Fund This is the provident fund to which the provisions of Employees
Select The Blank

Your Answer Indian
119

Your Answer Construction , Purchase , Repair
Select The Blank

Correct Answer None
Your Answer None
Select The Blank

True/False
Correct Answer True
Your Answer True
Select The Blank

Correct Answer 0.9
Your Answer 0.5

amounts
Your Answer Cost of acquisition , Cost of improvement

Correct Answer 0.1
Your Answer 0.1
120



Select The Blank


national for services rendered outside India
True/False
Correct Answer True
Your Answer True

Your Answer No rebate will be available u/s 88.
121

Select The Blank

Select The Blank

Your Answer Wholly and exclusively

Match The Following

Uncommuted Pension Indicates the periodical payment of pension Income from other sources
Commuted Pension Indicates the lump sum received in lieu of the periodical Indicates the
periodical payment of pension
Treatment of Perquisite Taxed in the hands of employee as taxable salary Taxed in the hands of
employee as taxable salary

Select The Blank

122
True/False
Correct Answer True
Your Answer True

Select The Blank

Correct Answer 600
Your Answer 600

Your Answer Resident , Non resident , Resident but not ordinary resident
Select The Blank

True/False
Correct Answer True
Your Answer True


123
Section 54 is :-
within two years after the date on which transfer took place; Assessee must have constructed another
Your Answer Assessee must have purchased another residential property one year before or within two
years after the date on which transfer took place; Assessee must have constructed another residential
property within, three years after the date on which the transfer took place.
Select The Blank

True/False
as deduction.
Your Answer True
Match The Following

debt Premium on redemption of Debentures

Your Answer The individual himself, A minor of whom he is the guardian. , Spouse of individual

124

Your Answer Interest on securities of local authority , Bonus from key man insurance policy , Pension
True/False
Correct Answer True
Your Answer False

March, 2005
provided that such research is related to his business , Any capital expenses incurred by the assesse
himself for carrying out the scientific research provided that such research is related to his business


Previous year is :-

125
True/False
Your Answer True

respect of
Certificates (NSCs) Interest on National Saving Scheme, 1992 (NSS)
Select The Blank

Select The Blank

Your Answer Promotion of education and literacy

Previous year is :-

Your Answer Company secretary , Accounting

Your Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is more
126

True/False
Your Answer False


Select The Blank

True/False
Correct Answer True
127
Your Answer True


True/False
Correct Answer True
Your Answer True

respect of


Select The Blank

Correct Answer 182
128
Your Answer 182


Select The Blank


Select The Blank




129
Select The Blank


of :-
Select The Blank

143(2) and section 143(3).

True/False
Correct Answer True
Your Answer True


the time of :-
130


Commission is :-


Your Answer Taxable
Select The Blank

Your Answer 20000

to be reinvested :-
Select The Blank

Correct Answer 10
Your Answer 10
True/False
Your Answer False
131
Select The Blank

Match The Following

True/False
Your Answer False
True/False
the employer.
Correct Answer True
Your Answer True
True/False
previous year.
Correct Answer True
Your Answer True

132
True/False
Correct Answer True
Your Answer True
Match The Following

for the A Y 2005-2006. RS.12,500 RS.12,500


True/False
Correct Answer True
Your Answer False

133
True/False
Your Answer True
True/False
Correct Answer True
Your Answer True

source :-
Your Answer Central or State Government , Any Local Authority , Any Trust
Select The Blank

Correct Answer 8
Your Answer 8
Select The Blank

Correct Answer 0.35
Your Answer 0.4
True/False
Correct Answer True
Your Answer True


134



Question Working partner is a partner who :-
Correct Answer Frames business policies , Takes business decisions , Attends general
administration
Your Answer Frames business policies , Takes business decisions , Attends general administration

Question Following situations are treated as change in constitution of partnership firm:-
Correct Answer Change of profit sharing ratio , Addition of new partner , Resignation of existing
partner
Your Answer Change of profit sharing ratio , Addition of new partner , Introduction of additional capital

Select The Blank

True/False
Correct Answer True
Your Answer True
135
True/False
Question Interest on housing loan is deductible from the year of acquisition / construction.
Correct Answer True
Your Answer True

True/False
Question Deduction u/s Section 80DD for Medical treatment of handicapped dependent is not
available to HUF
Your Answer False

Correct Answer Services of sweeper, gardener, watchman or personal attendant , Gas, electricity
and water provided for personal consumption , Motor Car
True/False
Question Refund of Income tax is taxable as Income from business or profession.
Your Answer True
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the form of motor car,
the wear and tear will be calculated @ ________ %.
Correct Answer 20
Your Answer 50

Select The Blank

136
Your Answer Issued
Select The Blank

Question Long term Capital Gains is taxed at ________.
Correct Answer 0.1
Your Answer 0.2

Select The Blank

Question If the employer provides the accommodation in a hotel (except where the employee is
provided such accommodation for a period of less than 15 days on his transfer from one place to another),
the perquisite will be considered to be equal to ________% of the salary or actual charges paid to the hotel,
whichever is less.
Correct Answer 24
Your Answer 24
True/False
Question Amount spent for training the employees and amount spent by the employer as fees for
sending the employee for the refresher courses (including the lodging and boarding expenses incurred by
the employee) is exempt from tax.
Correct Answer True
Your Answer True

Question Section 269T does not apply to the repayment of any loan or deposit taken or accepted
from :-
Correct Answer Any government company , Any banking or cooperative bank , Any corporation
established by the central or state Act
Your Answer Any government company , Any banking or cooperative bank , Any corporation
established by the central or state Act

Question While calculating the tax liability of an assessee, certain deductions are permissible as per
the provisions of Chapter VI-A of the Act. These amounts are deducted from :-
Match The Following

137
u/s 37 u/s 37
Select The Blank

Your Answer 20000
True/False
Question Political party may loose its exemption if it fails to maintain record of all voluntary
contributions in excess of Rs 10000/-.
Correct Answer True
Your Answer True

Question The amount of capital gains not invested by the assessee for the purchase or construction
of the new property can be deposited by the assessee under the Capital Gains Account Scheme :-
Correct Answer Before the date of filing his return of income
Your Answer Before the date of filing his return of income

Your Answer 15000


138

Question Remuneration received by a University Teacher received from his college will be treated
as his salary. However, if he receives some honorarium for setting and correcting the question papers from
the University :-
Correct Answer Honorarium will be treated as Income from other sources
Your Answer Honorarium will be treated as Income from other sources

Question Mr. X an employee of the Central Government receives Rs 3,50,000 as gratuity at the
time of his retirement on September, 2004 under new pension code, the total taxable income will be :-
Correct Answer Nil
Your Answer Nil

Question Rebate is allowed on any subscription made to the notified deposit scheme, interest on
which is not eligible for deduction under Section 80L of the Act :-
Correct Answer Of a housing finance company , Of any authority satisfying the needs of housing
Select The Blank

actually paid.
Correct Answer 1
Your Answer 2
Select The Blank

Select The Blank

Rs ________ is Nil u/s 88D.

Question A domestic company has following features :-
139
Correct Answer It is an Indian Co. , It can be any other Co. , Has made prescribed arrangements
for declaration and payment of dividend
Your Answer It is an Indian Co. , It can be any other Co. , Has made prescribed arrangements for
declaration and payment of dividend

property is :-
Your Answer Market value


Question The following relates to the head Income from Business of Profession
Correct Answer Unabsorbed Depreciation , Unabsorbed Business loss
Your Answer Unabsorbed Depreciation , Unabsorbed Business loss
True/False
Question Tea or other non-alcoholic beverages and snacks (in the form of light refreshments)
provided during the office hours are chargeable in the hands of the employee..
Your Answer False
Match The Following

Statutory Provident Fund This is set up as per the provisions of Provident Fund Act, 1925. Rebate
U/s 88D allowed.
140

Your Answer Principal portion of borrowed capital , Standard deduction , Interest on borrowed capital
Select The Blank

Rs.________.
Your Answer 300000

Question If firm fails to submit copy of deed along with return of income :-
Your Answer It will still be treated as a firm
True/False
Correct Answer True
Your Answer False

Question During the current Assessment Year, Mr. A bought 1000 Equity Shares of A Ltd., a
company manufacturing paper, which had issued 10,00,000 Equity Shares of Rs. 10 each. What is the
rebate available for such investment?
Your Answer Rebate will be available u/s 88D

Your Answer Purchase of Building , Purchase of machinery
Select The Blank

Question If the self occupied property is constructed or acquired with the borrowed capital before
01.04.1999 maximum deduction will be ________.
Correct Answer Rs 30000/-
Your Answer Rs 150000/-
141

that he avails the exemption of LTC in the fourth calendar year of the next block i.e. 2005.

Your Answer Cheque

True/False
head of income.
Correct Answer True
Your Answer True

Your Answer If the debentures are issued by a widely held company and the debentures are listed on a
stock exchange and if the amount of interest does not exceed Rs. 2,500 during the financial year. , If the
interest paid is on State or Central Government Securities , If the debentures are issued by an institution,
authority, Public Sector Company or cooperative society as the Central Government may notify.
Select The Blank

Question Belated return can be filed at any time before the expiry of one year from the end of the
relevant ________ or before the completion of assessment, whichever is earlier.
Your Answer Previous

142

Your Answer Deduction can be for principal portion also , Borrowal is after 1st April 1999 , Construction
is completed in 3 years
Select The Blank

143(2) and section 143(3).
Select The Blank

Correct Answer None
Your Answer Not applicable

Your Answer The provision has been made for the payment of a sum by way of contribution to an
approval gratuity , The amount of gratuity has actually become payable to the employees during the
previous year
Select The Blank

Correct Answer 182
Your Answer 180
Select The Blank

Match The Following

depreciation is 40%
143

Question Deduction from Gross Total Income in respect of payment of Medical Insurance Premium
is available under Section :-
Correct Answer Section 80D
Your Answer Section 80D

Your Answer Net annual value

Your Answer Developing, maintaining or operating any infrastructure facility where the term
Select The Blank

Question If the CC of the engine is less than 1.6 liters and the motor car is owned or hired by the
Correct Answer 400
Your Answer 400
True/False
Question If the amount of tax payable by the assessee is higher than the combined amount of tax
deducted at source and advance tax, such tax along with the amount of interest payable should be paid by
the assessee at the time of filing the return of income
Correct Answer True
Your Answer True
144
True/False
Your Answer False
Select The Blank

True/False
Your Answer False

Your Answer Income from supply of water & electricity with in its jurisdiction
True/False
the shareholder.
Your Answer False

Match The Following


145

Select The Blank

True/False
Question Income tax paid is allowed as deduction while calculating profit from business or
profession.
Your Answer True
True/False
Correct Answer True
Your Answer True
Select The Blank

Select The Blank

Your Answer Workers compensation.

Question The rebates under the Income Tax Act are available only if :-
Correct Answer The payment is made during year
Your Answer The payment is made in the previous year
146
True/False
Question Entertainment Allowance is available for deduction only for the Government Employees.
Correct Answer True
Your Answer False
Select The Blank



national for services rendered outside India , Income from any capital asset situated outside India
Select The Blank


Question Any loans or deposits borrowed or repaid under section 269SS of the Act provides that
the said provisions will not apply to the loans or deposits accepted by :-
Correct Answer Government , Government company , Banking company including cooperative
bank and post office savings bank
Your Answer Government , Government company , Banking company including cooperative bank and
post office savings bank

Question What is a Keyman Insurance Policy?
Correct Answer Policy taken by a person (usually employer) on the life of another person (usually
a senior employee) where the employee pays a key role in the organization of the employer
Your Answer Policy taken by a person (usually employer) on the life of another person (usually a senior
employee) where the employee pays a key role in the organization of the employer
147

Select The Blank

Rs.________.
Your Answer 300000

:-
Correct Answer 0.3
Your Answer 0.3


True/False
Your Answer True
True/False
Correct Answer True
Your Answer True

148

Select The Blank




Select The Blank

Question If assessee owns more than one house properties, he can get benefit of nil annual value
for any one house property ________.



149

True/False
Your Answer False

Select The Blank

Correct Answer 182
Your Answer 182
True/False
Correct Answer True
Your Answer False


Question The amount of advance tax payable by non corporate assessees before 15th March of
Previous year is :-

March, 2005
150
provided that such research is related to his business , The assesse is a company engaged in the business
of bio-technology or any other notified product a weighted deduction of 150% is allowed in respect of in-
Select The Blank

Your Answer Issued
True/False
Your Answer False

Your Answer Employee's contribution to PF is exempt from tax , Interest on employee's contribution is
taxable as "Income from Other Sources"
Select The Blank

Match The Following
True/False
151
holding period.
Your Answer True
True/False
as deduction.
Your Answer False
Select The Blank

True/False
Correct Answer True
Your Answer True


Select The Blank

143(2) and section 143(3).

Match The Following

152
employee

Any allowance granted to meet the cost of travel on tour or on transfer of duty.
Select The Blank

Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax rebate of



True/False
Your Answer False

153
institution, authority, Public Sector Company or co-operative society as the Central Government may notify.
Your Answer If the interest paid is on State or Central Government Securities , If the debentures are
issued by a widely held company and the debentures are listed on a stock exchange and if the amount of
Select The Blank

Your Answer Company


Your Answer Developing, maintaining or operating an industrial park or special economic zones notified
by the Central Government , Generation or distribution of power , Developing, maintaining or operating any
infrastructure facility where the term infrastructure facility means a road (including a toll road, a bridge or a
rail system) or a highway project or a water supply project.
True/False
Your Answer False


154
to be reinvested :-
True/False
Your Answer False

Question The total amount of rebates under Section 88, Section 88B, Section 88C and Section 88D
True/False
Your Answer False

Your Answer 80 G Donations , 80 HHB profits and gains from projects outside India , 80 IA profits and
True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the company carried out,
the report of such audit should be enclosed to the Tax Audit Report.
Correct Answer True
Your Answer True
Match The Following
u/s 37 u/s 37
155

Question In case of any contribution made by an individual or a HUF to notified units of any
approved mutual fund or of Unit Trust of India in accordance with a notified scheme (Equity Linked Savings
Scheme) :-
True/False
Correct Answer True
Your Answer True

Question What is the treatment of principal amount of loan borrowed for the purchase or
construction of a residential house?
True/False
Correct Answer True
Your Answer True

True/False
Question Deductions available as per the provisions of Chapter VI of the Act are not available for
the long-term capital gains.
Correct Answer True
Your Answer True
True/False
ordinary resident
Correct Answer True
Your Answer True

156

HRA received by the employee.
Select The Blank

Correct Answer 600
Your Answer 600

Commission is :-


Correct Answer 0.1
Your Answer 0.1
Select The Blank

Correct Answer 0.35
Your Answer 0.2
True/False
tax Paid
Your Answer True

157


True/False
the shareholder.
Your Answer False
Select The Blank


Question Section 35D applies to the preliminary expenses incurred by a company, which consists
of :-
Correct Answer Expenditure in connection with the preparation of feasibility/project report,
engineering services, or conducting market survey , Legal charges and fees for registering the company as
per the provisions of company Act, 1956 , Charges in connection with drafting and printing of memorandum
of association and Articles of Association
Your Answer Expenditure in connection with the preparation of feasibility/project report, engineering

Your Answer Motor Car , Gas, electricity and water provided for personal consumption , Amount spent
on training of employees or fees paid for refresher management course
Select The Blank

158

the payee.
True/False
reimbursed by the employer is exempt from tax.
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

Question The amount of advance tax payable by corporate assessees before 15th September of
Previous year is :-

Question As per which provision and section, every person, company or any other person shall
Select The Blank


Question The return of income is required to be filed by all the companies, except those covered
under section 25 of the companies Act,1956 in the :-
Match The Following
159

Select The Blank



Taxation-Saroj2
Select The Blank

Correct Answer 182

Your Answer 182

160



Select The Blank

88C of the IT Act.

Your Answer Nil


Your Answer The person who is director of a company , The employee who has substantial interest in the
company by having 20% or more of the voting power , The employee whose income under the head

True/False

Your Answer False
True/False
161
Correct Answer True

Your Answer True

Match The Following

Uncommuted Pension Indicates the periodical payment of pension Indicates the periodical payment of
pension
Commuted Pension Indicates the lump sum received in lieu of the periodical Indicates the lump sum
received in lieu of the periodical
True/False

Your Answer True

Select The Blank

162
Correct Answer 8
Your Answer 3



Your Answer Exempt
Match The Following

By an individual or a HUF is eligible for rebate u/s 88 By an individual or a HUF is eligible for rebate u/s
88
for the A Y 2005-2006.
RS.12,500 RS.12,500
during the said Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000
Select The Blank

Select The Blank

163
Correct Answer None

Your Answer Any one

Select The Blank

Correct Answer 15
Your Answer 15
Select The Blank

________.
Select The Blank

Your Answer Persons



True/False
term capital gains.
Correct Answer True

Your Answer True
Select The Blank

164


residential house?



Previous year is :-
Select The Blank

________ is Nil u/s 88D.

True/False
Correct Answer True

Your Answer True
165
True/False
Your Answer False


Select The Blank

Correct Answer 65
Your Answer 65

True/False
year.
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

166

year is :-
Correct Answer Nil

True/False
Correct Answer True
Your Answer True
True/False

Your Answer True


True/False
Your Answer False
167


Select The Blank

True/False
Correct Answer True
Your Answer True


True/False
Correct Answer True
Your Answer True

respect of
168


Select The Blank

Correct Answer 182
Your Answer 182


Select The Blank


169
Select The Blank




Select The Blank


of :-
Select The Blank

143(2) and section 143(3).

170
True/False
Correct Answer True
Your Answer True


the time of :-


Commission is :-


Your Answer Taxable
171
Select The Blank

Your Answer 20000

to be reinvested :-
Select The Blank

Correct Answer 10
Your Answer 10
True/False
Your Answer False
Select The Blank

Match The Following

True/False
172
Your Answer False
True/False
the employer.
Correct Answer True
Your Answer True
True/False
previous year.
Correct Answer True
Your Answer True

True/False
Correct Answer True
Your Answer True
Match The Following

for the A Y 2005-2006. RS.12,500 RS.12,500
173


True/False
Correct Answer True
Your Answer False

True/False
Your Answer False


174

Select The Blank

True/False
Correct Answer True
Your Answer True


True/False
Correct Answer True
Your Answer True

respect of

175

Select The Blank

Correct Answer 182
Your Answer 182


Select The Blank


Select The Blank


176



Select The Blank


of :-
Select The Blank

143(2) and section 143(3).

True/False
Correct Answer True
Your Answer True
177


the time of :-


Commission is :-


Your Answer Taxable
Select The Blank

Your Answer 20000

to be reinvested :-
178
Select The Blank

Correct Answer 10
Your Answer 10
True/False
Your Answer False
Select The Blank

Match The Following

True/False
Your Answer False
True/False
the employer.
179
Correct Answer True

Your Answer True
True/False
previous year.
Correct Answer True
Your Answer True

True/False
Correct Answer True
Your Answer True
Match The Following

for the A Y 2005-2006. RS.12,500 RS.12,500


180
True/False
Correct Answer True
Your Answer False
Taxation
-------------
Select The Blank

Question The basic advantage of having an agent in the export market is ________.
Correct Answer He is knowledgeable of the marketing condition
Your Answer He is knowledgeable of the marketing condition

Question How does the customer know about the product & is influenced to buy it?
Correct Answer Publicity , Advertising , Sales promotion
Your Answer Publicity , Advertising , Sales promotion

Question Which of the following is not included in foreign environment?
Correct Answer Local dimension
Your Answer Local dimension

Question Why should a market researcher check a country's import tariffs when he is investigating it as an
export market?
Correct Answer It can affect the competitiveness of product against products made within the market
Your Answer It can affect the competitiveness of product against products made within the market

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". What are the distribution
channels used for imports of silk products into USA market?
Correct Answer Merchant intermediaries , Departmental stores
Your Answer Merchant intermediaries , Departmental stores
True/False
Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Oriental entered the US market
in 1970 with a moderate export of Rs.20 million.
Your Answer False
Match The Following

Indirect exporting Home-based merchant Copyright

181
Business dimensions Channel network Channel network
Legal dimensions Copyright Use of patent
Licensing arrangement Use of patent Home-based merchant

Question What is important to take pricing decision?
Correct Answer Competition
Your Answer Competition
Select The Blank

Question In ________, the firm faces only one set of customers.
Correct Answer Domestic marketing
Your Answer Domestic marketing

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Oriental was an active member
of some councils, which are those?
Correct Answer Apparel Export Promotion Council , Woolen Export Promotion Council
Your Answer Apparel Export Promotion Council , Woolen Export Promotion Council

Question This question is based on the case study 'AB Enterprises'. What is the problem in adapting AB
Enterprises product in the market?
Correct Answer Novelty is lost due to ethnic character in AB Enterprises
Your Answer Novelty is lost due to ethnic character in AB Enterprises

Question What are the important infrastructure factors in evaluating production site?
Correct Answer Industrial site , Transportation & communication
Your Answer Industrial site , Transportation & communication

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Which are the two years the
imports of silk fabrics from Japan by USA was almost same?
Correct Answer 1982 , 1983
Select The Blank

Question ________dimensions include customs and practices
Correct Answer Business
Your Answer Business

Question What is the nature of direct export market?
Correct Answer Concentrated , Large potential sale
Your Answer Concentrated , Large potential sale
182

Question What does product-mix decision include?
Correct Answer Packaging
Your Answer Packaging

Question What are the internal sources of information?
Correct Answer Sales record , Correspondence from salesmen
Your Answer Sales record , Correspondence from salesmen
True/False
Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Mr.Patnaik felt that it was high
time that he appraises his agents' performance relating to the vast & expanding US market.
Correct Answer True
Your Answer True

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". What were the options
Mr.Patnaik had to operate in the US market?
Correct Answer Opening a branch office , A subsidiary company
Your Answer Opening a branch office , A subsidiary company
Select The Blank

Question In indirect export channel, the market is ________.
Correct Answer Dispersed
Your Answer Dispersed
True/False
Question Strategies suggested in the Medium Term Export Plan include product-market penetration strategy
for existing products, product-market, diversification for new products & new markets.
Correct Answer True
Your Answer True

Question Why is packaging so important for product planning?
Correct Answer As it enhances protection , As it gives shelf life for a product
Your Answer As it enhances protection , As it gives shelf life for a product
True/False
Question If foreign retailers are used, the products in question are industrial products rather than consumer
products.
Your Answer True

Question How is the nature of international strategy?
Correct Answer Depends on company's objectives , Varies from country to country
Your Answer Depends on company's objectives , Varies from country to country
Select The Blank

Question "make site booking" is a point of checklist of ________
183
Correct Answer Before the fair

Your Answer Before the fair

Question What marketing technique is used to know international marketing need?
Correct Answer Marketing information & research
Your Answer Marketing information & research

Question What are the benefits of participation in trade fair?
Correct Answer To get to know about competition , To know about the extent of product adaption
Your Answer To get to know about competition , To know about the extent of product adaption
Select The Blank

Question Experience survey, which is also called as ________.
Correct Answer Key informant survey
Your Answer Key informant survey

Question What is a foreign agent?
Correct Answer Independent middleman
Your Answer Independent middleman

Question What does political environment include?
Correct Answer Legal dimension
Your Answer Legal dimension
Match The Following

External factor Competitive profile Competitive profile
Ethnocentric orientation Overseas operation conducted from home country Overseas operation conducted
from home country
Polycentric orientation Each market is unique Each market is unique
Target market Marketing strategy Marketing strategy
True/False
Question In marginal cost pricing for export, competition in foreign markets requires quotation of a lower
price
Correct Answer True
Your Answer True
True/False
Question Policies or regulations regarding quality control & inspection vary considerably between nations.
Correct Answer True
Your Answer True
184
Select The Blank

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". Oriental Silk Private Limited, is a
________ unit, was one of the leading Indian manufacturers & exporters of silk fabrics & made-ups
Correct Answer 100% export oriented
Your Answer 100% export oriented
Select The Blank

Question This question is based on the case study "Oriental Silk Pvt. Ltd.". The bulk of the trade was
handled by ________
Correct Answer Central buying organizations
Your Answer Foreign agents
True/False
Question If business is variable, the company will choose the purchasing or subcontracting alternatives.
Correct Answer True
Your Answer True

Question What is the meaning of offshore purchasing?
Correct Answer Relationship between independent buyer & seller for exchange of good for money
Your Answer Relationship between independent buyer & seller for exchange of good for money
Select The Blank

Question Many companies modify their products/promotion strategies to suit ________ of the population of
the different countries.
Correct Answer Tastes & preferences
Your Answer Tastes & preferences
True/False
Question Companies with smaller needs, an independent supplier will be less active.
Your Answer False
True/False
Question Catalogues contain a list of all competitors with product details.
Your Answer False

Question What is correct according to geocentric orientation?
Correct Answer Companies view the entire world as a single market , Uniform inventory management &
training
Your Answer Companies view the entire world as a single market , Uniform inventory management &
training
True/False
Question The area of change relates to product adaption requires upgradation of technology and huge
investment in brands.
Correct Answer True
Your Answer True
185
Select The Blank

Question This question is based on the case study "Chow Flowers Co. Ltd.". ________ was Thailand's
second largest export market for artificial flowers, mostly polyester or hand-wrapped.
Correct Answer Canada
Your Answer Canada

Question What are the similarities between domestic & international marketing?
Correct Answer Satisfying consumers need
Your Answer Satisfying consumers need

Question What is the need of marketing research for export-import trade?
Correct Answer To reduce the distance between an exporter & his customers in terms of marketing
Your Answer To reduce the distance between an exporter & his customers in terms of marketing

Question What is the avenue of entry into foreign markets?
Correct Answer Contract manufacturing
Your Answer Contract manufacturing

Question What is the principal functional division of ministry of commerce & industry?
Correct Answer Export Industries Division
Your Answer Export Industries Division
----------

Question What are the factors to be considered in cluster analysis?
Correct Answer Limited number of clusters due to limitation of market potential , Clusters are not water tight
compartment , Evaluating the quality of cluster is difficult
Your Answer Limited number of clusters due to limitation of market potential , Clusters are not water tight
compartment , Evaluating the quality of cluster is difficult

Question Clarity of questions and instructions for filling the form is essential in :-
Correct Answer Mail survey
Your Answer Data analysis

Question The technique through which objects/ cases are classified into relative homogeneous groups or
clusters is known as :-
Correct Answer Cluster analysis
Your Answer Cluster analysis

186
Question Mean or average value is used to estimate when data have been collected using :-
Correct Answer Interval or ratio scale
Your Answer Interval or ratio scale
Select The Blank

Question In ________ method the research analyst is not concerned with cause and research relationship.
Correct Answer Diagnostic
Your Answer Diagnostic

Question Which are the New Delhi based Research Institutions?
Correct Answer NRDC , CSIR , Cement Research Institute of India
Your Answer NRDC , CSIR , Cement Research Institute of India

Question Market Research is done to
Correct Answer Explore the Opportunities
Your Answer Explore the Opportunities
True/False
Question "Consumer Panel" is a specialized market research technique.
Your Answer False
Match The Following

"What might this be ?" Inkblot test Inkblot test
Aided Recall Depth Research Depth Research
Doesn’t intend to tell Projective techniques Projective techniques
Ease of construction Likert scale Likert scale
True/False
Question In regression analysis, dependent variables can be expressed as a linear function of impendent
variables.
Correct Answer True
Your Answer True
True/False
Question When company prepares a long range plan it is unpublished internal source of information.
Correct Answer True
Your Answer True
Select The Blank

Question Association technique is a type of ________.
Correct Answer Projective technique
Your Answer Projective technique
187

Question The impact of promotional slogans on the consumers can be studied with
Correct Answer Association technique
Your Answer Association technique
True/False
Question Brand image building is not important in case of industrial product for quality.
Your Answer False

Question Which publications are used for research on Chemical Industry?
Correct Answer Indian Chemical Directory , Chemical Industry News , Chemical & Petro Chemicals Journal
Your Answer Indian Chemical Directory , Chemical Industry News , Chemical & Petro Chemicals Journal

Question Spreading the sample through the entire population following a regular pattern is known as :-
Correct Answer Systematic sampling
Your Answer Systematic sampling
Select The Blank

Question In absence of proper________ the market research becomes a data collection exercise.
Correct Answer Problem Definition
Your Answer Analysis

Question Which institutions should be contacted for research on Paint Chemicals?
Correct Answer National Chemical Laboratory, Pune , Industrial Research & Development Center , Building
Research Institute
Your Answer National Chemical Laboratory, Pune , Industrial Research & Development Center , Building
Research Institute

Question The objectives of marketing research are
Correct Answer To understand the consumer needs and wants , To explore the new markets , To analyze
the competitors
Your Answer To understand the consumer needs and wants , To explore the new markets , To analyze the
competitors

Question Ultra violet ink is used to disguise customer coding. This activity is :-
Correct Answer A disapproved method
Your Answer A disapproved method
Select The Blank

Question Through cluster analysis objects/cases are classified into relatively________ group called cluster.
Correct Answer Homogeneous
Your Answer Homogeneous
Match The Following

188
Dangler POP POP
POP Communication medium Communication medium
Opinion Polls Daily basis Daily basis
Corporate Image Study Advertising research Advertising research

Question Ethical issues to be observed while writing a report are :-
Correct Answer No deliberate misinterpretations , Marketing problems should be designed to suit hidden
agenda , Complete confidentiality and secrecy of data
Your Answer No deliberate misinterpretations , Marketing problems should be designed to suit hidden
agenda , Complete confidentiality and secrecy of data
Select The Blank

Question Multiple Choice is a ________type of question.
Correct Answer Close ended
Your Answer Close ended

Question The conjoint analysis helps to enable company's to :-
Correct Answer Conduct brand swot analysis
Your Answer Conduct brand swot analysis

Question In the Internet era, qualitative research is possible through :-
Correct Answer Chat sessions
Your Answer Chat sessions
Select The Blank

Question ________is an important communication medium that helps recall advertising.
Correct Answer Point of Purchase(POP)items
Your Answer Point of Purchase(POP)items
True/False
Question In the Funnel approach, specific questions come first and general questions later.
Your Answer False

Question In resources for marketing research skilled staff plays an important role in :-
Correct Answer Maintaining data , Dealing with different situation and problems , Timely completion of
research
Your Answer Maintaining data , Dealing with different situation and problems , Timely completion of
research
Select The Blank

189
Question Convenience Sampling is used for ________.

Correct Answer Exploratory research
Your Answer Exploratory research
True/False
Question The person conducting pharma research should be well qualified so that not to waste Doctors
time.
Correct Answer True
Your Answer True
True/False
Question The limitations with regression forecasting is that independent variables must be forecasted before
forecasting the dependent variables.
Correct Answer True
Your Answer True

Question Main features of Technical Report are :-
Correct Answer Minute details of planning data collection , Analysis , Interpretation
Your Answer Minute details of planning data collection , Analysis , Interpretation

Question How people allocate their time and money to certain products and factors is depicted by
Correct Answer Psychographic Variable
Your Answer Psychographic Variable
True/False
Question Question phrasing and structure are eliminated in Semantic differential scale.
Correct Answer True
Your Answer True
True/False
Question The popularity of Likert scale is due to its ease of construction and administration.
Correct Answer True
Your Answer True

Question Which are the Export Promotion Councils?
Correct Answer Cashew Export Promotion Council , Handloom Export Promotion Council , Gem & Jewellery
Export Promotion Council
Your Answer Cashew Export Promotion Council , Handloom Export Promotion Council , Gem & Jewellery
Export Promotion Council
True/False
Question The written contract of a research should cover the penalty clause covering deficits such as
delays, inadequate data.
Correct Answer True
Your Answer True

190
Question The producers in the sellers' market are also forced to take decisions based on the market
information because
Correct Answer The resources are scarce
Your Answer The resources are scarce

Question Scale Intervals can be used for
Correct Answer Age
Your Answer Age
Select The Blank

Question Bibliography contains ________.
Correct Answer Information of references and secondary data
Your Answer Information of references and secondary data

Question Online survey methods include :-
Correct Answer Email survey , HTML survey , Downloadable interactive surveys
Your Answer Email survey , HTML survey , Downloadable interactive surveys

Question Data of market research cannot be maintained :-
Correct Answer Without experienced and educated research staff
Your Answer Without experienced and educated research staff

Question Pretesting of Questionnaire includes testing of :-
Correct Answer Question content , Time taken to answer questions , Categorisation
Your Answer Question content , Time taken to answer questions , Categorisation

Question Identification of Target Population is facilitated by :-
Correct Answer Well defined research objectives , Alternative, reasonable/target population definitions ,
Specifications for exclusion in target population
Your Answer Well defined research objectives , Alternative, reasonable/target population definitions ,
Specifications for exclusion in target population
Select The Blank

Question ________are used for National Panel Studies.
Correct Answer Quota controls
Your Answer Quota controls
Select The Blank

Question Finding out the number of vehicles at a given junction is a ________ method.
Correct Answer Direct Observation
Your Answer Direct Observation
191

Commission is :-
Select The Blank

True/False
Your Answer False

Correct Answer Statutory Provident Fund , Recognized Provident Fund , Unrecognized Provident
Fund
Your Answer Statutory Provident Fund , Recognized Provident Fund , Unrecognized Provident Fund



192
Select The Blank


Question The provisions under section 44AB of the Act, is applicable to the person carrying on the
profession and whose gross receipts in profession :-

Question As per the provision of section 143(2) and 143(3) scrutiny assessment made by assessing
officer in order to ensure that :-
Correct Answer Assessee has not understated the income , Assessee has not overstated the
Your Answer Assessee has not understated the income , Assessee has not overstated the loss ,
Assessee has under paid the taxes , Assessee has not been allotted the PAN

Your Answer Exempt
True/False
Question Interest paid on the loan for acquiring a capital asset will not be considered to be a part of
Your Answer True


193
Select The Blank


True/False
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

the time of :-


Correct Answer Government , Government company , Banking company including cooperative
bank and post office savings bank
194

Previous year is :-

True/False
Correct Answer True
Your Answer True

Question Which of the following expenses should be debited to P & L Account, but disallowed for
Income tax purpose?

Question The provisions regarding set off and carry forward of loses are contained in :-


of :-
Select The Blank

195


Your Answer The individual himself , A minor of whom he is the guardian. , Spouse of individual
True/False
Correct Answer True
Your Answer True

Question Following news agencies are specified by the Central Government as specified news
agencies :-
Correct Answer UNI , PTI
Your Answer PTI , NDTV
Select The Blank

True/False
Correct Answer True
Your Answer True
Match The Following

196
Select The Blank

Your Answer 20000
Select The Blank

Question Mr. Ram is employed by the Central Government as accountant whose gross salary
income is Rs 6,00,000. He can claim standard deduction of Rs ________ u/s 16(i) of the IT Act.
Match The Following

True/False
Question The consideration for transfer of Capital Asset is received by the transferor is not material
while Capital gain chargeable to tax.
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

Scheme) :-
Your Answer Qualifies for tax rebate under section 88D.
197
True/False
the shareholder.
Your Answer False
Select The Blank

Question Loss from the activity of owning and maintaining the race horses can be carried forward
and set off in the subsequent Assessment Years subject to the limit of ________ Assessment years.
Correct Answer 4
Your Answer 4
Select The Blank

Question If the property becomes the property of the assessee before ________, the Fair Market
Value of the property of the capital asset on that date will be considered to be the cost of acquisition
Select The Blank

Correct Answer 182
Your Answer 182
Select The Blank

Question After deducting interest on capital & remuneration to partners, firm is required to pay tax
@ ________


198
True/False
Your Answer False


Select The Blank

True/False
Correct Answer True
Your Answer True


True/False
Correct Answer True
Your Answer True
199

respect of


Select The Blank

Correct Answer 182
Your Answer 182


Select The Blank


Select The Blank

200



Select The Blank


of :-
Select The Blank

143(2) and section 143(3).

True/False
Correct Answer True
Your Answer True

201

the time of :-


Commission is :-


Your Answer Taxable
Select The Blank

Your Answer 20000

to be reinvested :-
Select The Blank

Correct Answer 10
Your Answer 10
True/False
202

Your Answer False
Select The Blank

Match The Following

True/False
Your Answer False
True/False
the employer.
Correct Answer True
Your Answer True
True/False
previous year.
Correct Answer True
Your Answer True

True/False
203
Correct Answer True
Your Answer True
Match The Following

for the A Y 2005-2006. RS.12,500 RS.12,500


True/False
Correct Answer True
Your Answer False

204
True/False
Your Answer False


Select The Blank

True/False
Correct Answer True
Your Answer True


True/False
Correct Answer True
Your Answer True

respect of
205


Select The Blank

Correct Answer 182
Your Answer 182


Select The Blank


Select The Blank


206



Select The Blank


of :-
Select The Blank

143(2) and section 143(3).

True/False
Correct Answer True
Your Answer True

207

the time of :-


Commission is :-


Your Answer Taxable
Select The Blank

Your Answer 20000

to be reinvested :-
Select The Blank

Correct Answer 10
Your Answer 10
True/False
Your Answer False
Select The Blank

208

Match The Following

True/False
Your Answer False
True/False
the employer.
Correct Answer True
Your Answer True
True/False
previous year.
Correct Answer True
Your Answer True

True/False
Correct Answer True
Your Answer True
Match The Following

209
for the A Y 2005-2006. RS.12,500 RS.12,500


True/False
Correct Answer True
Your Answer False


210
True/False
Your Answer False


to be reinvested :-
True/False
Your Answer False

True/False
Your Answer False

True/False
Correct Answer True
Your Answer True
211
Match The Following

u/s 37 u/s 37

Scheme) :-
True/False
Correct Answer True
Your Answer True

True/False
longterm capital gains.
Correct Answer True
Your Answer True

True/False
Correct Answer True
Your Answer True
212
True/False
ordinary resident
Correct Answer True
Your Answer True


Select The Blank

Correct Answer 600
Your Answer 600

Commission is :-


Correct Answer 0.1
Your Answer 0.1
Select The Blank

Correct Answer 0.35
Your Answer 0.2
213
True/False
tax Paid
Your Answer True



True/False
the shareholder.
Your Answer False
Select The Blank


of :-

214
Select The Blank


the payee.
True/False
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

Previous year is :-

Select The Blank


215

Match The Following


Select The Blank



Taxation-Saroj2
Select The Blank

Correct Answer 182
Your Answer 182

216


Select The Blank

88C of the IT Act.
Your Answer Nil


Your Answer The person who is director of a company , The employee who has substantial interest in the
company by having 20% or more of the voting power , The employee whose income under the head

True/False
Your Answer False
True/False
Correct Answer True
Your Answer True
217

Match The Following

Uncommuted Pension Indicates the periodical payment of pension Indicates the periodical payment of
pension
Commuted Pension Indicates the lump sum received in lieu of the periodical Indicates the lump sum
received in lieu of the periodical
True/False
Your Answer True

Select The Blank

Correct Answer 8
Your Answer 3


218

Your Answer Exempt
Match The Following

By an individual or a HUF is eligible for rebate u/s 88 By an individual or a HUF is eligible for rebate u/s
88
for the A Y 2005-2006.
RS.12,500 RS.12,500
during the said Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000

Select The Blank

Select The Blank

Correct Answer None
Your Answer Any one

Select The Blank

Correct Answer 15
Your Answer 15
Select The Blank

________.
219
Select The Blank

Your Answer Persons


True/False
term capital gains.
Correct Answer True
Your Answer True
Select The Blank


residential house?


220

Previous year is :-
Select The Blank

________ is Nil u/s 88D.
True/False
Correct Answer True
Your Answer True
True/False
Your Answer False


Select The Blank

Correct Answer 65
Your Answer 65

221
True/False
year.
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True


year is :-
Correct Answer Nil

True/False
Correct Answer True
Your Answer True
True/False
Your Answer True

Select The Blank

Rs.________.
222

Your Answer 300000

:-
Correct Answer 0.3
Your Answer 0.3


True/False
Your Answer True
True/False
Correct Answer True
Your Answer True

Select The Blank


223


Select The Blank





True/False
Your Answer False

224
Select The Blank

Correct Answer 182
Your Answer 182
True/False
Correct Answer True
Your Answer False


Previous year is :-

March, 2005
Select The Blank

Your Answer Issued
True/False
Your Answer False

225

Select The Blank

Match The Following

True/False
holding period.
Your Answer True
True/False
as deduction.
Your Answer False
Select The Blank

True/False
Correct Answer True
Your Answer True
226


Select The Blank

143(2) and section 143(3).

Match The Following

employee

Select The Blank


227


True/False
Your Answer False

, If the interest paid is on State or Central Government Securities, If the debentures are issued by an
Select The Blank

Your Answer Company


228
True/False
Your Answer False


to be reinvested :-
True/False
Your Answer False

True/False
Your Answer False

True/False
229
Correct Answer True
Your Answer True
Match The Following
u/s 37 u/s 37

Scheme) :-
True/False
Correct Answer True
Your Answer True

True/False
Correct Answer True

Your Answer True

230
True/False
Correct Answer True
Your Answer True
True/False
ordinary resident
Correct Answer True
Your Answer True


Select The Blank

Correct Answer 600
Your Answer 600

Commission is :-

231

Correct Answer 0.1
Your Answer 0.1
Select The Blank

Correct Answer 0.35
Your Answer 0.2
True/False
tax Paid
Your Answer True



True/False
the shareholder.
Your Answer False
Select The Blank


of :-
232

Select The Blank


the payee.
True/False
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

Previous year is :-

233
Select The Blank


Match The Following

Select The Blank



234



True/False
Your Answer False


to be reinvested :-
True/False
Your Answer False
235

True/False
Your Answer False

True/False
Correct Answer True
Your Answer True
Match The Following
u/s 37 u/s 37

Scheme) :-
True/False
236
Correct Answer True
Your Answer True

True/False
Correct Answer True

Your Answer True

True/False
Correct Answer True
Your Answer True
True/False
ordinary resident
Correct Answer True
Your Answer True


237
Select The Blank

Correct Answer 600
Your Answer 600

Commission is :-


Correct Answer 0.1
Your Answer 0.1
Select The Blank

Correct Answer 0.35
Your Answer 0.2
True/False
tax Paid
Your Answer True



238

True/False
the shareholder.
Your Answer False
Select The Blank


of :-

Select The Blank


the payee.
True/False
239
Correct Answer True

Your Answer True
True/False
Correct Answer True
Your Answer True

Previous year is :-

Select The Blank


Match The Following

240

Select The Blank



Select The Blank

Rs.________.
Your Answer 300000

:-
Correct Answer 0.3
Your Answer 0.3

241

True/False
Your Answer True
True/False
Correct Answer True
Your Answer True

Select The Blank




Select The Blank

242




True/False
Your Answer False

Select The Blank

Correct Answer 182
Your Answer 182
True/False
Correct Answer True
Your Answer False

243


Previous year is :-

March, 2005
Select The Blank

Your Answer Issued
True/False
Your Answer False

Select The Blank

244
Match The Following
True/False
holding period.
Your Answer True
True/False
as deduction.
Your Answer False
Select The Blank

True/False
Correct Answer True
Your Answer True


245
Select The Blank

143(2) and section 143(3).

Match The Following
employee

Select The Blank


246


True/False
Your Answer False

Select The Blank

Your Answer Company

Correct Answer Generation or distribution of power , Developing, maintaining or
operating any infrastructure facility where the term infrastructure facility means a road (including a toll road,
a bridge or a rail system) or a highway project or a water supply project. , Developing, maintaining or
operating an industrial park or special economic zones notified by the Central Government
Your Answer Developing, maintaining or operating any infrastructure facility where the term
Select The Blank

247
Question If the property becomes the property of the assessee before ________, the Fair
Market Value of the property of the capital asset on that date will be considered to be the cost of acquisition
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the form of
motor car, the wear and tear will be calculated @ ________ %.
Correct Answer 20
Your Answer 20

Correct Answer Statutory Provident Fund , Recognized Provident Fund , Unrecognized
Provident Fund
Your Answer Statutory Provident Fund , Recognized Provident Fund , Unrecognized Provident
Fund
Select The Blank

Your Answer 0.1

Question Income from other sources covers agricultural income from land situated :-
Your Answer In India


Question In case of any contribution made by an individual or a HUF to notified units of
any approved mutual fund or of Unit Trust of India in accordance with a notified scheme (Equity Linked
Savings Scheme) :-
True/False
Question Any advance tax paid before 31st March is treated as advance tax paid during
the previous year.
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Question If sum received is net of TDS then it is ________ to include in income from other
sources.
248


Question The person responsible for paying to any person any income by way of winnings
from lotteries or crossword puzzles or card games or games of any kind shall be required to deduct the tax ,
at the time of making the payment. However, no tax is required to be deducted if the amount of payment
does not exceed :-

Question The exemption for Leave travel Concession u/s 10(5)is available in respect of
how many children Born after 1st October 1998?
Your Answer Only 1
Match The Following

for the A Y 2005-2006. RS.12,500 Is eligible for rebate u/s 88D
during the said Assessment Year. her tax liabilit is Rs. 1,000 RS.12,500


Question Income from winning from lotteries / crossword puzzles/ horse races is taxed at
flat rate of :-
Correct Answer 0.3
Your Answer 0.35

249


Correct Answer Legal heir of deceased person , Parents of minor assessee , Agent of
NRI

Correct Answer Salary earned in India even if paid outside India , Salary paid by
Government to Indian national for services rendered outside India , Tax deducted in India
Your Answer Salary earned in India even if paid outside India , Salary paid by Government to
Select The Blank

Question Free meals provided by the employer during the office hours provided that the
value per meal does not exceed Rs. ________.
Correct Answer 50
Your Answer 50
Select The Blank

Correct Answer None
Your Answer None

Question Deduction in respect of Contribution to certain pension funds is related to :-
True/False
Question If a person is required to quote the PAN and he quotes or intimates a false
number then he may be liable to pay a penalty of Rs. 25000.
Correct Answer FALSE
Your Answer TRUE

250
Select The Blank

Question It should be noted that the tax liability of an individual having the total income of
less than Rs ________ is Nil u/s 88D.

Question What is the due date for filing Annual return for TDS from payment of interest?
True/False
Question If the capital asset becomes the property of the assessee by virtue of gift or will,
the period for which the capital asset is held by the previous owner should be excluded while deciding the
holding period.
Your Answer TRUE

Question Deduction from Capital Gains from the transfer of residential house property

Question Any amount paid by an individual as tuition fees to any educational institution in
India for the purpose of full time education of the individual's children. The maximum allowable limit is :-
Correct Answer Rs. 12,000 per child per annum , Subject to the maximum of two
children.
Your Answer Rs. 12,000 per child per annum , Subject to the maximum of two children.

Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of various payments
are allowed as deductions only if they are actually paid but, where if the assessee follows the ________, the
251

Question Value at which house property is offered for taxation under the head income from
house property is :-
Select The Blank

Select The Blank

Question The basic requirement of section 37 is that the expenditure should have been
incurred by the assessee ________ for the purpose of business.
Your Answer Other than
True/False
Question Income of a mutual fund is taxable even if it is authorized by RBI.
Your Answer FALSE

Correct Answer Policy taken by a person (usually employer) on the life of another
person (usually a senior employee) where the employee pays a key role in the organization of the employer
Your Answer Policy taken by a person (usually employer) on the life of another person (usually
Match The Following

Superannuation Fund It is an employee welfare scheme No exemption Available .
Statutory Provident Fund This is set up as per the provisions of Provident Fund Act, 1925. It is an
employee welfare scheme
Provisions Act, 1952 apply to this fund. This is set up as per the provisions of Provident Fund Act,
1925.
True/False
Question The amount of expenses including membership fees and annual fees incurred by
the employee on credit card and which are paid by the employer shall be added as the perquisites unless
Correct Answer TRUE
252
Your Answer TRUE

Question In case the assessee is not a company, a person(other than a company) who is
falling under One by Six economic criteria, the last date for filing the return is prescribed as :-

Your Answer Municipal value
Question In case of Payment of Interest on Securities no tax is required to be deducted

under the following circumstances :-
debentures are listed on a stock exchange and if the amount of interest does not exceed Rs. 2,500 during
the financial year. , If the interest paid is on State or Central Government Securities , If the debentures are
issued by an institution, authority, Public Sector Company or co-operative society as the Central
Your Answer If the interest paid is on State or Central Government Securities , If the
debentures are issued by an institution, authority, Public Sector Company or co-operative society as the
Central Government may notify. , If the debentures are issued by a widely held company and the
debentures are listed on a stock exchange and if the amount of interest does not exceed Rs.5,000 during
the financial year.
True/False
Question The consideration for transfer of Capital Asset is received by the transferor is not
material while Capital gain chargeable to tax.
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Question Expenditure incurred in connection with the local festivals like Diwali etc. are
________ as business expenditure.
Your Answer Allowed at assessing officers choice

253

True/False
Question If the debentures are converted into shares, it is considered to be transfer of the
capital asset.
Your Answer FALSE
True/False
Question Any expenditure incurred for earning the income which is included under the
head income from other sources will be allowed as deduction from such income provided that certain
conditions are satisfied
Correct Answer TRUE
Your Answer TRUE
VV - 2ND TAXATION

Question In case of the individual or HUF whose Gross Total Income, before deductions

Question Any amount received by the assessee under a Keyman Insurance Policy
including the bonus on such policy is :-
Correct Answer Taxable under the head salaries
Your Answer Taxable under the head income from other sources
254
True/False
Question The value of benefit resulting from the payment made by the employer in a club
for any expenditure incurred by the employee shall be taken as perquisites unless the said expenses are
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Question Deduction for remuneration from foreign sources for professors, teachers etc
under Section 80R is limited to ________% of such remuneration brought in India.
Correct Answer 15
Your Answer 15

Question The least of the following is the exemption available to an employee if he is in
receipt of house rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in Mumbai,
Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is situated at any other place. ,
Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the Salary.
Your Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata,
Select The Blank

Question For an individual as a citizen of India who leaves India in the relevant previous
year for the purpose of employment has to be in India for ________ days or more during previous year.
Correct Answer 182
Your Answer 182

True/False
Question If the defective return filed under section 139(9) is not rectified within 15 days,
the return filed by the assesee shall be considered invalid and it will be treated as if the return has not filed.
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Your Answer Last
255

Question Capital Gains are chargeable to Income Tax if there is any profit or gain arising
from the transfer of a :-
Correct Answer Capital Asset
Your Answer Capital Asset

True/False
Question Entertainment Allowance is available for deduction only for the Government
Employees.
Correct Answer TRUE
Your Answer FALSE

Question Deduction from Gross Total Income in respect of payment of Medical Insurance
Premium is available under Section :-
Match The Following

When the employee sells the shares allotted to him under the Employees Stock Option Plan Liability
to pay the tax under the head Income from Capital Gains arises Liability to pay the tax under the
head Income from Capital Gains arises
For the purpose of Standard deduction the term Salary includes All components of Salary to the
extent they are not exempt from tax. All components of Salary to the extent they are not exempt
from tax.
Tax on Employment is an indirect tax levied by the state Government. is an indirect tax levied by
the state Government.
In respect of the amount of salary received in advance or in arrears Relief under section 89 is available
to an employee Relief under section 87 is available to an employee
True/False
Your Answer FALSE

Your Answer Whole of its income will be taxable
Select The Blank

256
Question Belated return can be filed at any time before the expiry of one year from the end
of the relevant ________ or before the completion of assessment, whichever is earlier.

Select The Blank

Question Dividends from the ________ is an exempt income and hence will not be
included in the Taxable income.
Your Answer Foreign Companies

Your Answer The payment is made during year
Match The Following

depreciation is 10%
True/False
Your Answer TRUE

Question Following news agencies are specified by the Central Government as specified
news agencies :-
Your Answer PTI , UNI

Question As per the provision of section 143(2) and 143(3) scrutiny assessment made by
assessing officer in order to ensure that :-
257
Your Answer Assessee has not understated the income , Assessee has not overstated the

Question Following situations are treated as change in constitution of partnership firm:-
Correct Answer Change of profit sharing ratio , Addition of new partner , Resignation of
existing partner
Your Answer Change of profit sharing ratio , Addition of new partner , Introduction of additional
capital
True/False
Question A company is resident of India if in any previous year it is an Indian Company
even though control & management are situated outside India.
Your Answer TRUE

Question The provisions under section 44AB of the Act, is applicable to the person
carrying on the profession and whose gross receipts in profession :-
Your Answer Exceeds Rs.40 lakhs in any assessment year
True/False
Question Income earned & received outside India & remitted to India is taxable for resident
& ordinary resident
Correct Answer TRUE
Your Answer TRUE

Question Mr. A had borrowed an amount of Rs. 25,000 from his friend. Out of this amount,
he invested an amount of Rs.10,000 in the PPF account opened in the name of his wife. Which of the
following is true?
Select The Blank

Your Answer Persons
258

Question The Net Annual Value of the house of Mr. X is Rs 75,000 which he has let out for
the rent of Rs 7,000, the statutory deduction under the act will be :-

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term
Correct Answer Any partner of the firm or his relative , Any person having the
substantial interest in the business or profession of the firm or any director or partner of such company or
firm or any relative of such person. , Any person who carries on business or profession and in his business
or profession the assessee or any partner of such firm or relative of such partner has substantial interest.
Your Answer Any partner of the firm or his relative , Any person having the substantial interest
Select The Blank

Question Where an assessee files or submits the returns as per provisions of section 139
or in response to the notice under section 142, the assessment officer undertakes ________ as per section
143(2) and section 143(3).

Question Under the clause No-32 of the Act, in the Tax Audit Report, the Auditor is
True/False
Question The due dates for the payment of advance tax are same for corporate assessees
and non-corporate assessees.
Your Answer FALSE

Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or place of
pilgrimage , Company engaged in scientific and industrial research
259

Correct Answer Employer's Contribution to PF is not liable for any tax payment , Interest
credited to the employee's account is not liable for any tax payment. , The lump sum received at the time of
Your Answer Employer's Contribution to PF is not liable for any tax payment , Interest credited
True/False
Your Answer FALSE

Question In respect of leave travel concession If Mr. A has availed the exemption only
once or has not availed any exemption at all, in the block of four years i.e. 1998-2001 then :-
2002-2005 provided that he avails the exemption of LTC in the first calendar year of the next block i.e. 2002.
Your Answer He can carry over the exemption to the next block of four years i.e. 2002-2005
True/False
Question If assessee owns more than one house properties, for his self occupation, annual
value of any one of the house property of his own choice is treated as nil & another house as rented out.
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Question Deduction u/s ________B is available for 10 consequent assessment years from
the year of commencement of production.
Correct Answer 10
Your Answer 10

Question Section 35CCA of the Act applies to any expenditure incurred by the assessee
by way of payment of any sum to :-
Correct Answer The National Fund for rural development set up by the central
government , Any association or institution used for carrying out any programs of rural development , The
National Urban Poverty eradication fund set up by the central government
Your Answer The National Fund for rural development set up by the central government , Any
260


Question Rebate is allowed on any subscription made to the notified deposit scheme,
interest on which is not eligible for deduction under Section 80L of the Act :-
Correct Answer Of a housing finance company , Of any authority satisfying the needs of
housing accommodations or planning & development of cities, towns etc.

Question The amount accumulated to the credit of the employee's provident fund account
is paid at the time of :-

Question The total amount of rebates under Section 88, Section 88B, Section 88C and

Question The amount of accumulated interest on NSCs purchased in the earlier years is
assumed to be reinvested :-
VV - 3rd Taxation

Question What is the treatment of the perquisite in the form of Gas, electricity and water
supplied to the employee?
Correct Answer If the facility of gas, electricity and water is supplied by the employer to
the employee purchasing the same from an outside agency, the valuation of perquisite will be the charges
paid by the employer to the outside agency supplying gas, electricity and water. , If the facility in the form of
gas, electricity and water is supplied by the employer out of his own resources, the valuation of perquisite
will be the manufacturing cost per unit incurred by the employer.
Your Answer If the facility of gas, electricity and water is supplied by the employer to the
employee purchasing the same from an outside agency, the valuation of perquisite will be the charges paid
by the employer to the outside agency supplying gas, electricity and water. , If the facility in the form of gas,
261


Question Any premium paid by the assessee by Cheque as an employer to effect or keep
in force an insurance on the health of his employees is :-
profession
Your Answer Allowed as expenses while calculating profits from business and profession
Select The Blank

Question If the person responsible for deducting the tax at source and paying the same to
the credit of Central Government has not been allotted the Tax Deduction Account Number (TAN), he shall
within ________ from the end of the month in which the tax was deducted, apply for the allotment of TAN
Number.

March of Previous year is :-
Select The Blank

Question The rebate u/s 88B is available to an individual who has attained the age of
Correct Answer 65
Your Answer 65
Select The Blank

Select The Blank

Question Loss under the head Income from Capital Gains, to the extent it is long term
capital loss can be carried forward and set off in the subsequent Assessment Years against the ________
subject to the limit of 8 Assessment years.

262
June of Previous year is :-
Correct Answer Nil
Select The Blank

Question Any person, who is responsible for paying any amount to a resident contractor
for carrying out any work under a contract, shall deduct the tax @________.
Correct Answer 0.02
Your Answer 0.3

Your Answer Income from business & profession , Capital gains

Question Following is the list of some of the major persons responsible for deducting the
tax at source :-

Your Answer Total income
True/False
Question Section 80QQB is applicable to the individual resident who is an author of text
books.
Your Answer FALSE

Question Mr. A whose Gross Total Income, before allowing deductions under Chapter VI-A
is Rs. 1,30,000, wants to make the investments in the following alternative forms - Rs. 50,000 in PPF and
Rs. 50,000 in Infrastructure Bonds. The amount of rebate available to him u/s 88 is :-

Correct Answer 0.1
Your Answer 0.1
Select The Blank

Question The rebate u/s ________ is available to a woman assessee below the age of 65
years at any time during the previous years.
263
Correct Answer 88C

Your Answer 88C
True/False
Question Software technology park means set up according to Software Technology Park
Scheme framed by Ministry of Commerce & Industries.
Correct Answer TRUE
Your Answer TRUE

Select The Blank

Question The amount of rebate/s 88C is 100% of the income tax liability before claiming
the rebate under section 88 and relief under section 89( 1) pr Rs.________ whichever is less.
Correct Answer 5000
Your Answer 20000
Select The Blank


Question During the current Assessment Year, Mr. A bought 1000 Equity Shares of A Ltd.,
a company manufacturing paper, which had issued 10,00,000 Equity Shares of Rs. 10 each. What is the
True/False
Correct Answer TRUE
Your Answer TRUE
True/False
Question A person who is a Senior Citizen who has attained the age of 65 years is not
Your Answer TRUE

264
Question Any amount deposited by an Individual or a HUF in 10 year or 15 year account

under the Post Office Saving Bank (CTD) Rules, 1959. The account can be in the name of :-

Correct Answer Attends general administration , Frames business policies , Takes
business decisions
Your Answer Frames business policies , Takes business decisions , Attends general
administration
True/False
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Question The amount of rebate u/s 88B is 100% of the income tax liability before claiming
the rebate under section 88 and relief under section 89(1) or Rs.________ whichever is less.
Your Answer 20000

Correct Answer All returns to or correspondence with the Income Tax Authorities , All
the challans for the payment of any amount under the Act , All the documents pertaining to purchase, sale
and bank transactions
Your Answer All returns to or correspondence with the Income Tax Authorities , All the
challans for the payment of any amount under the Act

True/False
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method as well as
straight line method for the computation of depreciation u/s 32 this act.
Your Answer TRUE

Your Answer To reduce the Gross Total Income

265
True/False
Question Interest on capital can be paid at the rates decided by the partners.
Correct Answer TRUE
Your Answer FALSE
Select The Blank

Question If the CC of the engine is less than 1.6 liters and the motor car is owned or hired
by the employer and is used partly of official and partly for personal purposes and if running and
maintenance expenses are borne by the employee then the value of perquisite will be Rs.________ per
month plus Rs.600 if car is chauffer driven car.
Correct Answer 400
Your Answer 400

Question Mr X has received Rs 200000 as income from salary, Rs 50000 income from
house property and he also received Rs 100000 income from specified units of the mutual fund. What will
be his total income
Match The Following

u/s 37 u/s 37
Select The Blank

Question It is mandatory for ________ to file a return even if there is loss or the income is
nil.
Your Answer Non-corporate assessee

Match The Following

Excluded from ambit of term Capital Asset Stock in Trade Stock in Trade
266
Short Term Capital Asset Equity Shares held for a period of Less than 36 months Equity Shares
held for a period of Less than 36 months
Long Term Capital Asset Land held for a period of 36 months or more Land held for a period of 36 months
or more
True/False
Question Loss from house property can be adjusted against the income from any other
house property.
Correct Answer TRUE
Your Answer TRUE

Question Deduction in respect of Contribution to certain pension funds u/s 80CCC is
available to :-
Select The Blank

Question After deducting interest on capital & remuneration to partners, firm is required to
pay tax @ ________
Select The Blank

Question If the employer provides the accommodation in a hotel (except where the
employee is provided such accommodation for a period of less than 15 days on his transfer from one place
to another), the perquisite will be considered to be equal to ________% of the salary or actual charges paid
to the hotel, whichever is less.
Correct Answer 24
Your Answer 20

Your Answer Expenses for launching a new project
True/False
Question Annual premium paid by the employer for the accident insurance policy taken by
the employer in the name of the employee is chargeable to tax.
Your Answer FALSE

is Rs. 1,45,000, wants to make the investments in the following alternative forms - Rs. 80,000 in PPF and
Rs. 20,000 in Infrastructure Bonds. The amount of rebate available to him u/s 88 is :-
267
Match The Following

Intangible Capital Asset Tenancy Rights Equity Shares held for a period of Less than 36 months
Excluded from ambit of term Capital Asset Stock in Trade Land
Long Term Capital Asset Land held for a period of 36 months or more Land held for a period of 36 months
or more
Select The Blank

Correct Answer 0.1
Your Answer 0.1
Select The Blank

Question Free meals provided by the employer during the office hours provided that the value per meal
does not exceed Rs. ________.
Correct Answer 50
Your Answer 25
True/False
Question Professional Tax paid by a person carrying on the business is allowed as business expenditure.
Correct Answer True
Your Answer True
Match The Following

Retrenchment Compensation Exemption can be claimed u/s 10(10B) of the Income Tax Act Terminal
Compensation
Salary or wages for the purpose of calculating Death-Cum -Retirement Gratuity. Basic Salary plus Dearness
allowance Basic Salary plus Dearness allowance
Any amount of compensation received or receivable by the employee from the employer at the time of
termination of his employment or at the time of modification of terms and conditions in connection with the
employment. Terminal Compensation Treated as income from other sources.
268
Any Death-Cum-Retirement Gratuity received Treated as income from salary Treated as income from salary
True/False
Question Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34) of the IT
Act.
Your Answer False
Select The Blank

Question The valuation of perquisites in the case of interest free loans or the loans at the concessional
rate of interest will be the sum equal to the interest calculated at the rate charges by State Bank of India, on
the first day of the relevant previous year in respect of the loans for the same purpose. Such interest is
calculated on the ________ monthly balance.
Correct Answer Maximum outstanding
Your Answer Minimum outstanding

Question For the purpose of calculating the value of perquisite of residential accommodation the term
salary does not include :-
Correct Answer Dearness Allowance , Employer's contribution to Provident Fund , Allowances which are
exempt from tax
Your Answer Dearness Allowance , Employer's contribution to Provident Fund

Correct Answer Salary earned in India even if paid outside India , Salary paid by Government to Indian
national for services rendered outside India , Income from any capital asset situated outside India
True/False
Question Any sum payable by the assessee as interest on any loan borrowed by him from any state
financial corporation as per the terms on the agreement is not allowed as deduction from profit as per P & L
account, if they are actually paid before the due date of furnishing return of income.
Your Answer True

Question What is the treatment of the perquisite in the form of Gas, electricity and water supplied to the
employee?
Correct Answer If the facility of gas, electricity and water is supplied by the employer to the employee
purchasing the same from an outside agency, the valuation of perquisite will be the charges paid by the
employer to the outside agency supplying gas, electricity and water. , If the facility in the form of gas,
Select The Blank

Taxable income.
269

Question The various payments which are referred as deductions under section 43B, Clause No-21 are :-
Correct Answer Any employees contribution payable by the assessee towards any Provident Fund or
agreement

Question If the capital gains arise on account of compulsory acquisition of the capital asset under any law
and any compensation is paid for such acquisition :-
Correct Answer The capital gains liability will be computed in the previous year in which the
compensation or the part thereof is first received


Question The head of income in the form of Income from Salaries is applicable in respect of the :-
Correct Answer Remuneration received by an employee from the employer
Your Answer Remuneration received by an employee from the employer
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires company engaged in production, mining,
and manufacturing activities should maintain proper books of accounts showing the particulars of utilization
of material, labour or any other item.
Your Answer Section 209 of the Income Tax Act, 1961

Correct Answer It is an Indian Co. , It can be any other Co. , Has made prescribed arrangements for
declaration and payment of dividend


Correct Answer Any partner of the firm or his relative , Any person having the substantial interest in the
270
True/False
Question Refund of Income tax is taxable as Income from other sources.
Select The Blank

Question Capital Gains are chargeable to Income Tax if there is any profit or gain arising from the transfer
of a :-
VV - 1ST TAXATION

Correct Answer Generation or distribution of power , Developing, maintaining
or operating any infrastructure facility where the term infrastructure facility means a road (including a toll
road, a bridge or a rail system) or a highway project or a water supply project. , Developing, maintaining or
operating an industrial park or special economic zones notified by the Central Government
Your Answer Developing, maintaining or operating any infrastructure facility where
the term infrastructure facility means a road (including a toll road, a bridge or a rail system) or a highway
project or a water supply project. , Developing, maintaining or operating an industrial park or special
economic zones notified by the Central Government , Generation or distribution of power
Select The Blank

Question If the property becomes the property of the assessee before ________,
the Fair Market Value of the property of the capital asset on that date will be considered to be the cost of
acquisition
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the
form of motor car, the wear and tear will be calculated @ ________ %.
Correct Answer 20
Your Answer 20

271

Your Answer Statutory Provident Fund , Recognized Provident Fund , Unrecognized
Provident Fund
Select The Blank

Your Answer 0.1

Question Income from other sources covers agricultural income from land
situated :-
Your Answer In India


units of any approved mutual fund or of Unit Trust of India in accordance with a notified scheme (Equity
Linked Savings Scheme) :-
True/False
Correct Answer TRUE
Your Answer TRUE
Select The Blank

from other sources.

Question The person responsible for paying to any person any income by way of
winnings from lotteries or crossword puzzles or card games or games of any kind shall be required to
deduct the tax , at the time of making the payment. However, no tax is required to be deducted if the amount
of payment does not exceed :-

Question The exemption for Leave travel Concession u/s 10(5)is available in
respect of how many children Born after 1st October 1998?
272

Your Answer Only 1
Match The Following

Any subscription made to National Saving Scheme By an individual or a HUF is eligible for
rebate u/s 88 By an individual or a HUF is eligible for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs. 2,50,000 during the
Assessment Year 2005-2006. He invested Rs. 50,000 in the tax saving bonds of ICICI on 10th June 2004.
His tax liability for the A Y 2005-2006. RS.12,500 Is eligible for rebate u/s 88D
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross Total Income of Rs.
1,45,000 including the dividend from Indian companies amounting to Rs. 10,000. She invests Rs. 50,000 in
PPF during the said Assessment Year. her tax liabilit is Rs. 1,000 RS.12,500
Any contribution made to a Public Provident Fund Is eligible for rebate u/s 88 Is eligible for
rebate u/s 88


Question Income from winning from lotteries / crossword puzzles/ horse races is
Correct Answer 0.3
Your Answer 0.35



Agent of NRI

Correct Answer Salary earned in India even if paid outside India , Salary paid
by Government to Indian national for services rendered outside India , Tax deducted in India
Your Answer Salary earned in India even if paid outside India , Salary paid by
Government to Indian national for services rendered outside India , Tax deducted in India
Select The Blank

273
Question Free meals provided by the employer during the office hours provided
that the value per meal does not exceed Rs. ________.
Correct Answer 50
Your Answer 50
Select The Blank

Correct Answer None
Your Answer None

Question Deduction in respect of Contribution to certain pension funds is related
to :-
True/False
Question If a person is required to quote the PAN and he quotes or intimates a
false number then he may be liable to pay a penalty of Rs. 25000.
Your Answer TRUE

Select The Blank

Question It should be noted that the tax liability of an individual having the total
income of less than Rs ________ is Nil u/s 88D.

Question What is the due date for filing Annual return for TDS from payment of
interest?
True/False
Question If the capital asset becomes the property of the assessee by virtue of
gift or will, the period for which the capital asset is held by the previous owner should be excluded while
deciding the holding period.
Your Answer TRUE

Question Deduction from Capital Gains from the transfer of residential house
property under Section 54 is available to :-
274

Question Any amount paid by an individual as tuition fees to any educational
institution in India for the purpose of full time education of the individual's children. The maximum allowable
limit is :-
Correct Answer Rs. 12,000 per child per annum , Subject to the maximum of
two children.
Your Answer Rs. 12,000 per child per annum , Subject to the maximum of two
children.

Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of various
payments are allowed as deductions only if they are actually paid but, where if the assessee follows the
________, the payments can be claimed on due basis.

Question Value at which house property is offered for taxation under the head
income from house property is :-
Select The Blank

Select The Blank

Question The basic requirement of section 37 is that the expenditure should have
been incurred by the assessee ________ for the purpose of business.
Your Answer Other than
True/False
Question Income of a mutual fund is taxable even if it is authorized by RBI.
Your Answer FALSE

Correct Answer Policy taken by a person (usually employer) on the life of
another person (usually a senior employee) where the employee pays a key role in the organization of the
employer
Your Answer Policy taken by a person (usually employer) on the life of another
person (usually a senior employee) where the employee pays a key role in the organization of the employer
275
Match The Following

Superannuation Fund It is an employee welfare scheme No exemption Available .
Statutory Provident Fund This is set up as per the provisions of Provident Fund Act, 1925.
It is an employee welfare scheme
Recognized Provident Fund the provisions of Employees Provident Fund and
Miscellaneous Provisions Act, 1952 apply to this fund.This is set up as per the provisions of Provident Fund
Act, 1925.
True/False
incurred by the employee on credit card and which are paid by the employer shall be added as the
perquisites unless the said expenses are incurred wholly and exclusively for official purposes.
Correct Answer TRUE
Your Answer TRUE

Question In case the assessee is not a company, a person(other than a
company) who is falling under One by Six economic criteria, the last date for filing the return is prescribed as
:-

Your Answer Municipal value

Question In case of Payment of Interest on Securities no tax is required to be
deducted under the following circumstances :-
debentures are listed on a stock exchange and if the amount of interest does not exceed Rs. 2,500 during
the financial year. , If the interest paid is on State or Central Government Securities , If the debentures are
issued by an institution, authority, Public Sector Company or co-operative society as the Central
Your Answer If the interest paid is on State or Central Government Securities , If the
debentures are issued by an institution, authority, Public Sector Company or co-operative society as the
Central Government may notify. , If the debentures are issued by a widely held company and the
debentures are listed on a stock exchange and if the amount of interest does not exceed Rs.5,000 during
the financial year.
True/False
Correct Answer TRUE
Your Answer TRUE
276
Select The Blank

Question Expenditure incurred in connection with the local festivals like Diwali
etc. are ________ as business expenditure.
Your Answer Allowed at assessing officers choice


True/False
Question If the debentures are converted into shares, it is considered to be
transfer of the capital asset.
Your Answer FALSE
True/False
Question Any expenditure incurred for earning the income which is included
under the head income from other sources will be allowed as deduction from such income provided that
certain conditions are satisfied
Correct Answer TRUE
Your Answer TRUE
VV - 2ND TAXATION

Question In case of the individual or HUF whose Gross Total Income, before
deductions under Chapter VI-A, is more than Rs. 5,00,000, then :-

Question Any amount received by the assessee under a Keyman Insurance
Policy including the bonus on such policy is :-
Your Answer Taxable under the head income from other sources
True/False
Question The value of benefit resulting from the payment made by the employer
in a club for any expenditure incurred by the employee shall be taken as perquisites unless the said
expenses are incurred wholly and exclusively for official purposes.
Correct Answer TRUE
277
Your Answer TRUE
Select The Blank

teachers etc under Section 80R is limited to ________% of such remuneration brought in India.
Correct Answer 15
Your Answer 15

Question The least of the following is the exemption available to an employee if
he is in receipt of house rent allowance :-
Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is situated at any
other place. , Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the
Salary.
Your Answer 50% of the Salary where such accommodation is situated in Mumbai,
Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is situated at any other place. ,
Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the Salary.
Select The Blank

previous year for the purpose of employment has to be in India for ________ days or more during previous
year.
Correct Answer 182
Your Answer 182

True/False
Question If the defective return filed under section 139(9) is not rectified within 15
days, the return filed by the assesee shall be considered invalid and it will be treated as if the return has not
filed.
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Your Answer Last

Question Capital Gains are chargeable to Income Tax if there is any profit or gain
arising from the transfer of a :-
Your Answer Capital Asset

278

True/False
Question Entertainment Allowance is available for deduction only for the
Government Employees.
Correct Answer TRUE
Your Answer FALSE

Question Deduction from Gross Total Income in respect of payment of Medical
Insurance Premium is available under Section :-
Match The Following

When the employee sells the shares allotted to him under the Employees Stock Option Plan
Liability to pay the tax under the head Income from Capital Gains arises Liability to pay the tax
under the head Income from Capital Gains arises
For the purpose of Standard deduction the term Salary includes All components of Salary
to the extent they are not exempt from tax. All components of Salary to the extent they are not exempt
from tax.
Tax on Employment is an indirect tax levied by the state Government. is an indirect tax
levied by the state Government.
In respect of the amount of salary received in advance or in arrears Relief under section 89 is
available to an employee Relief under section 87 is available to an employee
True/False
Your Answer FALSE

Question If notified news agency distributes its income amongst its members then
:-
Your Answer Whole of its income will be taxable
Select The Blank

Question Belated return can be filed at any time before the expiry of one year
from the end of the relevant ________ or before the completion of assessment, whichever is earlier.

279
Select The Blank

Question Dividends from the ________ is an exempt income and hence will not
be included in the Taxable income.
Your Answer Foreign Companies

Your Answer The payment is made during year
Match The Following

All intangible assets like Patents, Trademarks, Copy Rights, Licenses etc. Rate of
depreciation is 25% Rate of depreciation is 25%
depreciation is 10%
True/False
Your Answer TRUE

Question Following news agencies are specified by the Central Government as
Your Answer PTI , UNI

Question As per the provision of section 143(2) and 143(3) scrutiny assessment
made by assessing officer in order to ensure that :-
Your Answer Assessee has not understated the income , Assessee has not

Question Following situations are treated as change in constitution of partnership
firm:-
Correct Answer Change of profit sharing ratio , Addition of new partner ,
Resignation of existing partner
Your Answer Change of profit sharing ratio , Addition of new partner , Introduction of
additional capital
True/False
Question A company is resident of India if in any previous year it is an Indian
Company even though control & management are situated outside India.
280
Your Answer TRUE

Question The provisions under section 44AB of the Act, is applicable to the
person carrying on the profession and whose gross receipts in profession :-
Your Answer Exceeds Rs.40 lakhs in any assessment year
True/False
Question Income earned & received outside India & remitted to India is taxable
for resident & ordinary resident
Correct Answer TRUE
Your Answer TRUE

Question Mr. A had borrowed an amount of Rs. 25,000 from his friend. Out of this
amount, he invested an amount of Rs.10,000 in the PPF account opened in the name of his wife. Which of
the following is true?
Select The Blank

Question AOP id formed when two or more ________ come together to earn
income.
Your Answer Persons

Question The Net Annual Value of the house of Mr. X is Rs 75,000 which he has
let out for the rent of Rs 7,000, the statutory deduction under the act will be :-

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm,
the term "Specified Persons" may include :-
Correct Answer Any partner of the firm or his relative , Any person having the
Your Answer Any partner of the firm or his relative , Any person having the
Select The Blank

Question Where an assessee files or submits the returns as per provisions of
section 139 or in response to the notice under section 142, the assessment officer undertakes ________ as
per section 143(2) and section 143(3).
281

Question Under the clause No-32 of the Act, in the Tax Audit Report, the Auditor
is required to give the accounting calculation in ratios of :-
Correct Answer Gross profit/turnover , Net profit/turnover , Stock in
trade/turnover
True/False
Question The due dates for the payment of advance tax are same for corporate
assessees and non-corporate assessees.
Your Answer FALSE

Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or
place of pilgrimage , Company engaged in scientific and industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural area or place of
pilgrimage , Company engaged in scientific and industrial research

Correct Answer Employer's Contribution to PF is not liable for any tax payment
, Interest credited to the employee's account is not liable for any tax payment. , The lump sum received at
the time of retirement or resignation or death is also exempt under section 10(11) and 10(12).
Your Answer Employer's Contribution to PF is not liable for any tax payment , Interest
credited to the employee's account is not liable for any tax payment. , The lump sum received at the time of
True/False
Your Answer FALSE

only once or has not availed any exemption at all, in the block of four years i.e. 1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of four years
i.e. 2002-2005 provided that he avails the exemption of LTC in the first calendar year of the next block i.e.
2002.
2002-2005 provided that he avails the exemption of LTC in the first calendar year of the next block i.e. 2002.
True/False
Question If assessee owns more than one house properties, for his self
occupation, annual value of any one of the house property of his own choice is treated as nil & another
house as rented out.
Correct Answer TRUE
Your Answer TRUE
282
Select The Blank

Question Deduction u/s ________B is available for 10 consequent assessment
years from the year of commencement of production.
Correct Answer 10
Your Answer 10

Question Section 35CCA of the Act applies to any expenditure incurred by the
assessee by way of payment of any sum to :-
Your Answer The National Fund for rural development set up by the central

Question The sum total of all the heads of income clubbed together gives the
amount of :-

Question Rebate is allowed on any subscription made to the notified deposit
scheme, interest on which is not eligible for deduction under Section 80L of the Act :-
Correct Answer Of a housing finance company , Of any authority satisfying the
needs of housing accommodations or planning & development of cities, towns etc.
Your Answer Of a housing finance company , Of any authority satisfying the needs of


Question The total amount of rebates under Section 88, Section 88B, Section
88C and Section 88D of the Act. shall :-

283
VV - 3rd Taxation

Question What is the treatment of the perquisite in the form of Gas, electricity and
water supplied to the employee?
Correct Answer If the facility of gas, electricity and water is supplied by the
employer to the employee purchasing the same from an outside agency, the valuation of perquisite will be
the charges paid by the employer to the outside agency supplying gas, electricity and water. , If the facility in
the form of gas, electricity and water is supplied by the employer out of his own resources, the valuation of
perquisite will be the manufacturing cost per unit incurred by the employer.
Your Answer If the facility of gas, electricity and water is supplied by the employer to
the employee purchasing the same from an outside agency, the valuation of perquisite will be the charges
paid by the employer to the outside agency supplying gas, electricity and water. , If the facility in the form of
gas, electricity and water is supplied by the employer out of his own resources, the valuation of perquisite
will be the manufacturing cost per unit incurred by the employer.

Question Rebate is allowed on any subscription made to National Saving Scheme
by :-

Question Any premium paid by the assessee by Cheque as an employer to effect
or keep in force an insurance on the health of his employees is :-
Correct Answer Allowed as expenses while calculating profits from business
and profession
Your Answer Allowed as expenses while calculating profits from business and
profession
Select The Blank

Question If the person responsible for deducting the tax at source and paying the
same to the credit of Central Government has not been allotted the Tax Deduction Account Number (TAN),
he shall within ________ from the end of the month in which the tax was deducted, apply for the allotment of
TAN Number.

Select The Blank

Question The rebate u/s 88B is available to an individual who has attained the
age of ________ or more at any time during the previous year.
Correct Answer 65
Your Answer 65
284
Select The Blank

Select The Blank

Question Loss under the head Income from Capital Gains, to the extent it is long
term capital loss can be carried forward and set off in the subsequent Assessment Years against the
________ subject to the limit of 8 Assessment years.

15th June of Previous year is :-
Correct Answer Nil
Select The Blank

Question Any person, who is responsible for paying any amount to a resident
contractor for carrying out any work under a contract, shall deduct the tax @________.
Correct Answer 0.02
Your Answer 0.3

Your Answer Income from business & profession , Capital gains

Question Following is the list of some of the major persons responsible for
deducting the tax at source :-

Your Answer Total income
True/False
Question Section 80QQB is applicable to the individual resident who is an author
of text books.
Your Answer FALSE

Chapter VI-A is Rs. 1,30,000, wants to make the investments in the following alternative forms - Rs. 50,000
in PPF and Rs. 50,000 in Infrastructure Bonds. The amount of rebate available to him u/s 88 is :-
285


Question If taxable income is less than 7.5% of book profit, income tax is payable
@ of :-
Correct Answer 0.1
Your Answer 0.1
Select The Blank

Question The rebate u/s ________ is available to a woman assessee below the
age of 65 years at any time during the previous years.
Correct Answer 88C
Your Answer 88C
True/False
Question Software technology park means set up according to Software
Technology Park Scheme framed by Ministry of Commerce & Industries.
Correct Answer TRUE
Your Answer TRUE

Correct Answer Standard deduction , Interest on borrowed capital , Municipal
taxes
Select The Blank

Question The amount of rebate/s 88C is 100% of the income tax liability before
claiming the rebate under section 88 and relief under section 89( 1) pr Rs.________ whichever is less.
Correct Answer 5000
Your Answer 20000
Select The Blank


Question During the current Assessment Year, Mr. A bought 1000 Equity Shares
of A Ltd., a company manufacturing paper, which had issued 10,00,000 Equity Shares of Rs. 10 each. What
is the rebate available for such investment?
True/False
Correct Answer TRUE
Your Answer TRUE
True/False
286
Question A person who is a Senior Citizen who has attained the age of 65 years
is not entitled to the rebate u/s 88 of the Act.
Your Answer TRUE

Question Any amount deposited by an Individual or a HUF in 10 year or 15 year
account under the Post Office Saving Bank (CTD) Rules, 1959. The account can be in the name of :-

Correct Answer Attends general administration , Frames business policies ,
Takes business decisions
Your Answer Frames business policies , Takes business decisions , Attends general
administration
True/False
Question A woman assessee below the age of 65 years is also entitled to rebate
u/s 88.
Correct Answer TRUE
Your Answer TRUE
Select The Blank

Question The amount of rebate u/s 88B is 100% of the income tax liability before
claiming the rebate under section 88 and relief under section 89(1) or Rs.________ whichever is less.
Your Answer 20000

Correct Answer All returns to or correspondence with the Income Tax
Authorities , All the challans for the payment of any amount under the Act , All the documents pertaining to
purchase, sale and bank transactions
Your Answer All returns to or correspondence with the Income Tax Authorities , All
the challans for the payment of any amount under the Act

True/False
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method
as well as straight line method for the computation of depreciation u/s 32 this act.
Your Answer TRUE

287

Your Answer To reduce the Gross Total Income

True/False
Question Interest on capital can be paid at the rates decided by the partners.
Correct Answer TRUE
Your Answer FALSE
Select The Blank

Question If the CC of the engine is less than 1.6 liters and the motor car is owned
or hired by the employer and is used partly of official and partly for personal purposes and if running and
maintenance expenses are borne by the employee then the value of perquisite will be Rs.________ per
month plus Rs.600 if car is chauffer driven car.
Correct Answer 400
Your Answer 400

Question Mr X has received Rs 200000 as income from salary, Rs 50000 income
from house property and he also received Rs 100000 income from specified units of the mutual fund. What
will be his total income
Match The Following

Deductions of Rent, Rates, Repairs, Taxes and Insurance on Buildings are available u/s 30
u/s 30
General deductions are allowed as deductions while calculating profits from business and
profession u/s 37 u/s 37
Deductions of Repairs & maintenance of machinery, plant & furniture are available u/s 31
u/s 31
Select The Blank

Question It is mandatory for ________ to file a return even if there is loss or the
income is nil.
Your Answer Non-corporate assessee

Match The Following

288

Excluded from ambit of term Capital Asset Stock in Trade Stock in Trade
Short Term Capital Asset Equity Shares held for a period of Less than 36 months Equity
Shares held for a period of Less than 36 months
Long Term Capital Asset Land held for a period of 36 months or more Land held for a period of
36 months or more
True/False
Question Loss from house property can be adjusted against the income from any
other house property.
Correct Answer TRUE
Your Answer TRUE

Question Deduction in respect of Contribution to certain pension funds u/s
80CCC is available to :-
Select The Blank

Question After deducting interest on capital & remuneration to partners, firm is
required to pay tax @ ________
Select The Blank

Question If the employer provides the accommodation in a hotel (except where
the employee is provided such accommodation for a period of less than 15 days on his transfer from one
place to another), the perquisite will be considered to be equal to ________% of the salary or actual
charges paid to the hotel, whichever is less.
Correct Answer 24
Your Answer 20

expenditure?
Your Answer Expenses for launching a new project
True/False
Question Annual premium paid by the employer for the accident insurance policy
taken by the employer in the name of the employee is chargeable to tax.
Your Answer FALSE

Chapter VI-A is Rs. 1,45,000, wants to make the investments in the following alternative forms - Rs. 80,000
45. Any loans or deposits borrowed or repaid under section 269SS of the Act provides
that the said provisions will not apply to the loans or deposits accepted by :-
a)
Government
b) Government company
c)
Insurance company
d)
Marks : 2
49. Any amount paid by an individual as tuition fees to any educational institution in
India for the purpose of full time education of the individual's children. The
maximum allowable limit is :-
a)
b) Subject to the maximum of two children.

c)
d)
Marks : 2
a)
Gross total income
b) Gross taxable income
Net income
c)
Tax amount
d)

Select The Blank

head preliminary expenses incurred under section 3________,
for an Indian company the aggregate of all the expenditure can
be 5% of the cost of project or 5% of capital employed whichever
is higher.

Question Condition for deduction from Capital Gains arising from transfer
of House property under Section 54 is :-
Correct Answer Assessee must have purchased another residential property one
year before or within two years after the date on which transfer
took place , Assessee must have constructed another residential
property within, three years after the date on which the transfer
took place.
Your Answer Assessee must have purchased another residential property one
took place.
True/False
Question Rebates as per the provisions of Section 88B of the Act are not
Your Answer True

Question Profits earned by an Industrial Undertaking engaged in other
than infrastructure development is available under Section 80IB
for :-
place of pilgrimage , Company engaged in scientific and
industrial research
Your Answer Operation of Ship , Hotels situated in hilly area, rural area or
industrial research
Select The Blank

Question If a person, other than an individual or a HUF, is responsible to
pay the rent to any person in excess of ________ during the
financial year.

employees is included in their salaries and the deduction is
allowed to the extent of least of the following amounts :-
Allowance received.
Allowance received.
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires company
engaged in production, mining, and manufacturing activities
should maintain proper books of accounts showing the
particulars of utilization of material, labour or any other item.

Auditor is required to give the accounting calculation in ratios of
:-
trade/turnover
Your Answer Gross profit/turnover , Net profit/turnover , Stock in
trade/turnover


True/False
Your Answer False

True/False
occupation, annual value of any one of the house property of his
own choice is treated as nil & another house as rented out.
Correct Answer True
Your Answer True

Question The specified assets for the purpose of claiming exemption from
Capital Gains u/s 54EC mean the bonds redeemable after 3
years issued by the following institutions
Correct Answer National Bank for Agriculture and Rural Development (NABARD)
, Rural Electrification Corporation Limited , Small Industries
Development Bank of India
Your Answer National Bank for Agriculture and Rural Development (NABARD)
Select The Blank

Correct Answer 0.35
Your Answer 0.3

Question Which of the following expenses should be debited to P & L
Account, but disallowed for Income tax purpose?
True/False
Question Any Employer's Contribution payable by the assessee towards
any provident fund or superannuation fund or gratuity fund or
any other fund for the welfare of the employees, if they are
actually paid, allowed as deduction.
Correct Answer True
Your Answer True

Question Maximum Deduction u/s 80D in respect of medical insurance
premium for a person who is a Senior Citizen is Rupees :-
Your Answer 15000
Select The Blank

Correct Answer 0.01
Your Answer 0.01

Select The Blank

the age of ________ or more at any time during the previous
year.
Correct Answer 65
Your Answer 65
Select The Blank

subsequent Assessment Years subject to the time limit of
________ Assessment years.
Correct Answer 8
Your Answer 8



True/False
Your Answer True
True/False
Question Sales tax and expenses in connection with the proceedings for
the assessment of sales tax are allowed as business
expenditure.
Correct Answer True
Your Answer True
Match The Following

Perquisites Indicate benefits or Indicate benefits or

amenities provided by the amenities provided by the
employer to the employee, employer to the employee,
either free of cost or at the either free of cost or at the
concessional rate concessional rate
House Rent Allowance This indicates the amount This indicates the amount
paid by the employer to paid by the employer to the
the employee to meet the employee to meet the
expenditure for residential expenditure for residential
accommodation occupied accommodation occupied
by the employee by the employee
Retrenchment Compensation received Compensation received by
Compensation by a worker at the time of a worker at the time of
Traveling Allowance Any allowance granted to assistance received or due
meet the cost of travel on to an assessee from his
tour or on transfer of duty. employer, for himself and
his family for proceeding
on leave to any place in
India or to any place in
India after the retirement or
termination of his service

Question Foreign allowance received by an Indian national is exempt if it
is paid by :-

Question Following news agencies are specified by the Central
Government as specified news agencies :-

Question Annual value of any one palace in possession of a former ruler is
:-
True/False
Question Income tax paid is allowed as deduction while calculating profit
from business or profession.
Your Answer True

Question Section 35CCA of the Act applies to any expenditure incurred by
the assessee by way of payment of any sum to :-
government , Any association or institution used for carrying out
any programs of rural development , The National Urban Poverty
eradication fund set up by the central government
Select The Blank

Question No tax is required to be deducted if the amount paid or credited
in pursuance of any contract does not exceed a certain amount.
However, if the aggregate of such amounts paid or credited to a
payee exceeds ________ the tax is required to be deducted
under this Section.

Correct Answer 0.3
Your Answer 0.3

contained in :-
Select The Blank


Question Any premium paid by the assessee by Cheque as an employer
to effect or keep in force an insurance on the health of his
employees is :-
profession
profession
True/False
Correct Answer True
Your Answer False
True/False
Your Answer False

Correct Answer Borrowal is after 1st April 1999 , Construction is completed in 3
years
Your Answer Deduction can be for principal portion also , Borrowal is after 1st
April 1999 , Construction is completed in 3 years

Question The return of income required to be filed in the form by the Non-
Corporate Assessee not claiming the exemption under the
provisions of section 11 of the Act and not having income from
business and profession is :-

Question Salary paid by any partnership firm to its working partners is
taxable as :-
True/False
Question The payments made u/s 43B of the Income Tax Act are allowed
as deductions only if they are actually paid.
Correct Answer True
Your Answer True
Match The Following

Containers made of glass Rate of depreciation is Rate of depreciation is

or plastic used as refills 40% 40%
All intangible assets like Rate of depreciation is Rate of depreciation is
Patents, Trademarks, 25% 25%
Copy Rights, Licenses
etc.
Temporary Structures Rate of depreciation is Rate of depreciation is
100% 100%
Computers Rate of depreciation is Rate of depreciation is
60% 60%
Select The Blank

teachers etc under Section 80R is limited to ________% of such
remuneration brought in India.
Correct Answer 15
Your Answer 15
Select The Blank

Question If the asset sold or transferred by the employer to employee is in
the form of computers an electronic items, the wear and tear will
be calculated @ ________ %.
Correct Answer 50
Your Answer 20
Score Card
Registration
200404214
Number:
Name: Manpreet Malhotra
Subject: Taxation
Assignment Status
19/03/2006
As On:

Result Pass
Click here to view the list of attempted question and answers.

Select The Blank

Your Answer Political party

Your Answer Wealth Tax , Income Tax

Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal attendant , Gas,

Correct Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata, Chennai
and Delhi and 40% of the Salary when the accommodation is situated at any other place.
, Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the
Salary.
and Delhi and 40% of the Salary when the accommodation is situated at any other place.
, Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the
Salary.


Correct Answer Donations eligible for 100% deduction without any qualifying limit. , Donations eligible for
50% deduction without any qualifying limit , Donations eligible for 75% deduction subject
to qualifying limit
Your Answer Donations eligible for 100% deduction without any qualifying limit. , Donations eligible for
50% deduction without any qualifying limit
True/False
Your Answer False
Select The Blank

Your Answer 15000
Select The Blank

Correct Answer 50
Your Answer 40
Select The Blank

received ________.
Your Answer In advance or in arrears
Select The Blank

Question Expenditure incurred in connection with the local festivals like Diwali etc. are ________
as business expenditure.
Your Answer Allowed
Select The Blank

remuneration brought into India in convertible foreign exchange within a period
of________ months from the end of the previous year.
Correct Answer 6
Your Answer 6
True/False
Your Answer True

Correct Answer 0.25
Your Answer 0.25
True/False
Your Answer False



Question According to the provisions of Section 10(13) of the Act, following payments received
from an Approved Superannuation Fund are exempt from tax :-
Correct Answer The amount paid to the employee in lieu of or in commutation of an annuity on his
retirement on or after a specified age or on his becoming incapacitated prior to such
retirement , The amount paid by way of refund of contribution to the legal heirs on the
death of the beneficiary.
Your Answer The amount paid by way of refund of contribution to the legal heirs on the death of the
beneficiary. , Rs. 25,000 , The amount paid to the employee in lieu of or in commutation
of an annuity on his retirement on or after a specified age or on his becoming
incapacitated prior to such retirement
True/False
Correct Answer True
Your Answer True

the company by having 20% or more of the voting power , The employee whose income
under the head salaries (including all the taxable monetary payments of salary but
excluding the value of any non-monetary benefits or perquisites), after allowing
deductions under Section 16, exceeds Rs. 50,000
the company by having 20% or more of the voting power , The employee whose income
under the head salaries (including all the taxable monetary payments of salary but
excluding the value of any non-monetary benefits or perquisites), after allowing
deductions under Section 16, exceeds Rs. 50,000


the time of :-


True/False
the previous years but are paid during the current previous year, they will be allowed as
deduction during the current previous year.
Correct Answer True
Your Answer False
Select The Blank

Select The Blank

Match The Following

In case of Interest free Loans or The same shall be reduced from The same shall be reduced from
Loans at concessional rate of the valuation of perquisites. the valuation of perquisites.
interest if the employee pays any
amount of interest to the employer
Motor Car Perquisites which is taxable only Perquisites which is taxable only in
in the hands of specified the hands of specified employee
employee
Services of sweeper, gardener, Perquisites which is taxable only Perquisites which is taxable only in
watchman or personal in the hands of specified the hands of specified employee
employee
The employee who has Specified Employee Specified Employee
substantial interest in the
company by having 20% or more
of the voting power

profession
Your Answer Allowed as revenue expenditure while calculating the profits from business and
profession
Select The Blank

True/False
asset.
Your Answer False
True/False
Your Answer True
True/False
Your Answer True
Match The Following

Deduction in case of permanent Section 80U Section 80U

physical disability
Deduction in respect of Interest on Section 80L Section 80L

Bank Deposits
Select The Blank

Correct Answer 50
Your Answer 30

to get his accounts audited by a Chartered Accountant whose sales turnover or gross
receipts :-

Correct Answer Any person who carries on a business or profession and in his business the assessee or
any director of such company or relative of such director has substantial interest. , Any
director of the company or his relative , Any person having a substantial interest in the
business or profession of the company or any director or partner of such firm or company
or the relative of such person.
Your Answer Any director of the company or his relative, Any person having a substantial interest in
the business or profession of the company or any director or partner of such firm or
company or the relative of such person.


Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term
Correct Answer Any partner of the firm or his relative, Any person having the substantial interest in the
business or profession of the firm or any director or partner of such company or firm or
any relative of such person. , Any person who carries on business or profession and in
his business or profession the assessee or any partner of such firm or relative of such
partner has substantial interest.
Your Answer Any partner of the firm or his relative, Any person having the substantial interest in the
business or profession of the firm or any director or partner of such company or firm or
any relative of such person.

Your Answer Value at which house property is valued
True/False
Question Cost of improvement does not include any expenditure which is deductible from any
other head of income.
Correct Answer True
Your Answer True

of :-
Your Answer Agricultural Land
Select The Blank

Question Any person, who is responsible for paying any amount to a resident contractor for
carrying out any work under a contract, shall deduct the tax @________.
Correct Answer 0.02
Your Answer 0.02
True/False
Your Answer True

Question The various payments which are referred as deductions under section 43B, Clause No-
21 are :-
Correct Answer Any employees contribution payable by the assessee towards any Provident Fund or
Superannuation Fund or Gratuity Fund for the welfare of the employees , Any sum
payable by the assessee by way of tax duty, cess or fee , Any sum payable by the
assessee as interest on any loan or borrowing made by him from any public financial
institution or state financial corporation as per the terms of the agreement
Superannuation Fund or Gratuity Fund for the welfare of the employees , Any sum
payable by the assessee by way of tax duty, cess or fee

Your Answer Income from business profession
Select The Blank

can be carried forward and set off in the subsequent Assessment Years against the
Your Answer Short Term Capital Gains.
True/False
property.
Correct Answer True
Your Answer True

True/False
Your Answer False

taxable as "Income from Other Sources" , Employer's Contribution to PF and interest
thereon is taxable as "Income from salaries"
Employer's Contribution to PF and interest thereon is taxable as "Income from salaries"

True/False
ordinary resident
Correct Answer True
Your Answer False
True/False
Question Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34)
of the IT Act.
Your Answer True

Correct Answer All returns to or correspondence with the Income Tax Authorities , All the challans for the
payment of any amount under the Act , All the documents pertaining to purchase, sale
payment of any amount under the Act , All the documents pertaining to purchase, sale
Question According to the provisions of Section 10(13) of the Act, following payments received
from an Approved Superannuation Fund are exempt from tax :-
Correct Answer The amount paid to the employee in lieu of or in commutation of an annuity on his
True/False
Correct Answer True
Your Answer True

Your Answer During the previous year in which the Capital Assets is transferred
Select The Blank

Act.

invested an amount of Rs.10,000 in the PPF account opened in the name of his wife.
Which of the following is true?
True/False
deemed to be the income of the person borrowing or repaying the amount for the
previous year in which the amount was borrowed or repaid.
Correct Answer True
Your Answer True
True/False
Your Answer False

Select The Blank


Correct Answer The computation of income under each head, Gross Total Income are properly filed in ,
The return is accompanied by the tax audit report under section 44AB , The return is
accompanied by copies of required financial statements of the assessee
Your Answer The return is accompanied by the tax audit report under section 44AB , The return is
accompanied by copies of required financial statements of the assessee , The
computation of income under each head, Gross Total Income are properly filed in


Select The Blank


Select The Blank

property is :-

Correct Answer He can carry over the exemption to the next block of four years i.e. 2002-2005 provided

transfer of :-
Your Answer Securities



Your Answer 31st October of the Assessment year
Select The Blank

contract does not exceed a certain amount. However, if the aggregate of such amounts
paid or credited to a payee exceeds ________ the tax is required to be deducted under
this Section.

following :-
True/False
superannuation fund or gratuity fund or any other fund for the welfare of the employees, if
they are actually paid, allowed as deduction.
Correct Answer True
Your Answer True
Select The Blank


source :-
Your Answer Any Local Authority , Any Trust , Any Individual


Question Maximum Deduction u/s 80D in respect of medical insurance premium for a person who
is not a Senior Citizen is Rupees :-

Select The Blank

Your Answer Exempt

True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both tangible as
well as intangible assets.
Correct Answer True
Your Answer False

Correct Answer Any relative of such individual, Any person (individual, company, firm etc.) having a
substantial interest in the business or profession of the individual or any director or
partner of such company or firm or any relative of such person. , Any person who carries
on a business or profession and in his business or profession, the assessee himself or
his relative has a substantial interest.
Your Answer Any relative of such individual, Any person (individual, company, firm etc.) having a
substantial interest in the business or profession of the individual or any director or
partner of such company or firm or any relative of such person.

Match The Following

Statutory Provident Fund This is set up as per the This is set up as per the provisions
provisions of Provident Fund Act, of Provident Fund Act, 1925.
1925.
Recognized Provident Fund the provisions of Employees the provisions of Employees
Provident Fund and Miscellaneous Provident Fund and Miscellaneous
Provisions Act, 1952 apply to this Provisions Act, 1952 apply to this
fund. fund.
Unrecognized Provident Fund The provident fund which is not The provident fund which is not
authorities . authorities.
Select The Blank

Question Any person, who is responsible for paying any amount to a resident contractor for
carrying out any work under a contract, shall deduct the tax @________.
Correct Answer 0.02
Your Answer 0.02
Select The Blank

Your Answer Offence
Match The Following

Super Annuation Fund This is an employee welfare This is an employee welfare

scheme which is usually scheme which is usually applicable
applicable in case of very senior in case of very senior employees
employees
Statutory Provident Fund This is set up as per the This is set up as per the provisions
provisions of Provident Fund Act, of Provident Fund Act, 1925. This
1925. This is maintained by is maintained by Government
Government organizations, local organizations, local authorities,
authorities, universities and universities and educational
educational institutions. institutions.
Recognized Provident Fund This is the provident fund to which This is the provident fund to which
the provisions of Employees the provisions of Employees
Provident Fund and Miscellaneous Provident Fund and Miscellaneous
Provisions Act, 1952 apply. Provisions Act, 1952 apply.
Unrecognized Provident Fund The provident fund which is not The provident fund which is not
authorities is called as authorities is called as
unrecognized provident fund. unrecognized provident fund.
Select The Blank

Your Answer Indian

Select The Blank

Correct Answer None
Your Answer None
Select The Blank

True/False
Correct Answer True
Your Answer True
Select The Blank

Correct Answer 0.9
Your Answer 0.5

amounts
Your Answer Cost of acquisition , Cost of improvement

Correct Answer 0.1
Your Answer 0.1

claiming the exemption under the provisions of section 11 of the Act and not having
income from business and profession is :-


Select The Blank

at the time of termination of his employment or at the time of modification of terms and
conditions in connection with the employment is called as ________.

Correct Answer Salary earned in India even if paid outside India , Salary paid by Government to Indian
national for services rendered outside India
True/False
Salary received from all the employers will be aggregated and then the Standard
Deduction will be allowed.
Correct Answer True
Your Answer True


Select The Blank

Select The Blank

Your Answer Wholly and exclusively

Match The Following

Uncommuted Pension Indicates the periodical payment Income from other sources
of pension
Commuted Pension Indicates the lump sum received Indicates the periodical payment of
in lieu of the periodical pension
Treatment of Perquisite Taxed in the hands of employee Taxed in the hands of employee as
as taxable salary taxable salary

Select The Blank

Question If a person, other than an individual or a HUF, is responsible to pay the rent to any
person in excess of ________ during the financial year.
True/False
Correct Answer True
Your Answer True

Select The Blank

employer and is used partly of official and partly for personal purposes and if running and
maintenance expenses are borne by the employee then the value of perquisite will be
Rs.________ per month plus Rs.600 if car is chauffer driven car.
Correct Answer 600
Your Answer 600

Select The Blank

True/False
Correct Answer True
Your Answer True


Section 54 is :-
Correct Answer Assessee must have purchased another residential property one year before or within
two years after the date on which transfer took place; Assessee must have constructed
another residential property within, three years after the date on which the transfer took
place.
Your Answer Assessee must have purchased another residential property one year before or within
two years after the date on which transfer took place; Assessee must have constructed
another residential property within, three years after the date on which the transfer took
place.
Select The Blank

True/False
employee after the date of furnishing return of income, this sum was payable in the
previous year is allowed as deduction.
Your Answer True
Match The Following

Disallowable Expenditure Litigation Expenses in connection Premium on redemption of

with recovery of a debt which is Debentures
not a trading debt
Business Includes trade, commerce, or Includes trade, commerce, or
manufacture or any adventure or manufacture or any adventure or
concern in the nature of trade, concern in the nature of trade,
commerce or manufacture commerce or manufacture
Capital Expenditure Expenditure incurred by a Expenditure incurred by a company

company with the issue of rights with the issue of rights shares
shares

Your Answer The individual himself, A minor of whom he is the guardian. , Spouse of individual

Question Which of the following amounts credited to P & L Account but not taxable from Income
tax Purposes as Profits from Business and Profession?

insurance policy
Your Answer Interest on securities of local authority , Bonus from key man insurance policy , Pension
True/False
Correct Answer True
Your Answer False

Correct Answer Any revenue expenses incurred by the assessee for carrying out the scientific research
provided that such research is related to his business , Any capital expenses incurred by
the assesse himself for carrying out the scientific research provided that such research is
related to his business , The assesse is a company engaged in the business of bio-
technology or any other notified product a weighted deduction of 150% is allowed in
respect of in-house research and development expensed, till 31st March, 2005
provided that such research is related to his business , Any capital expenses incurred by
related to his business

Previous year is :-

True/False
Your Answer True

respect of
Certificates (NSCs) Interest on National Saving Scheme, 1992 (NSS)
Select The Blank

Select The Blank

company or a local authority or an association approved by the national committee for
________ for carrying out any project in upliftment of public.
Your Answer Promotion of education and literacy

Previous year is :-

Your Answer Company secretary , Accounting

submit the copy of such report under section 44AB, he will be liable to pay the penalty
equal to :-
Your Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is more

)
Match The Following

Intangible Capital Asset Tenancy Rights Equity Shares held for a period of Less than 36 months
Excluded from ambit of term Capital Asset Stock in Trade Land
Long Term Capital Asset Land held for a period of 36 months or more Land held for a period of 36 months or more
Select The Blank

Correct Answer 0.1
Your Answer 0.1
Select The Blank

Question Free meals provided by the employer during the office hours provided that the value per meal does not exceed
Rs. ________.
Correct Answer 50
Your Answer 25
True/False
Question Professional Tax paid by a person carrying on the business is allowed as business expenditure.
Correct Answer True
Your Answer True
Match The Following

Retrenchment Compensation Exemption can be claimed u/s 10(10B) of the Income Tax Act Terminal Compensation
Salary or wages for the purpose of calculating Death-Cum -Retirement Gratuity. Basic Salary plus Dearness allowance
Basic Salary plus Dearness allowance
Any amount of compensation received or receivable by the employee from the employer at the time of termination of his
employment or at the time of modification of terms and conditions in connection with the employment. Terminal
Compensation Treated as income from other sources.
Any Death-Cum-Retirement Gratuity received Treated as income from salary Treated as income from salary
True/False
Question Dividend received by the shareholder is treated as income chargeable to tax u/s 10(34) of the IT Act.
Your Answer False
Select The Blank

Question The valuation of perquisites in the case of interest free loans or the loans at the concessional rate of interest
will be the sum equal to the interest calculated at the rate charges by State Bank of India, on the first day of the relevant
previous year in respect of the loans for the same purpose. Such interest is calculated on the ________ monthly balance.
Correct Answer Maximum outstanding
Your Answer Minimum outstanding

Question For the purpose of calculating the value of perquisite of residential accommodation the term salary does not
include :-
Correct Answer Dearness Allowance , Employer's contribution to Provident Fund , Allowances which are exempt from
tax
Your Answer Dearness Allowance , Employer's contribution to Provident Fund

Correct Answer Salary earned in India even if paid outside India , Salary paid by Government to Indian national for
services rendered outside India , Tax deducted in India
Your Answer Salary earned in India even if paid outside India , Salary paid by Government to Indian national for
services rendered outside India , Income from any capital asset situated outside India
True/False
Question Any sum payable by the assessee as interest on any loan borrowed by him from any state financial corporation
as per the terms on the agreement is not allowed as deduction from profit as per P & L account, if they are actually paid
before the due date of furnishing return of income.
Your Answer True

Question What is the treatment of the perquisite in the form of Gas, electricity and water supplied to the employee?
Correct Answer If the facility of gas, electricity and water is supplied by the employer to the employee purchasing the
same from an outside agency, the valuation of perquisite will be the charges paid by the employer to the outside agency
supplying gas, electricity and water. , If the facility in the form of gas, electricity and water is supplied by the employer
out of his own resources, the valuation of perquisite will be the manufacturing cost per unit incurred by the employer.
Select The Blank

Question Dividends from the ________ is an exempt income and hence will not be included in the Taxable income.

Question The various payments which are referred as deductions under section 43B, Clause No-21 are :-
Correct Answer Any employees contribution payable by the assessee towards any Provident Fund or Superannuation
Fund or Gratuity Fund for the welfare of the employees , Any sum payable by the assessee by way of tax duty, cess or fee
, Any sum payable by the assessee as interest on any loan or borrowing made by him from any public financial institution
or state financial corporation as per the terms of the agreement

Question If the capital gains arise on account of compulsory acquisition of the capital asset under any law and any
compensation is paid for such acquisition :-
Correct Answer The capital gains liability will be computed in the previous year in which the compensation or the part
thereof is first received

Question What is the tax treatment of the Lump sum received from unrecognized provident fund on the retirement or
resignation or death of the employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest on employee's contribution is taxable as
"Income from Other Sources" , Employer's Contribution to PF and interest thereon is taxable as "Income from salaries"

Question The head of income in the form of Income from Salaries is applicable in respect of the :-
Correct Answer Remuneration received by an employee from the employer
Your Answer Remuneration received by an employee from the employer
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires company engaged in production, mining, and
manufacturing activities should maintain proper books of accounts showing the particulars of utilization of material,
labour or any other item.
Your Answer Section 209 of the Income Tax Act, 1961

Correct Answer It is an Indian Co. , It can be any other Co. , Has made prescribed arrangements for declaration and
payment of dividend


Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term "Specified Persons" may
include :-
Correct Answer Any partner of the firm or his relative , Any person having the substantial interest in the business or
profession of the firm or any director or partner of such company or firm or any relative of such person. , Any person who
carries on business or profession and in his business or profession the assessee or any partner of such firm or relative of
such partner has substantial interest.
True/False
Question Refund of Income tax is taxable as Income from other sources.
Select The Blank

Question Capital Gains are chargeable to Income Tax if there is any profit or gain arising from the transfer of a :-
45. Any loans or deposits borrowed or repaid under section 269SS of the Act provides
that the said provisions will not apply to the loans or deposits accepted by :-
a)
Government
b) Government company
c)
Insurance company
d)
Marks : 2
49. Any amount paid by an individual as tuition fees to any educational institution in
India for the purpose of full time education of the individual's children. The
maximum allowable limit is :-
a)
b) Subject to the maximum of two children.

c)
d)
Marks : 2
a)
Gross total income
b) Gross taxable income
Net income
c)
Tax amount
d)

Select The Blank

is higher.

Question Condition for deduction from Capital Gains arising from transfer
of House property under Section 54 is :-
Correct Answer Assessee must have purchased another residential property one
took place.
Your Answer Assessee must have purchased another residential property one
took place.
True/False
Your Answer True

for :-
industrial research
industrial research
Select The Blank

Question If a person, other than an individual or a HUF, is responsible to
pay the rent to any person in excess of ________ during the
financial year.

employees is included in their salaries and the deduction is
allowed to the extent of least of the following amounts :-
Allowance received.
Allowance received.
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires company
engaged in production, mining, and manufacturing activities
should maintain proper books of accounts showing the
particulars of utilization of material, labour or any other item.

Auditor is required to give the accounting calculation in ratios of
:-
trade/turnover
trade/turnover


True/False
Your Answer False

True/False
occupation, annual value of any one of the house property of his
own choice is treated as nil & another house as rented out.
Correct Answer True
Your Answer True

Question The specified assets for the purpose of claiming exemption from
Capital Gains u/s 54EC mean the bonds redeemable after 3
years issued by the following institutions
Correct Answer National Bank for Agriculture and Rural Development (NABARD)
Your Answer National Bank for Agriculture and Rural Development (NABARD)
Select The Blank

Correct Answer 0.35
Your Answer 0.3

Question Which of the following expenses should be debited to P & L
Account, but disallowed for Income tax purpose?
True/False
Question Any Employer's Contribution payable by the assessee towards
any provident fund or superannuation fund or gratuity fund or
any other fund for the welfare of the employees, if they are
actually paid, allowed as deduction.
Correct Answer True
Your Answer True

Your Answer 15000
Select The Blank

Correct Answer 0.01
Your Answer 0.01

Select The Blank

the age of ________ or more at any time during the previous
year.
Correct Answer 65
Your Answer 65
Select The Blank

Correct Answer 8
Your Answer 8



True/False
Your Answer True
True/False
Question Sales tax and expenses in connection with the proceedings for
the assessment of sales tax are allowed as business
expenditure.
Correct Answer True
Your Answer True
Match The Following

Perquisites Indicate benefits or Indicate benefits or

amenities provided by the amenities provided by the
employer to the employee, employer to the employee,
either free of cost or at the either free of cost or at the
concessional rate concessional rate
House Rent Allowance This indicates the amount This indicates the amount
paid by the employer to paid by the employer to the
the employee to meet the employee to meet the
expenditure for residential expenditure for residential
accommodation occupied accommodation occupied
by the employee by the employee
Retrenchment Compensation received Compensation received by
Compensation by a worker at the time of a worker at the time of
Traveling Allowance Any allowance granted to assistance received or due
meet the cost of travel on to an assessee from his
tour or on transfer of duty. employer, for himself and
his family for proceeding
on leave to any place in
India or to any place in
India after the retirement or
termination of his service

Question Foreign allowance received by an Indian national is exempt if it
is paid by :-

Question Following news agencies are specified by the Central
Government as specified news agencies :-

Question Annual value of any one palace in possession of a former ruler is
:-
True/False
Your Answer True

Question Section 35CCA of the Act applies to any expenditure incurred by
the assessee by way of payment of any sum to :-
Select The Blank

under this Section.

Correct Answer 0.3
Your Answer 0.3

contained in :-
Select The Blank


Question Any premium paid by the assessee by Cheque as an employer
to effect or keep in force an insurance on the health of his
employees is :-
profession
profession
True/False
Correct Answer True
Your Answer False
True/False
Your Answer False

years


taxable as :-
True/False
Question The payments made u/s 43B of the Income Tax Act are allowed
as deductions only if they are actually paid.
Correct Answer True
Your Answer True
Match The Following


etc.
100% 100%
60% 60%
Select The Blank

teachers etc under Section 80R is limited to ________% of such
remuneration brought in India.
Correct Answer 15
Your Answer 15
Select The Blank

the form of computers an electronic items, the wear and tear will
be calculated @ ________ %.
Correct Answer 50
Your Answer 20
Score Card
Registration
200404214
Number:
Name: Manpreet Malhotra
Subject: Taxation
Assignment Status
19/03/2006
As On:

Result Pass
Click here to view the list of attempted question and answers.

TTEMPTED QUESTIONS AND ANSWERS
Select The Blank

Question If the person responsible for deducting the tax at source and paying the same to the

Question Any amount deposited by an Individual or a HUF in 10 year or 15 year account unde
Select The Blank


Question Under Section 80U a person with disability means a person who is suffering from 40
Correct Answer Blindness , Mental Illness
Your Answer Blindness , Mental Illness
Select The Blank

Your Answer Gross profit

Question Following specific incomes are taxable under the heading income from other source
Your Answer Winning from betting , Interest on securities of local authority , Bonus from key man
Select The Blank

Your Answer Indian
Match The Following

If the employee
10% of is the
allowed
10%
actualof
tocost
the
useactual
of
anysuch
movable
cost
asset
of such
asset
or hire
asset
owned
charges
or or
hire
hired
incurred
charges
by the
byincurred
the
employer
employer
by theshall
employer
be conside
shall
For the purpose
The interest
of calculation
The
rates
interest
charged
of perquisites
ratesbycharged
StateinBank
case
by State
of
of India
Interest
Bank to of
be
free
India
considered
Loans
to beorconsidered
Loans at concessional rate
Perquisite Itinisrespect
taxableItofonly
isGas,
taxable
in Electricity
the only
hands inand
the
of specified
hands
Water of supplied
employee
specified to the
employee
employee
If the educational
The perquisites
institution
The perquisites
shall
is maintained
be taken
shalltoand
be
betaken
owned
the cost
to by
beofthe
the
education
employer
cost of in
education
a similarininstitution
a similar or
institution
near theorloc
n

Question Mr X has received Rs 200000 as income from salary, Rs 50000 income from house

Question The term '' building & land appurtenant thereto'' indicates :-
Correct Answer There must be a structure of permanent nature
Your Answer There must be a structure of permanent nature

Your Answer Members of parliament
Select The Blank

Correct Answer 0.01
Your Answer 0.01

Question Cost of acquisition of a Capital Asset is :-
Correct Answer The value for which it was acquired by the assessee
Your Answer The value for which it was acquired by the assessee

Question If the self occupied property is constructed or acquired with the borrowed capital afte

Select The Blank

Question If the CC of the engine is less than 1.6 liters and the motor car is owned or hired by
Correct Answer 400
Your Answer 400
Select The Blank

True/False
Question As per the provisions of the Act, any contribution made by an assessee as an emplo
Correct Answer TRUE
Your Answer TRUE
True/False
Question Interest is payable by the assessee for not paying the Advance tax or if the Advance
Your Answer FALSE

Question For Deduction u/s 54EC from Capital Gains the assessee should invest the whole o
Your Answer Within six months from the date of transfer of the long-term capital asset , Before th
True/False
Question Deduction u/s Section 80DD for Medical treatment of handicapped dependent is not
Your Answer FALSE

Question What is the tax treatment of the Lump sum received from unrecognized provident fu
Correct Answer Employee's contribution to PF is exempt from tax , Interest on employee's contributi
Your Answer Employee's contribution to PF is exempt from tax , Interest on employee's contributi
Select The Blank

Question Section 35D of the Act provides that the preliminary expenses can be ________ ove
True/False
Question Interest paid on the loan for acquiring a capital asset will be considered to be a part
Correct Answer TRUE
Your Answer FALSE

Question The total amount of rebates under Section 88, Section 88B, Section 88C and Sectio

Your Answer No Contribution
True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the company carried
Correct Answer TRUE
Your Answer TRUE
Question As per the provision of section 143(2) and 143(3) scrutiny assessment made by ass
Correct Answer Assessee has not understated the income , Assessee has not overstated the loss ,
Your Answer Assessee has not understated the income , Assessee has not overstated the loss


Question The entertainment allowance received by the Government employees is included in

Question Loss from speculation business can be adjusted :-
Correct Answer Only against the profits from speculation business.
Your Answer Only against the profits from speculation business.
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the form of motor c
Correct Answer 20
Your Answer 20
Match The Following

Question Correct Answer
Your Answer
Deduction Section
for Medical
80DD
Section
Treatment
80DDof handicapped dependent
Deduction Section
for Contribution
80CCC
Section
to 80CCC
Certain pension funds
Deduction Section
for Contribution
80CCD
Section
to 80CCD
pension scheme of Central Government
Deduction Section
for Payment
80DSection
of Medical
80D Insurance Premium

True/False
Question Bad Debts recovered not allowed as deduction in earlier years is not taxable in any
Correct Answer TRUE
Your Answer TRUE
True/False
Question A company is resident of India if in any previous year it is an Indian Company even t
Your Answer FALSE
Select The Blank

Question ________ of the Tax Audit Report refers to the details of various payments which ar
Your Answer Section 44AB Clause No-17

Your Answer 31st July of Assessment Year

Correct Answer 80 G Donations , 80 HHB profits and gains from projects outside India , 80 IA profits
Your Answer 80 G Donations , 80 HHB profits and gains from projects outside India , 80 IA profits

Question The following are the main types of income falling under the category of section 41 o
Correct Answer Any amount received during the previous year in respect of loss or expenditure whe
Your Answer Any amount received during the previous year in respect of loss or expenditure whe

Question Any amount paid by an individual as tuition fees to any educational institution in Indi
Correct Answer Rs. 12,000 per child per annum , Subject to the maximum of two children.
Your Answer Rs. 12,000 per child per annum , Subject to the maximum of two children.
True/False
Question A person who is a Senior Citizen who has attained the age of 65 years is not entitled
Your Answer FALSE
True/False
Question Rebates as per the provisions of Section 88C of the Act are not available from the ta
Your Answer TRUE

Question Condition for deduction from Capital Gains arising from transfer of House property u
Correct Answer Assessee must have purchased another residential property one year before or with
Your Answer Assessee must have purchased another residential property one year before or with
Select The Blank

Question The rebate u/s 88B is available to an individual who has attained the age of ______
Correct Answer 65
Your Answer 65
True/False
Question In case of deductions for medical treatment under Section 80DDB the amount of de
Correct Answer TRUE
Your Answer TRUE
urce and paying the same to the credit of Central Government has not been allotted the Tax Deduction Account Number (TA
10 year or 15 year account under the Post Office Saving Bank (CTD) Rules, 1959. The account can be in the name of :-
person who is suffering from 40% of the following disabilities :-
eading income from other sources :-

l authority , Bonus from key man insurance policy
l authority , Bonus from key man insurance policy
s incurred by the employer shall be considered to be the value of perquisite.

o be considered
cation in a similar institution or near the locality.
ry, Rs 50000 income from house property and he also received Rs 100000 income from specified units of the mutual fund. W
mption is exempt for :-
ired with the borrowed capital after 01.04.1999 maximum deduction will be :-
of income :-
e motor car is owned or hired by the employer and is used partly of official and partly for personal purposes and if running an
ade by an assessee as an employer, only the amount contributes to a recognized Provident Fund or an approved Superannu
he Advance tax or if the Advance tax paid by the assessee is less than 80% of the Assessed tax after adjusting the amount o
essee should invest the whole or part of the capital gains in the specified assets :-
ng-term capital asset
ng-term capital asset , Before the date of filing his return of income
of handicapped dependent is not available to HUF
d from unrecognized provident fund on the retirement or resignation or death of the employee?
Interest on employee's contribution is taxable as "Income from Other Sources" , Employer's Contribution to PF and interest t
Interest on employee's contribution is taxable as "Income from Other Sources" , Employer's Contribution to PF and interest t
expenses can be ________ over a period of 5 years commencing from the year of commencement of business.
et will be considered to be a part of cost of acquisition.
tion 88B, Section 88C and Section 88D of the Act. shall :-
sion scheme for the employees employed on or after 15th January, 2004. These employees are required to contribute 10%
ost Audit of the company carried out, the report of such audit should be enclosed to the Tax Audit Report.
crutiny assessment made by assessing officer in order to ensure that :-
ee has not overstated the loss , Assessee has under paid the taxes
ee has not overstated the loss
sion scheme for the employees employed on or after 15th January, 2004. These employees are required to contribute 10%
rnment employees is included in their salaries and the deduction is allowed to the extent of least of the following amounts :-
tainment Allowance received.
tainment Allowance received.
mployee is in the form of motor car, the wear and tear will be calculated @ ________ %.
arlier years is not taxable in any year.
ar it is an Indian Company even though control & management are situated outside India.
ails of various payments which are allowed as deduction only if they are actually paid for.
S from Salaries?
r chapter VI A are allowed

ojects outside India , 80 IA profits and gains of infrastructure companies
ojects outside India , 80 IA profits and gains of infrastructure companies
nder the category of section 41 of the Act, dealing with the deemed profits chargeable to tax and not credited to profit and lo
spect of loss or expenditure where deduction has been allowed in the assessment year of any earlier , Any amount recovere
spect of loss or expenditure where deduction has been allowed in the assessment year of any earlier , Any amount recovere
any educational institution in India for the purpose of full time education of the individual's children. The maximum allowable l
ximum of two children.
ximum of two children.
the age of 65 years is not entitled to the rebate u/s 88 of the Act.
Act are not available from the tax on long-term capital gains.
from transfer of House property under Section 54 is :-

l property one year before or within two years after the date on which transfer took place , Assessee must have constructed a
l property one year before or within two years after the date on which transfer took place , Assessee must have constructed a
has attained the age of ________ or more at any time during the previous year.
ection 80DDB the amount of deduction will be reduced by the amount received under an insurance policy or the amount reim
Deduction Account Number (TAN), he shall within ________ from the end of the month in which
ber.the tax was deducted,
Numapply
unt can be in the name of :-
ified units of the mutual fund. What will be his total income
onal purposes and if running and maintenance expenses are borne by the employee then
s Rs.600
the value
if carofisperquisite
chaufferplu
driven
will becar.
Rs.__
und or an approved Superannuation fund are allowed as deduction.

tax after adjusting the amount of TDS and Advance tax Paid
ontribution to PF and interest thereon is taxable as "Income from salaries"

ontribution to PF and interest thereon is taxable as "Income from salaries"
cement of business.
are required to contribute 10% of their salaries to this pension scheme. How much will the Central Government contribute to
Audit Report.
are required to contribute 10% of their salaries to this pension scheme and the Central Government will make an equal contr
ion o
ast of the following amounts :-

and not credited to profit and loss account :-
y earlier , Any amount recovered against a debt, where a deduction is allowed in respect ofhall
a bad
be deemed
debt in any
to be
of the
meearlier
profit
s inas t
y earlier , Any amount recovered against a debt, where a deduction is allowed in respect ofhall
a bad
be deemed
debt in any
to be
of the
meearlier
profit
s inas t
dren. The maximum allowable limit is :-
essee must have constructed another residential property within, three years after the date on which the transfer took place.
essee must have constructed another residential property within, three years after the date on which the transfer took place.
rance policy or the amount reimbursed by the employer.
ich
ber.the tax was deducted,
Numapply for the allotment of TAN
600value
if carofisperquisite
chaufferplu
driven
will becar.
Rs.________ per month
ntral Government contribute to the Fund?
nment will make an equal contribution.
ion of CentralHow
Government
will the contribut
be taxed?
allbad
be deemed
debt in any
to be
of the
meearlier
profit
s inassessment
the year in which
year, the
it issa
so recovered , If any asset used for scientific research is sold and the sa
allbad
be deemed
debt in any
to be
of the
meearlier
profit
s inassessment
the year in which
year, the
it issa
so recovered
n which the transfer took place.

n which the transfer took place.
entific research is sold and the sale proceeds along with benefits received by the assessee under section 35, exceeds the amou
der section 35, exceeds the amount of capital expenditure, the excess will be charged to income tax in the assessment year
me tax in the assessment year

Question Mr. X an employee of the Central Government receives Rs 3,50,000 as gratuity at the time of h
Correct Answer Nil
Your Answer Rs 3,00,000

Select The Blank

Question The amount paid by the employer to the employee to meet the expenditure for residential acco
Select The Blank

Question If the asset sold or transferred by the employer to employee is in the form of computers an ele
Correct Answer 50
Your Answer 50

Question In respect of leave travel concession If Mr. A has availed the exemption only once or has not a
Correct Answer He can carry over the exemption to the next block of four years i.e. 2002-2005 provided that he
Your Answer He can carry over the exemption to the next block of four years i.e. 2002-2005 provided that he
True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both tangible as well as i
Correct Answer TRUE
Your Answer FALSE

Your Answer Cheque
Select The Blank

Question It should be noted that the tax liability of an individual having the total income of less than Rs _

Question For the purpose of calculating the value of perquisite of residential accommodation the term sa
Correct Answer Dearness Allowance , Employer's contribution to Provident Fund , Allowances which are exem
Your Answer Dearness Allowance , Employer's contribution to Provident Fund , Allowances which are exem

Question Any amount received by the assessee under a Keyman Insurance Policy including the bonus o
Your Answer Taxable under the head salaries
True/False
Question Any expenditure incurred for earning the income which is included under the head income from
Correct Answer TRUE
Your Answer TRUE

Correct Answer All returns to or correspondence with the Income Tax Authorities , All the challans for the paym
Your Answer All returns to or correspondence with the Income Tax Authorities , All the challans for the paym
Select The Blank

Question The person who does not deduct the tax source as required by the Act or after deducting fails
Correct Answer 1
Your Answer 1
Select The Blank

Question Mr. Ram is employed by the Central Government as accountant whose gross salary income is

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a firm, the term "Specified Per
Correct Answer Any partner of the firm or his relative , Any person having the substantial interest in the busine
Your Answer Any partner of the firm or his relative , Any person having the substantial interest in the busine

Question The provisions for payment of gratuity is not allowed under section 40A(7) but, under the head
Correct Answer The amount of gratuity has actually become payable to the employees during the previous yea
Your Answer The amount of gratuity has actually become payable to the employees during the previous yea
True/False
Question Loss under the head Profits from Business or Profession can be adjusted against the Income f
Your Answer FALSE
Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of various payments are allowed as
Your Answer Mercantile system of accounting
Select The Blank

Question If assessee owns more than one house properties, he can get benefit of nil annual value for an

Question The least of the following is the exemption available to an employee if he is in receipt of house
Correct Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata, Chennai and De
Your Answer 50% of the Salary where such accommodation is situated in Mumbai, Kolkata, Chennai and De
Select The Blank

Question For an individual as a citizen of India who leaves India in the relevant previous year for the pur
Correct Answer 182
Your Answer 182

Your Answer Capital gains
True/False
Question Income earned & received outside India & remitted to India is taxable for resident & ordinary re
Correct Answer TRUE
Your Answer TRUE


Question All intangible assets like Patents, Trade Marks, Copy Rights, Licenses etc. have the depreciati
Correct Answer 0.25
Your Answer 0.25

Correct Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly and exclusively in conn
Your Answer Cost of acquisition , Cost of improvement , Expenditure incurred wholly and exclusively in conn

Match The Following

Question Correct AnswerYour Answer
DisallowedInterest,
if tax has
royalty
Interest,
not been
androyalty
deducted
fees for
andtechnical
or
fees
after
fordeduction
services
technicalwhich
has
services
not
is payable
been
whichpaid
is
outside
payable
before
India
the
outside
or
expiry
in India
India
of time
or
to in
aprescribed
non-residen
India to a n
u
20% of Expenditure
If an assessee
is
If disallowed
an incurs
assesseeany
under
incurs
expenditure
Section
any expenditure
40A(3)
in respect in
of respect
which payment
of whichispayment
made inisa made
sum exceeding
in a sum exceedin
Rs. 20,0
Allowed Expenditure
Interest paidInterest
to sales
paid
tax
todepartment
sales tax department
on arrearsonof arrears
sales Tax
of Payable
sales Tax Payable
DisallowedPenalty
Revenue paid
Penalty
Expenditure
for thepaid
delayed
for theremittance
delayed remittance
of delayedofPFdelayed
dues PF dues

Question Which section of the Act provides that an assessee may follow a system of accounting to calcu
Match The Following

Your Answer
Rebate Under
Is available
Section
Isto
88C
available
a woman to assessee
a woman below
assessee the age
below of the
65 years
age ofat65anyyears
timeatduring
any time
the during
previoustheyears.
previous ye
Jeevan Dhara
Deferred
or Jeevan
Annuity
Deferred
Akshay
Plan
Annuity
of LlCPlan of LlC
Any amount
Anypaid
educational
by an
Anyindividual
educational
institution
as tuition
in
institution
India
fees
forinis
the
India
eligible
purpose
forfor
theof
rebate
purpose
full time
u/sof
education
88full
only
time
if payment
education
of the individual's
is of
made
the individual's
to
children. child
Rebate Under
Is available
Section
Isto
88B
available
an individual
to an who
individual
has attained
who hasthe attained
age of the
65 or
agemore
of 65 ator
anymore
timeatduring
any timethe during
previous
theyear.
prev

Correct Answer Employer's Contribution to PF is not liable for any tax payment , Interest credited to the employ
Your Answer Employer's Contribution to PF is not liable for any tax payment , Interest credited to the employ
Select The Blank

Question ________ expenditure should not be allowed as expenditure u/s 37 (1) of the Income Tax Act.
Your Answer Capital
True/False
Question Entertainment Allowance is available for deduction only for the Government Employees.
Correct Answer TRUE
Your Answer TRUE

Question As a general principle, the Basic Salary or Wages, Dearness Allowance and Bonus / Commiss
True/False
Question The consideration for transfer of Capital Asset is received by the transferor is not material whil
Correct Answer TRUE
Your Answer TRUE
Select The Blank
Question Any expenditure incurred by a company for promoting the family planning among its employee
Correct Answer 1/5th
Your Answer 1/5th

Question The amount of capital gains not invested by the assessee for the purchase or construction of t

True/False
Question Dividend received from domestic company to its shareholders is taxable in the hands of the sh
Your Answer FALSE
True/False
Correct Answer TRUE
Your Answer TRUE
True/False
Question If assessee owns more than one house properties, for his self occupation, annual value of any
Correct Answer TRUE
Your Answer TRUE

True/False
Question If the amount of tax payable by the assessee is higher than the combined amount of tax deduc
Correct Answer TRUE
Your Answer TRUE

Your Answer A notional value
Select The Blank

Question Free meals provided by the employer during the office hours provided that the value per meal
Correct Answer 50
Your Answer 50

50,000 as gratuity at the time of his retirement on September, 2004 under new pension code, the total taxable income will be
from tax :-
e expenditure for residential accommodation occupied by the employee is called ________.
s in the form of computers an electronic items, the wear and tear will be calculated @ ________ %.
exemption only once or has not availed any exemption at all, in the block of four years i.e. 1998-2001 then :-
rs i.e. 2002-2005 provided that he avails the exemption of LTC in the first calendar year of the next block i.e. 2002.
rs i.e. 2002-2005 provided that he avails the exemption of LTC in the first calendar year of the next block i.e. 2002.
ncludes both tangible as well as intangible assets.
he total income of less than Rs ________ is Nil u/s 88D.

ntial accommodation the term salary does not include :-
nd , Allowances which are exempt from tax
nd , Allowances which are exempt from tax
ance Policy including the bonus on such policy is :-
uded under the head income from other sources will be allowed as deduction from such income provided that certain conditio
ties , All the challans for the payment of any amount under the Act , All the documents pertaining to purchase, sale and bank
ties , All the challans for the payment of any amount under the Act , All the documents pertaining to purchase, sale and bank
y the Act or after deducting fails to pay the tax as required by the Act, shall be liable to pay the simple interest @________ %
nt whose gross salary income is Rs 6,00,000. He can claim standard deduction of Rs ________ u/s 16(i) of the IT Act.
is a firm, the term "Specified Persons" may include :-

substantial interest in the business or profession of the firm or any director or partner of such company or firm or any relative
substantial interest in the business or profession of the firm or any director or partner of such company or firm or any relative
ction 40A(7) but, under the head, profits from business and profession, the amount of gratuity will be allowed as deduction o
ployees during the previous year , The provision has been made for the payment of a sum by way of contribution to an appr
ployees during the previous year , The provision has been made for the payment of a sum by way of contribution to an appr
be adjusted against the Income from Salaries.
various payments are allowed as deductions only if they are actually paid but, where if the assessee follows the ________, th
t benefit of nil annual value for any one house property ________.
ployee if he is in receipt of house rent allowance :-

umbai, Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is situated at any other place. , Actual
umbai, Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is situated at any other place. , Actual
elevant previous year for the purpose of employment has to be in India for ________ days or more during previous year.
Agent of NRI
Agent of NRI
Licenses etc. have the depreciation rate of :-
ation over the following amounts -

ed wholly and exclusively in connection with the transfer
ed wholly and exclusively in connection with the transfer
Purchase of machinery
le outside India or in India to a non-resident (not being a company or a foreign company)

ment is made in a sum exceeding Rs. 20,000 otherwise than by a crossed cheque or a crossed demand draft
w a system of accounting to calculate the income from business and profession and income from other sources?
at any time during the previous years.
education of the individual's children.

more at any time during the previous year.
t , Interest credited to the employee's account is not liable for any tax payment. , The lump sum received at the time of retire
t , Interest credited to the employee's account is not liable for any tax payment. , The lump sum received at the time of retire
u/s 37 (1) of the Income Tax Act.
e Government Employees.
the transferor is not material while Capital gain chargeable to tax.

ily planning among its employees is allowed as expenditure. If such expenditure is of capital nature, ________ of such expe
the purchase or construction of the new property can be deposited by the assessee under the Capital Gains Account Schem
is taxable in the hands of the shareholder.
f occupation, annual value of any one of the house property of his own choice is treated as nil & another house as rented out
m No. 2C is
e combined amount of tax deducted at source and advance tax, such tax along with the amount of interest payable should b
provided that the value per meal does not exceed Rs. ________.
es the amount of :-
the total taxable income will be :-
8-2001 then :-
e provided that certain conditions are satisfied
ing to purchase, sale and bank transactions

ing to purchase, sale and bank transactions
e simple interest @________ % per month on the amount of such tax from the
such
date
taxon
is which
actually
thepaid.
taxhich
was deductible till the d
__ u/s 16(i) of the IT Act.
company or firm or any relative of such person. , Any person who carries
on the
onassessee
business or
or any
profession
partner
essi andof such
in his
firm
business
or relative
or pro
company or firm or any relative of such person. , Any person who carries
on the
onassessee
business or
or any
profession
partner
essi andof such
in his
firm
business
or relative
or pro
will be allowed as deduction only when :-

y way of contribution to an approval gratuity , The other than the above two situations, any provision made for the payment o
y way of contribution to an approval gratuity , The other than the above two situations, any provision made for the payment o
sessee follows the ________, the payments can be claimed on due basis.
ted at any other place. , Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the Salary.
ted at any other place. , Actual amount of HRA received by the employee. , Excess of rent paid over 10% of the Salary.

ed demand draft
rom other sources?
m received at the time of retirement or resignation or death is also exempt under section 10(11) and 10(12).
m received at the time of retirement or resignation or death is also exempt under section 10(11) and 10(12).
nature, ________ of such expenditure is allowed in the year in which it is incurred.
Capital Gains Account Scheme :-
& another house as rented out.
unt of interest payable should be paid by the assessee at the time of filing the return of income
ually
thepaid.
taxhich
was deductible till the date on w
y partner
ession
essi andof such
in his
firm
business
or relative
or prof
of such partner has substantial interest.
y partner
ession
essi andof such
in his
firm
business
or relative
or prof
of such partner has substantial interest.
ovision made for the payment of gratuity is not allowed as deduction

ovision made for the payment of gratuity is not allowed as deduction
id over 10% of the Salary.
id over 10% of the Salary.
1) and 10(12).
1) and 10(12).
Question The entertainment allowance received by the Government employees is included in
their salaries and the deduction is allowed to the extent of least of the following amounts :-
Correct Answer
Actual amount of Entertainment Allowance received. , Rs. 5,000 , 1/5th of Salary
True/False
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method as well as.
straight line method for the computation of depreciation u/s 32 this act
Correct AnswerFALSE
Correct Answer
Operation of Ship , Hotels situated in hilly area, rural area or place of pilgrimage ,
Correct Answer
Expenditure incurred as discount on issue of debentures
Select The Blank
Correct Answer
Grossed up
True/False
Correct Answer TRUE
is Rs. 1,45,000, wants to make the investments in the following alternative forms
Rs. 80,000 in PPF and Rs. 20,000 in Infrastructure Bonds. The amount of rebate:-
available to him u/s 88 is
Correct Answer
Rs. 18,000
Correct Answer
Non resident Indian
True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both tangible
as well as intangible assets.
Correct Answer TRUE
Question Deductions in respect of Certain Incomes received under Section 80L
is available in respect of 1
Correct Answer
Interest on Central or State Government Securities , Interest on
NSCs Interest on National Saving Scheme, 1992 (NSS) , Bank Interest
Correct Answer
Residential status
Correct Answer
Perquisites which are taxable in case of all types of employees , Perquisites which are
Select The Blank
Question For an individual as a citizen of India who leaves India in the relevant previous year
for the purpose of employment has to be in India for ________ days or more during py
Correct Answer 182
Correct Answer
Assessment year
Correct Answer
Town planning , Company secretary , Accounting
Select The Blank
Correct Answer
Section 43B Clause No-21
Correct Answer
Short Term Capital Gains. , Long term Capital Gains
Select The Blank
Correct Answer
Free Trade Zone
Correct Answer
1st April to 31st March
Correct Answer
Gross total income
Correct Answer
Only one journey can be carried forward to the next block.
Select The Blank 2
Correct Answer
Form No. 49A
of :-
Correct Answer
Any Long Term Capital Asset
Select The Blank
response to the notice under section 142, the assessment officer undertakes ________
as per section 143(2) and section 143(3).
Correct Answer
Scrutiny Assessment
Correct Answer
Supervision , Control , Encouragement
True/False
Correct Answer TRUE
Correct Answer
He can carry over the exemption to the next block of four years i.e. 2002-2005 provided
Question The amount accumulated to the credit of the employee's provident fund account is paid
at the time of :-
Correct Answer
Retirement , Resignation
Correct Answer
Standard deduction , Interest on borrowed capital , Municipal taxes
Commission is :-
Correct Answer
Fully taxable.
Correct Answer
80 G Donations , 80 HHB profits and gains from projects outside India , 80 IA profits
Correct Answer
Exempt
Select The Blank 3
to be reinvested :-
Correct Answer
And qualifies for tax rebate under section 88.
Select The Blank
Correct Answer 10
True/False
Select The Blank
Correct Answer
Permanent physical disability
Match The Following
DisallowableLitigation Expenses in connection with recovery of a debt which is not a trading debt
Expenditure
Capital Expenditure incurred by a company with the issue of rights shares
Expenditure
True/False
Question Any recreational facility provided by the employer to a group of employees
(not being restricted to a select few employees) is not exempt from tax.
Correct Answer
FALSE
True/False
deduction will be reduced by the amount received under an insurance policy or the
amount reimbursed by the employer.
Correct AnswerTRUE
True/False
Question Any advance tax paid before 31st March is treated as advance tax paid during the py.
Correct AnswerTRUE
Correct Answer
Gross annual value
4

Correct Answer
Government of India
Correct Answer
Developing, maintaining or operating any infrastructure facility where the term infrastructure
facility means a road (including a toll road, a bridge or a rail system) or a highway project
or a water supply project. , Developing, maintaining or operating an industrial park or
special economic zones notified by the Central Government , Generation or distribution
of power
True/False
Correct Answer
FALSE
Correct Answer
31st October of the respective Assessment year
Question The amount of accumulated interest on NSCs purchased in the earlier years is assumed to
be reinvested :-
Correct Answer
True/False
Question A person who is a Senior Citizen who has attained t
he age of 65 years is not entitled
to the rebate u/s 88 of the Act.
Correct Answer
FALSE
Question The total amount of rebates under Section 88, Section 88B, Section 88C and Section 88D of
the Act. shall :-
Correct Answer
Not exceed the amount of tax calculated on the total income.
True/False
Question A company is resident of India if in any previous year it is an Indian Company even though
control & management are situated outside India.
Correct Answer
FALSE
Correct Answer
80 G Donations , 80 HHB profits and gains from projects outside India ,
80 IA profits and gains of infrastructure companies
True/False 5
Correct AnswerTRUE
Match The Following
Deductions of Rent, Rates, Repairs, Taxes and Insurance on Buildings are available
u/s 30
Deduction of Depreciation is available u/s 32
u/s 37
u/s 31
approved mutual fund or of Unit Trust of India in accordance with a notified scheme
(Equity Linked Savings Scheme) :-
Correct Answer
The maximum allowable limit is Rs. 10,000
True/False
expenditure incurred by the employee shall be taken as perquisites unless the said expenses
are incurredwholly and exclusively for official purposes.
Correct AnswerTRUE
Correct Answer
Rebate u/s 88 for such amount not exceeding Rs. 20,000
True/False
Correct AnswerTRUE
Correct Answer
Winning from betting , Interest on securities of local authority , Bonus from key man
insurance policy
True/False
Correct AnswerTRUE
True/False
Question Income earned & received outside India & remitted to India is taxable for resident
& ordinary resident
Correct AnswerTRUE 6
Correct Answer
30th June of Assessment Year
Correct Answer
50% of the Salary where such accommodation is situated in Mumbai, Kolkata, Chennai
and Delhi and 40% of the Salary when the accommodation is situated at any other place. ,
Actual amount of HRA received by the employee. , Excess of rent paid over 10% of
the Salary.
Select The Blank
employer and is used partly of official and partly for personal purposes and if running and
maintenance expenses are borne by the employee then the value of perquisite will be
Correct Answer 600
Commission is :-
Correct Answer
Fully taxable.
Correct Answer
Gross profit/turnover , Net profit/turnover , Stock in trade/turnover
Correct Answer 0.1
Select The Blank
Correct Answer 0.35
True/False
paid by the assessee is less than 80% of the Assessed tax after adjusting the amount of
TDS and Advance tax Paid
Correct AnswerFALSE
Correct Answer
Perquisites which are taxable in case of all types of employees , Perquisites which are
Correct Answer
Only the income arising out of the same activity
Correct Answer
Municipal valuation
True/False
Question Dividend received from domestic company to its shareholders is taxable in the hands of the
shareholder.
Correct AnswerFALSE
Select The Blank
Correct Answer
Indian

Question Section 35D applies to the preliminary expenses incurred by a company, which consists of :-
Correct Answer
Expenditure in connection with the preparation of feasibility/project report, engineering
services, or conducting market survey , Legal charges and fees for registering the company
as per the provisions of company Act, 1956 , Charges in connection with drafting and printing
of memorandum of association and Articles of Association
Question Perquisites which are taxable only in the hands of specified employee include the following
categories of perquisites :-
Correct Answer
Motor Car , Services of sweeper, gardener, watchman or personal attendant , Gas,
Select The Blank
can be carried forward and set off in the subsequent Assessment Years against the
Correct Answer
Long term Capital Gains
Correct Answer
There needs to be an employer-employee relationship between the payer and the payee.
Your AnswerThere needs to be an employer-employee relationship between the payer and the payee.
True/False
Correct Answer TRUE
True/False
employee on credit card and which are paid by the employer shall be added as the
perquisites unless the said expenses are incurred wholly and exclusively for official purposes.
Correct Answer TRUE 7
Question The amount of advance tax payable by corporate assessees before 15th September of Py is :-
Correct Answer
45% of advance tax payable
Correct Answer
Section 139(1)
Select The Blank
Correct Answer
Excise duty
Correct Answer
Form No. 1
Correct Answer
Gross Total Income
Your AnswerGross Total Income
Select The Blank
Correct Answer
Normal Tax rates
Correct Answer
Correct Answer
Individual , Hindu Undivided Family.
Taxation-Saroj2
Select The Blank

Correct Answer 182
Multiple Choice Single Answer 8
Select The Blank
Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax rebate
of ________u/s 88C of the IT Act.
interest in the company by having 20% or more of the voting power , The employee whose income
under the head salaries (including all the taxable monetary payments of salary but excluding the value of
any non-monetary benefits or perquisites), after allowing deductions under Section 16, exceeds
Rs. 50,000
True/False
Question Deduction u/s 80E for repayment of loan taken for higher education is available if the loan
must have borrowed by the assessee himself or his Father
True/False
Question The consideration for transfer of Capital Asset is received by the transferor is not material
while Capital gain chargeable to tax.
Correct Answer True
Correct Answer Banking company including cooperative bank and post office savings bank ,
Government , Government company
Match The Following

Employee stock option plan ESOPS
Uncommuted Pension Indicates the periodical payment of pension Indicates

9
True/False
Question A person who is a Senior Citizen who has attained the age of 65 years
is not entitled to the rebate u/s 88 of the Act.
Select The Blank
Correct Answer 8
Match The Following

_

Select The Blank
Select The Blank
Correct Answer None
Select The Blank
Question Deduction for remuneration from foreign sources for professors, teachers etc under Section
80R is limited to ________% of such remuneration brought in India.
Correct Answer 15
Select The Blank
received ________.
Select The Blank
Question Which of the following amounts credited to P & L Account but not taxable from Income
tax Purposes as Profits from Business and Profession?
True/False
Correct Answer True
Select The Blank
Question If assessee owns more than one house properties, he can get benefit of nil annual value for
any one house property ________.
head, profits from business and profession, the amount of gratuity will be allowed as deduction only
when :-
Correct Answer The amount of gratuity has actually become payable to the employees during the py ,
The provision has been made for the payment of a sum by way of contribution to an approval gratuity , T
he other than the above two situations, any provision made for the payment of gratuity is not allowed
as deduction
Question: The amount of advance tax payable by non corporate assessees before 15th Dec. of py
Select The Blank
Rs ________ is Nil u/s 88D.
True/False
Correct Answer True
True/False
Select The Blank
Question The rebate u/s 88B is available to an individual who has attained the age
of ________ or more at any time during the previous year.
Correct Answer 65
contribution is taxable as "Income from Other Sources" , Employer's Contribution to PF and interest
True/False
Question Any advance tax paid before 31st March is treated as advance tax paid during the py.
Correct Answer True
True/False
Correct Answer True
Question The amount of advance tax payable by non corporate assessees before 15th June of p y:-
Correct Answer Nil
True/False
Correct Answer True
True/False
Select The Blank
Question Monetory Limit for deduction for royalty income of authors under Section 80QQB is Rs.________.
Question Income from winning from lotteries / crossword puzzles/ horse races is taxed at flat rate of :-
Correct Answer 0.3
Correct Answer
Assessment year
Correct Answer
Cheque
True/False
Correct AnswerFALSE
True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both tangible as
well as intangible assets.
Correct Answer TRUE
Question What is the tax treatment of Statutory Provident Fund? 13
Correct Answer
Employer's Contribution to PF is not liable for any tax payment , Interest credited to the
employee's account is not liable for any tax payment. , The lump sum received at the time
of retirement or resignation or death is also exempt under section 10(11) and 10(12).
Select The Blank
incurred under section 3________, for an Indian company the aggregate of all the
expenditure can be 5% of the cost of project or 5% of capital employed whichever is higher.
Correct Answer
5% of the cost of project or 5% of capital employed
Correct Answer
Gross total income
Correct Answer
31st March
Correct Answer
The Finance Act
Select The Blank
Correct Answer
As per his choice
Correct Answer
Residential status
Correct Answer
Purchase of Building , Purchase of machinery
Correct Answer
An individual , A HUF
Your Answer

Correct Answer
He can carry over the exemption to the next block of four years i.e. 2002-2005 provided
True/False
Correct AnswerFALSE
Question The amount paid by the employer to the employee on his retirement is taxed as :- 14
Correct Answer
Income from Salaries
Select The Blank
Correct Answer 182
True/False
Correct Answer TRUE
Correct Answer

Question The amount of advance tax payable by non corporate assessees before 15th March of Py:-
Correct Answer

Question An assessee can claim deduction under section 35 in relation to the expenditure incurred on
scientific research in the field of natural gas or applied sciences if :-
Correct Answer
Any revenue expenses incurred by the assessee for carrying out the scientific research
provided that such research is related to his business , Any capital expenses incurred by 2005
related to his business , The assesse is a company engaged in the business of
bio-technology or any other notified product a weighted deduction of 150% is allowed
in respect of in-house research and development expensed, till 31st March,
Select The Blank
Correct Answer
Authorized
True/False
Question If a person is required to quote the PAN and he quotes or intimates a false number then he
may be liable to pay a penalty of Rs. 25000.
Correct Answer
FALSE
Correct Answer
Employee's contribution to PF is exempt from tax , Interest on employee's contribution is
taxable as "Income from Other Sources" , Employer's Contribution to PF and interest
Select The Blank 15
of Central Government has not been allotted the Tax Deduction Account Number (TAN),
he shall within ________ from the end of the month in which the tax was deducted, apply f
or the allotment of TAN Number.
Correct Answer
One month
Match The Following
Deduction in case of permanent physical disability Section 80U
Deductions for Donations Paid Section 80G
Deduction for Rent Paid Section 80GG
Deduction in respect of Interest on Bank Deposits Section 80L

True/False
Question If the capital asset becomes the property of the assessee by virtue of gift or will, the period
for which the capital asset is held by the previous owner should be excluded while deciding
the holding period.
Correct AnswerFALSE
True/False
Question Amount paid by the employer in respect of any leave standing to the credit of the employee
after the date of furnishing return of income, this sum was payable in the previous
year is allowed as deduction.
Correct AnswerFALSE
Select The Blank
allowed as deductions only if they are actually paid but, where if the assessee follows the
________, the payments can be claimed on due basis.
Correct Answer
Mercantile system of accounting
True/False
Correct AnswerTRUE
Correct Answer
Resident , Non resident , Resident but not ordinary resident
Correct Answer
Allowed as expenses while calculating profits from business and profession
Question Assessee gets deduction of interest paid on borrowed capital even if he :- 16
Correct Answer
Takes possession later on , Acquires later on
Match The Following
cost or at the concessional rate
House Rent This indicates the amount paid by the employer to the employee to meet the expenditure
Allowance
Retrenchment Compensation received by a worker at the time of retrenchment
Compensation
Traveling Any allowance granted to meet the cost of travel on tour or on transfer of duty.
Allowance
Select The Blank

Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax rebate of ________
u/s 88C of the IT Act.
Correct Answer
Rs. 5,000
Correct Answer
1st April to 31st March
Correct Answer
Whole of its income will be taxable
Correct Answer
Individuals
True/False
Correct Answer
If the debentures are issued by a widely held company and the debentures are listed on a
stock exchange and if the amount of interest does not exceed Rs. 2,500 during the financial
year. , If the interest paid is on State or Central Government Securities, If the debentures
are issued by an institution, authority, Public Sector Company or cooperative society
as the Central Government may notify.
Select The Blank
Question Expenditure incurred by an assessee on advertisement in any brochure, tract,
by a ________shall not be allowed as business expenditure.
Correct Answer
Political party 17
VV - 1ST TAXATION
Select The Blank
Question If the property becomes the property of the assessee before ________,
the Fair Market Value of the property of the capital asset on that date will be considered
to be the cost of acquisition
Select The Blank
Question If the asset sold or transferred by the employer to employee is in the
form of motor car, the wear and tear will be calculated @ ________ %.
Correct Answer 20
Select The Blank
Question Income from other sources covers agricultural income from land situated :-
Correct Answer
The Finance Act
Your AnswerThe Finance Act

Question In case of any contribution made by an individual or a HUF to
notified units of any approved mutual fund or of Unit Trust of India in accordance with a
notified scheme (Equity Linked Savings Scheme) :-
Correct Answer
The maximum allowable limit is Rs. 10,000
True/False
Question Any advance tax paid before 31st March is treated as advance
tax paid during py
Correct Answer TRUE
Select The Blank
Question If sum received is net of TDS then it is ________ to include in
income from other sources.
Correct Answer
Grossed up
Question The person responsible for paying to any person any income by way
of winnings from lotteries or crossword puzzles or card games or games of any kind
shall be required to deduct the tax , at the time of making the payment.
However, no tax is required to be deducted if the amount of payment does not exceed :-
Correct Answer
Rs. 5000
Question The exemption for Leave travel Concession u/s 10(5)is available in
respect of how many children Born after 1st October 1998?
Correct Answer
Only 2
Match The Following
Question Your Answer
Any subscription
made to National Saving Scheme
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs. 2,50,000
during the Assessment Year 2005-2006. He invested Rs. 50,000 in the tax saving
bonds of ICICI on 10th June 2004. His tax liability for the A Y 2005-2006.
Is eligible for rebate u/s 88D
RS.12,500
Multiple ChoiceIncome
Singlefrom
Answer
winning from lotteries / crossword puzzles/ horse races is
Correct Answer 0.3
Multiple ChoiceTaxSingle
liability
Answer
of a person is based on :-
Correct AnswerResidential status
Multiple ChoiceIncome
Singleearned
Answer
in previous year is subjected to tax in :-
Correct AnswerAssessment year
Multiple ChoiceFollowing
Multiplepersons
Answer are deemed to be an assessee :-
Question Legal heir of deceased person , Parents of minor assessee , Agent of NRI
Multipleincomes
Answerare deemed to have accrued or arisen in India :-
Salary earned in India even if paid outside India , Salary paid by Government
to Indian national for services rendered outside India , Tax deducted in India
Select The Blank
Free meals provided by the employer during the office hours provided that the
value per meal does not exceed Rs. ________.
50
Select The Blank
Non resident individual satisfies ________ of the basic conditions.
None
Multiple ChoiceDeduction
Single Answer
in respect of Contribution to certain pension funds is related to :-
Section 80CCC 19
True/False If a person is required to quote the PAN and he quotes or intimates a false No.
then he may be liable to pay a penalty of Rs. 25000.
FALSE
Multiple ChoiceTheSingle
paymentsAnswer
for claiming the rebate u/s 88 should :-
Be made out of the income chargeable to tax.
Select The Blank
It should be noted that the tax liability of an individual having the total income
of less than Rs ________ is Nil u/s 88D.
1,00,000
Multiple ChoiceWhatSingle
is theAnswer
due date for filing Annual return for TDS from payment of interest?
True/False If the capital asset becomes the property of the assessee by virtue of gift or will, .
the period for which the capital asset is held by the previous owner should be
excluded while deciding the holding period
FALSE
Multiplefrom
Answer
Capital Gains from the transfer of residential house property
Individual , HUF
Multiple ChoiceAnyMultiple
amount Answer
paid by an individual as tuition fees to any educational institution in
India for the purpose of full time education of the individual's children. The maximum allowable
limit is :-
Rs. 12,000 per child per annum , Subject to the maximum of two children.
Multiple ChoiceCombined
Single Answer
total of five heads of income equals :-
Gross total income
Select The Blank
Under section 43B, Clause N0-21 provides that the details of various payments
are allowed as deductions only if they are actually paid but, where if the assessee follows
the ________, the payments can be claimed on due basis.
Mercantile system of accounting
Multiple Choice
Value
Single
at which
Answer
house property is offered for taxation under the head income
from house property is :-
Annual value
Select The Blank
________ is the tax payable on the manufacturing of goods.
Excise duty
Select The Blank
The basic requirement of section 37 is that the expenditure should have been
incurred by the assessee ________ for the purpose of business.
Wholly and exclusively
True/False Income of a mutual fund is taxable even if it is authorized by RBI.
FALSE
Multiple Choice
WhatSingle
is a Keyman
Answer Insurance Policy?
Policy taken by a person (usually employer) on the life of another person (usually
Match The Following
Your Answer 20
Question No exemption Available .
Superannuation Fund It is an employee welfare
scheme
Statutory Provident Fund
Recognized Provident Fund
True/False The amount of expenses including membership fees and annual fees incurred by
the employee on credit card and which are paid by the employer shall be
added as the perquisites unless the said expenses are incurred wholly and
exclusively for official purposes.
TRUE
Multiple Choice
In case
Single
theAnswer
assessee is not a company, a person(other than a company)
who is falling under One by Six economic criteria, the last date for filing the
return is prescribed as :-
31st July of the Assessment year
Multiple Choice
Gross
Single
Annual
Answer
Value can not exceed :-
Standard rent
Multiple Choice
In case
Multiple
of Payment
Answerof Interest on Securities no tax is required to be deducted
under the following circumstances :-
Question If the debentures are issued by a widely held company and the debentures are
listed on a stock exchange and if the amount of interest does not exceed Rs.
2,500 during the financial year. , If the interest paid is on
State or Central Government Securities , If the debentures are issued by an institution,
authority, Public Sector Company or co-operative society as the Central
True/False The consideration for transfer of Capital Asset is received by the transferor is
not material while Capital gain chargeable to tax.
TRUE
Select The Blank
Expenditure incurred in connection with the local festivals like Diwali etc.
are ________ as business expenditure.
Allowed
Multiple Choice
Income
Multiple
received
Answer
by following assesses is taxable in India :-
Resident , Non resident , Resident but not ordinary resident
Multiple Choice
Previous
Singleyear
Answer
always ends on :-
31st March
True/False If the debentures are converted into shares, it is considered to be transfer .
of the capital asset
FALSE 21
True/False Any expenditure incurred for earning the income which is included under the
head income from other sources will be allowed as deduction from such income
provided that certain conditions are satisfied
TRUE
VV - 2ND TAXATION
Multiple Choice
In case
Single
of the
Answer
individual or HUF whose Gross Total Income, before deductions
No rebate will be available u/s 88.
Multiple Choice
AnySingle
amountAnswer
received by the assessee under a Keyman Insurance Policy
including the bonus on such policy is :-
Taxable under the head salaries
True/False The value of benefit resulting from the payment made by the employer in a club
for any expenditure incurred by the employee shall be taken as perquisites unless
TRUE
Select The Blank
Deduction for remuneration from foreign sources for professors, teachers etc
under Section 80R is limited to ________% of such remuneration brought in
India.
15
Multiple Choice
TheMultiple
least of the
Answer
following is the exemption available to an employee if he is
in receipt of house rent allowance :-
50% of the Salary where such accommodation is situated in Mumbai, Kolkata,
Chennai and Delhi and 40% of the Salary when the accommodation is situated at any other
place. , Actual amount of HRA received by the employee. , Excess of rent paid over
10% of the Salary.
Select The Blank
For an individual as a citizen of India who leaves India in the relevant previous
year for the purpose of employment has to be in India for ________ days or more during py
182
Multiple ChoiceForSingle
filing the
Answer
returns of income, Form No. 2C is to be filled in by :-
Persons falling under One by Six Scheme
True/False If the defective return filed under section 139(9) is not rectified within 15 days,
the return filed by the assesee shall be considered invalid and it will be treated as if
the return has not filed.
TRUE
Select The Blank
Income from other sources is the ________ head of income.
Residual
Multiple ChoiceCapital
SingleGains
Answer
are chargeable to Income Tax if there is any profit or gain arising
from the transfer of a :-
Question Capital Asset
Multiple ChoiceTheMultiple
rebate u/sAnswer
88 is available to an :-
Individual , Hindu Undivided Family.
True/False Entertainment Allowance is available for deduction only for the
TRUE 22
Single Answer
from Gross Total Income in respect of payment of Medical Insurance
Premium is available under Section :-
Question Section 80D
Match The Following
Your Answer
Question Liability to pay the tax under the head Income from Capital Gains arises
When the employee
All components
sells the shares
of Salary
allotted
to the
to extent
him under
theythe
are Employees
not exemptStock
from tax.
Option Plan
For the purpose is of
an Standard
indirect tax
deduction
levied by
thethe
term
state
Salary
Government.
includes
Tax on Employment
Relief under section 87 is available to an employee
In respect of the amount of salary received in advance or in arrears
True/False Jewellery held by the assessee is not a Capital Asset.
FALSE
Multiple ChoiceIf notified
Single Answer
news agency distributes its income amongst its members then :-
Whole of its income will be taxable
Select The Blank
Belated return can be filed at any time before the expiry of one year from the
end of the relevant ________ or before the completion of assessment, whichever is earlier.
Assessment year
Multiple ChoiceWhatSingle
is theAnswer
treatment of principal amount of loan borrowed for the purchase or
Rebate u/s 88 for such amount not exceeding Rs. 20,000
Select The Blank
Dividends from the ________ is an exempt income and hence will not be
included in the Taxable income.
Indian Companies
Multiple Choice
TheSingle
rebatesAnswer
under the Income Tax Act are available only if :-
The payment is made during year
Match The Following
Your Answer
Question Rate of depreciation is 25%
All intangible Rate
assetsoflike
depreciation
Patents, Trademarks,
is 100% Copy Rights, Licenses etc.
Temporary Structures
Rate of depreciation is 60%
Computers Rate of depreciation is 10%
Containers made of glass or plastic used as refills
True/False Insurance commission is income from business & profession.
FALSE
MultiplenewsAnswer
agencies are specified by the Central Government as
PTI , UNI
Multiple ChoiceAs per
Multiple
the provision
Answer of section 143(2) and 143(3) scrutiny assessment made
by assessing officer in order to ensure that :-
Assessee has not understated the income , Assessee has not overstated the loss ,
Assessee has under paid the taxes 23
Multiple Choice
Following
Multiplesituations
Answer are treated as change in constitution of partnership firm:-
Question Change of profit sharing ratio , Addition of new partner , Resignation of
existing partner
True/False A company is resident of India if in any previous year it is an Indian Company

even though control & management are situated outside India.
Question FALSE
Multiple Choice
TheSingle
provisions
Answer
under section 44AB of the Act, is applicable to the person
carrying on the profession and whose gross receipts in profession :-
Exceeds Rs.10 lakhs in any previous year
True/False Income earned & received outside India & remitted to India is taxable for
TRUE
Multiple Choice
Mr.Single
A had Answer
borrowed an amount of Rs. 25,000 from his friend. Out of this amt.
he invested an amount of Rs.10,000 in the PPF account opened in the name of his wife.
Which of the following is true?
Mr. A will not be entitled to any rebate u/s 88
Select The Blank
AOP id formed when two or more ________ come together to earn income.
Persons
Multiple ChoiceTheSingle
Net Annual
Answer Value of the house of Mr. X is Rs 75,000 which he has let out
for the rent of Rs 7,000, the statutory deduction under the act will be :-
Rs 22,500
Multiple ChoiceForMultiple
the purpose
Answer
of Section 40 A (2) of the IT Act, if assessee is a firm, the term
Any partner of the firm or his relative , Any person having the substantial interest i
n the business or profession of the firm or any director or partner of such company or firm or
any relative of such person. , Any person who carries on business or profession and in his
business or profession the assessee or any partner of such firm or relative of such partner has
substantial interest.
Multiple Choice
Under
Multiple
the clause
Answer
No-32 of the Act, in the Tax Audit Report, the Auditor is
Question Gross profit/turnover , Net profit/turnover , Stock in trade/turnover
True/False The due dates for the payment of advance tax are same for corporate assessees
and non-corporate assessees.
FALSE
Multiple Choice
Profits
Multiple
earned
Answer
by an Industrial Undertaking engaged in other than infrastructure
Question Operation of Ship , Hotels situated in hilly area, rural area or place of pilgrimage
Multiple Choice
WhatMultiple
is the tax
Answer
treatment of Statutory Provident Fund?
Employer's Contribution to PF is not liable for any tax payment , I 24
nterest credited to the employee's account is not liable for any tax payment. ,.
The lump sum received at the time of retirement or resignation or death is also
exempt under section 10(11) and 10(12)
True/False For being resident of India, a person must be citizen of India.
FALSE
Multiple Choice
In respect
Single of
Answer
leave travel concession If Mr. A has availed the exemption only
once or has not availed any exemption at all, in the block of four years i.e. 1998-2001 then :-
He can carry over the exemption to the next block of four years i.e. 2002-2005
provided that he avails the exemption of LTC in the first calendar year of the next
block i.e. 2002.
True/False If assessee owns more than one house properties, for his self occupation,
annual value of any one of the house property of his own choice is treated as nil & another
house as rented out.
Correct AnswerTRUE
Select The Blank
Deduction u/s ________B is available for 10 consequent assessment years
Correct Answer 10
Multiple Choice
Section
Multiple
35CCAAnswer
of the Act applies to any expenditure incurred by the assessee
by way of payment of any sum to :-
The National Fund for rural development set up by the central government ,
Any association or institution used for carrying out any programs of rural development ,
The National Urban Poverty eradication fund set up by the central government
Multiple Choice
TheSingle
sum total
Answer
of all the heads of income clubbed together gives the amount of :-
Question Gross Total Income
Multiple Choice
Rebate
Multiple
is allowed
Answer
on any subscription made to the notified deposit scheme,
interest on which is not eligible for deduction under Section 80L of the Act :-
Of a housing finance company , Of any authority satisfying the needs of
Multiple Choice
TheMultiple
amount accumulated
Answer to the credit of the employee's provident fund account
is paid at the time of :-
Retirement , Resignation
Multiple Choice
TheSingle
total amount
Answerof rebates under Section 88, Section 88B, Section 88C and
Not exceed the amount of tax calculated on the total income.
Multiple Choice
TheSingle
amount Answer
of accumulated interest on NSCs purchased in the earlier years is
assumed to be reinvested :-
VV - 3rd Taxation
Multiple Choice
WhatMultiple
is the treatment
Answer of the perquisite in the form of Gas, electricity and water
supplied to the employee?
If the facility of gas, electricity and water is supplied by the employer
to the employee purchasing the same from an outside agency, the valuation
of perquisite will be the charges paid by the employer to the outside agencyr.
supplying gas, electricity and water. , If the facility in the form of gas, electricity and
& water is supplied by the employer out of his own resources, the valuation of
perquisite will be the manufacturing cost per unit incurred by the employe
Multiple Choice
Rebate
Multiple
is allowed
Answer
on any subscription made to National Saving Scheme by :-
Multiple Choice
AnySingle
premiumAnswer
paid by the assessee by Cheque as an employer to effect or keep
in force an insurance on the health of his employees is :-
Allowed as expenses while calculating profits from business and profession
Select The Blank
If the person responsible for deducting the tax at source and paying the same
to the credit of Central Government has not been allotted the Tax Deduction Account Number (TAN),
he shall within ________ from the end of the month in which the tax was deducted,
apply for the allotment of TAN Number.
One month
Multiple Choice
TheSingle
amount Answer
of advance tax payable by non corporate assessees before
Select The Blank
The rebate u/s 88B is available to an individual who has attained the age of
65
Select The Blank
To claim sec 10A deduction unit must be established in ________.
Free Trade Zone
Select The Blank
Loss under the head Income from Capital Gains, to the extent it is long term
capital loss can be carried forward and set off in the subsequent AY against the
________ subject to the limit of 8 AY
Long term Capital Gains
Multiple Choice
TheSingle
amount Answer
of advance tax payable by non corporate assessees before 15th
Jun py
Nil
Select The Blank
Any person, who is responsible for paying any amount to a resident contractor
for carrying out any work under a contract, shall deduct the tax @________.
0.02
Multipleincomes
Answerof local authorities are exempt :-
Capital gains , Other income , House property
Multipleis Answer
the list of some of the major persons responsible for
Central or State Government , Any Local Authority , Any Trust
Multiple ChoiceExempt
Singleincome
Answeris income not considered while calculating :-
Question Total income
True/False Section 80QQB is applicable to the individual resident who is an author of
text books.
FALSE 25
Multiple ChoiceMr.Single
A whoseAnswer
Gross Total Income, before allowing deductions under Chapter
VI-A is Rs. 1,30,000, wants to make the investments in the following alternative forms - Rs.
50,000 in PPF and Rs. 50,000 in Infrastructure Bonds. The amount of rebate available
to him u/s 88 is :-
Correct AnswerRs. 20,000
Multiple ChoiceIf taxable
Single income
Answeris less than 7.5% of book profit, income tax is payable @ of :-
0.1
Select The Blank
The rebate u/s ________ is available to a woman assessee below the age of
65 years at any time during the previous years.
Correct Answer88C
True/False Software technology park means set up according to Software Technology
Park Scheme framed by Ministry of Commerce & Industries.
Correct Answer TRUE
Multiple ChoiceFromMultiple
annualAnswer
value, following deductions are allowed :-
Select The Blank
The amount of rebate/s 88C is 100% of the income tax liability before claiming
the rebate under section 88 and relief under section 89( 1) pr Rs.________ whichever is less.
5000
Select The Blank
House rent allowance is exempt from the heading ________.
Income from salaries
Multiple ChoiceDuring
Single
theAnswer
current Assessment Year, Mr. A bought 1000 Equity Shares of
A Ltd., a company manufacturing paper, which had issued 10,00,000 EqSH.
of Rs. 10 each. What is the rebate available for such investment?
Correct AnswerNo rebate will be available u/s 88.
True/False The rebate u/s 88B is allowed before the rebate u/s 88 is allowed.
Question TRUE
True/False A person who is a Senior Citizen who has attained the age of 65 years is not
FALSE
Multiple Choice
AnyMultiple
amount Answer
deposited by an Individual or a HUF in 10 year or 15 year
account under the Post Office Saving Bank (CTD) Rules, 1959. The account can be
in the name of :-
The individual himself , A minor of whom he is the guardian.
Multiple Choice
Working
Multiple
partner
Answeris a partner who :-
Attends general administration , Frames business policies ,
Takes business decisions
True/False A woman assessee below the age of 65 years is also entitled to rebate u/s 88.
TRUE
Select The Blank
The amount of rebate u/s 88B is 100% of the income tax liability before
claiming the rebate under section 88 and relief under section 89(1) or
Rs.________ whichever is less.
20000 26
Multiple Choice
TheMultiple
assesseeAnswer
is required to quote PAN in :-
Question All returns to or correspondence with the Income Tax Authorities ,
All the challans for the payment of any amount under the Act , All the documents pertaining
to purchase, sale and bank transactions
Multiple Choice
What Single
is theAnswer
due date for filing Annual return for TDS from Salaries?
True/False Income Tax Act, 1961 recognizes Written Down Value (WDV) method as
FALSE
Multiple Choice
TheSingle
lossesAnswer
incurred can be set off :-
To reduce the Gross Total Income
Multiple Choice
ShortMultiple
Term Capital
AnswerLoss can be adjusted against :-
True/False Interest on capital can be paid at the rates decided by the partners.
TRUE
Select The Blank
If the CC of the engine is less than 1.6 liters and the motor car is owned or hired
by the employer and is used partly of official and partly for personal purposes and if running
and maintenance expenses are borne by the employee then the value of perquisite will be
Correct Answer 400
Multiple Choice
Mr Single
X has received
Answer Rs 200000 as income from salary, Rs 50000 income from
house property and he also received Rs 100000 income from specified units
of the mutual fund. What will be his total income
Rs 250000
Match The Following
Your Answer
Question u/s 30
Deductions of u/s
Rent,
32 Rates, Repairs, Taxes and Insurance on Buildings are available
Deduction of Depreciation
u/s 37 is available
General deductions
u/s 31are allowed as deductions while calculating profits from business and profession
Select The Blank
It is mandatory for ________ to file a return even if there is loss or the income
is nil.
A company
Multiple Choice
TheMultiple
following Answer
relates to the head Income from Business of Profession
Unabsorbed Depreciation , Unabsorbed Business loss
Match The Following
Your Answer
Question Tenancy Rights
Intangible Capital
StockAsset
in Trade
Excluded fromEquity
ambit Shares
of termheld
Capital
for aAsset
period of Less than 36 months 27
Short Term Capital
Land held
Assetfor a period of 36 months or more
Long Term Capital Asset
True/False Loss from house property can be adjusted against the income from any other
house property.
TRUE
Multiple Choice
Deduction
Single Answer
in respect of Contribution to certain pension funds u/s 80CCC is
available to :-
Individuals
Select The Blank
After deducting interest on capital & remuneration to partners, firm is required
to pay tax @ ________
Tax 35% + 2% SC +2% EC
Select The Blank
If the employer provides the accommodation in a hotel (except where the
employee is provided such accommodation for a period of less than 15 days on his transfer
from one place to another), the perquisite will be considered to be equal to ________
% of the salary or actual charges paid to the hotel, whichever is less.
24
Multiple Choice
Which
Single
of the
Answer
following expenditure is in the nature of revenue expenditure?
Expenditure incurred as discount on issue of debentures
True/False Annual premium paid by the employer for the accident insurance policy taken
by the employer in the name of the employee is chargeable to tax.
FALSE
Multiple Choice
Mr.Single
A whoseAnswer
Gross Total Income, before allowing deductions under Chapter
VI-A is Rs. 1,45,000, wants to make the investments in the following alternative forms
- Rs. 80,000
Rs. 18,000
frastructure
expenses
nsists of :-
ial purposes.
he value of
transfer of :-
ing amounts
following :-
B is Rs.________.
lat rate of :-
red by 2005
ed that the
a false No.
otal income
t of interest?
f gift or will, .
l institution in
mum allowable
us payments
ee welfare
s incurred by
an institution,
such income
deductions
yer in a club
ai, Kolkata,
ant previous
hin 15 days,
gain arising
cal Insurance
purchase or
ted the loss ,
n Company
of this amt.
e has let out
rm, the term
tantial interest i
y or firm or
partner has
te assessees
nfrastructure
of pilgrimage
2001 then :-
2002-2005
amount of :-
fund account
ier years is
ty and water
fect or keep
unt Number (TAN),
against the
t contractor
yable @ of :-
ore claiming
ever is less.
s pertaining
ned or hired
if running
the income
is required
olicy taken
him u/s 88 is :-

Question The entertainment allowance received by the
Government employees is included in their salaries
and the deduction is allowed to the extent of least of
Correct Answer Actual amount of Entertainment Allowance received. ,
Your Answer Actual amount of Entertainment Allowance received. ,
True/False
Question Income Tax Act, 1961 recognizes Written Down Value
(WDV) method as well as straight line method for the
computation of depreciation u/s 32 this act.
Your Answer False

area or place of pilgrimage

revenue expenditure?
Correct Answer Expenditure incurred as discount on issue of
debentures
Your Answer Expenditure incurred as discount on issue of
debentures
Select The Blank

Question If sum received is net of TDS then it is ________ to
include in income from other sources.
True/False
Question Interest paid on the loan for acquiring a capital asset
will be considered to be a part of cost of acquisition.
Correct Answer True
Your Answer True

Question Mr. A whose Gross Total Income, before allowing
deductions under Chapter VI-A is Rs. 1,45,000, wants
to make the investments in the following alternative
forms Rs. 80,000 in PPF and Rs. 20,000 in
Infrastructure Bonds. The amount of rebate available
to him u/s 88 is :-

True/False
Question As per section 2(11) of the Income Tax Act, Block of
Assets includes both tangible as well as intangible
assets.
Correct Answer True
Your Answer True

Question Deductions in respect of Certain Incomes received
under Section 80L is available in respect of
Correct Answer Interest on Central or State Government Securities ,
Bank Interest
Your Answer Interest on Central or State Government Securities ,
Bank Interest

Question For the purpose of income tax, the perquisites can be
classified into :-
Correct Answer Perquisites which are taxable in case of all types of
Your Answer Perquisites which are taxable in case of all types of
Select The Blank

Correct Answer 182
Your Answer 182

:-

exempt from tax :-
Select The Blank

Question ________ of the Tax Audit Report refers to the details
of various payments which are allowed as deduction
only if they are actually paid for.

Select The Blank

Question To claim sec 10A deduction unit must be established
in ________.

from :-


Question If an employee does not avail of this leave travel
concession or assistance during a block of four
calendar years :-
Correct Answer Only one journey can be carried forward to the next
block.
Your Answer Only one journey can be carried forward to the next
block.
Select The Blank


Select The Blank

Question Where an assessee files or submits the returns as per
provisions of section 139 or in response to the notice
under section 142, the assessment officer undertakes

objectives are :-
True/False
Question While computing the profits from Business and
profession, the business or profession must be carried
out during the previous year.
Correct Answer True
Your Answer True

Question In respect of leave travel concession If Mr. A has
availed the exemption only once or has not availed
any exemption at all, in the block of four years i.e.
1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of
block i.e. 2002.
Your Answer He can carry over the exemption to the next block of
block i.e. 2002.

of :-

Municipal taxes

Question As a general principle, the Basic Salary or Wages,
Dearness Allowance and Bonus / Commission is :-

Correct Answer 80 G Donations , 80 HHB profits and gains from
projects outside India , 80 IA profits and gains of
Your Answer 80 G Donations , 80 IA profits and gains of

Question Annual value of any one palace in possession of a
former ruler is :-
Your Answer Taxable
Select The Blank

Your Answer 20000

Question The amount of accumulated interest on NSCs
purchased in the earlier years is assumed to be
reinvested :-
Select The Blank

Question Deduction u/s ________B is available for 10
consequent assessment years from the year of
commencement of production.
Correct Answer 10
Your Answer 10
True/False
house property.
Your Answer False
Select The Blank

Question Section 80U allows the deduction in respect of the
________ .
Match The Following


Expenditure connection with connection with
recovery of a debt recovery of a debt
which is not a trading which is not a trading
debt debt
Business Includes trade, Includes trade,
commerce, or commerce, or
manufacture or any manufacture or any
adventure or concern adventure or concern in
in the nature of trade, the nature of trade,
commerce or commerce or
manufacture manufacture
Capital Expenditure Expenditure incurred Premium on

by a company with the redemption of
issue of rights shares Debentures
True/False
Question Any recreational facility provided by the employer to a
group of employees (not being restricted to a select
few employees) is not exempt from tax.
Your Answer False
True/False
Question In case of deductions for medical treatment under
Section 80DDB the amount of deduction will be
reduced by the amount received under an insurance
policy or the amount reimbursed by the employer.
Correct Answer True
Your Answer True
True/False
Correct Answer True
Your Answer True

True/False
Question Entertainment Allowance received by the employees
from the private sector is taxable in the hands of the
employee.
Correct Answer True
Your Answer True
Match The Following

Any subscription made By an individual or a By an individual or a

to National Saving HUF is eligible for HUF is eligible for
Scheme rebate u/s 88 rebate u/s 88
Mr. A, a 70 years old RS.12,500 RS.12,500
Senior Citizen, has the
Rs. 2,50,000 during
the Assessment Year
2005-2006. He
invested Rs. 50,000 in
the tax saving bonds of
ICICI on 10th June
2004. His tax liability
for the A Y 2005-2006.
During the Rs. 1,000 Rs. 1,000
Assessment Year
2005-2006, Mrs. A,
age 58 years, has the
Rs. 1,45,000 including
the dividend from
Indian companies
amounting to Rs.
10,000. She invests
Rs. 50,000 in PPF
during the said
Assessment Year. her
tax liabilit is
Any contribution made Is eligible for rebate Is eligible for rebate u/s
to a Public Provident u/s 88 88
Fund


term capital asset
term capital asset
True/False
Question Income from partnership firms is exempt from taxation
for the partners
Correct Answer True
Your Answer False
Registration 200425352
Number:
Name: Sarada J.H
Subject: Taxation
Assignment Status
12/02/2006
As On:

Result Pass
Select The Blank

Question The amount of compensation received or receivable
by the employee from the employer at the time of
termination of his employment or at the time of
modification of terms and conditions in connection
with the employment is called as ________.

Correct Answer Employer's Contribution to PF is not liable for any tax
payment , Interest credited to the employee's account
is not liable for any tax payment. , The lump sum
received at the time of retirement or resignation or
death is also exempt under section 10(11) and 10(12).
Your Answer Employer's Contribution to PF is not liable for any tax
payment , Interest credited to the employee's account
is not liable for any tax payment. , The lump sum
received at the time of retirement or resignation or
death is also exempt under section 10(11) and 10(12).

Question Income from winning from lotteries / crossword
puzzles/ horse races is taxed at flat rate of :-
Correct Answer 0.3
Your Answer 0.3

Question Following specific incomes are taxable under the
heading income from other sources :-
Correct Answer Winning from betting , Interest on securities of local
authority , Bonus from key man insurance policy
Your Answer Winning from betting , Interest on securities of local
authority , Bonus from key man insurance policy
Select The Blank

Question Deduction is available for income from foreign sources
under Section 80RR if such remuneration brought into
India in convertible foreign exchange within a period
of________ months from the end of the previous year.
Correct Answer 6
Your Answer 6
Select The Blank

Question Any payment which is chargeable under the head
"________" payable outside India or to a non-resident
and if the tax has not been thereon or deducted there
from.
Select The Blank

Question The person who does not deduct the tax source as
required by the Act or after deducting fails to pay the
tax as required by the Act, shall be liable to pay the
simple interest @________ % per month on the
amount of such tax from the date on which the tax
was deductible till the date on which such tax is
actually paid.
Correct Answer 1
Your Answer 1
Select The Blank

Question Deduction u/s 10A is ________ of export proportion of
profits.
Correct Answer 0.9
Your Answer 0.9

Question Maximum Deduction u/s 80D in respect of medical
insurance premium for a person who is a Senior
Citizen is Rupees :-
Your Answer 15000
True/False
Question Any sum payable by the assessee by way of tax, duty,
cess or fee is allowed as deduction even though they
are not actually paid.
Your Answer False
Select The Blank

Question As per the Clause N0-30 of the Act ________ requires
company engaged in production, mining, and
manufacturing activities should maintain proper books
of accounts showing the particulars of utilization of
material, labour or any other item.

Question As per the provision of section 143(2) and 143(3)
scrutiny assessment made by assessing officer in
order to ensure that :-
Correct Answer Assessee has not understated the income , Assessee
has not overstated the loss , Assessee has under paid
the taxes
Your Answer Assessee has not understated the income , Assessee
has not overstated the loss , Assessee has under paid
the taxes

Question If any person fails to get the accounts audited by a
Chartered Accountant and fails to submit the copy of
such report under section 44AB, he will be liable to
pay the penalty equal to :-
Correct Answer 0.5% of sales turnover/gross receipts or Rs.1lakh
whichever is less
Your Answer 0.5% of sales turnover/gross receipts or Rs.1lakh
whichever is less

Question A return is considered to be defective returns under
section 139(9) unless :-
Correct Answer The computation of income under each head, Gross
Total Income are properly filed in , The return is
accompanied by the tax audit report under section
44AB , The return is accompanied by copies of
required financial statements of the assessee
Your Answer The computation of income under each head, Gross

Select The Blank

Question Mr. Ram is employed by the Central Government as
accountant whose gross salary income is Rs
6,00,000. He can claim standard deduction of Rs
________ u/s 16(i) of the IT Act.

Question Company means any body corporate incorporated
under the laws of :-
Correct Answer Companies Act &/or laws of any foreign country
Your Answer Laws of any foreign country
True/False
Question If the woman assessee has attained the age of 65
years, she is entitled to the rebate u/s 88B and not u/s
88C.
Correct Answer True
Your Answer True

Question Salary paid by any partnership firm to its working
partners is taxable as :-

Question According to the provisions of Section 10(13) of the
Act, following payments received from an Approved
Superannuation Fund are exempt from tax :-
Correct Answer The amount paid to the employee in lieu of or in
commutation of an annuity on his retirement on or
after a specified age or on his becoming incapacitated
prior to such retirement , The amount paid by way of
refund of contribution to the legal heirs on the death of
the beneficiary.
Your Answer The amount paid to the employee in lieu of or in
commutation of an annuity on his retirement on or
after a specified age or on his becoming incapacitated
prior to such retirement , The amount paid by way of
refund of contribution to the legal heirs on the death of
the beneficiary.

Select The Blank

Question If the person responsible for deducting the tax at
source and paying the same to the credit of Central
Government has not been allotted the Tax Deduction
Account Number (TAN), he shall within ________
from the end of the month in which the tax was
deducted, apply for the allotment of TAN Number.

Question What is the due date for filing Annual return for TDS
from payment of interest?
Select The Blank

Question ________ expenditure should not be allowed as
expenditure u/s 37 (1) of the Income Tax Act.
Your Answer Capital


Question Rebate is allowed on any subscription made to
National Saving Scheme by :-

Question The provisions for payment of gratuity is not allowed
under section 40A(7) but, under the head, profits from
business and profession, the amount of gratuity will be
allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable
to the employees during the previous year , The
provision has been made for the payment of a sum by
way of contribution to an approval gratuity , The other
than the above two situations, any provision made for
the payment of gratuity is not allowed as deduction
Your Answer The amount of gratuity has actually become payable
to the employees during the previous year , The
provision has been made for the payment of a sum by
way of contribution to an approval gratuity , The other
than the above two situations, any provision made for
the payment of gratuity is not allowed as deduction

Question The exemption for Leave travel Concession u/s
10(5)is available in respect of how many children Born
after 1st October 1998?
Your Answer Only 2

Question The Net Annual Value of the house of Mr. X is Rs
75,000 which he has let out for the rent of Rs 7,000,
the statutory deduction under the act will be :-
True/False
Question Insurance commission is income from business &
profession.
Your Answer True


Question Any person carrying on business or profession has to
submit the Audit Report in prescribed form, signed by
Chartered Accountant before 31st October of the
assessment year, whether the return of income is filed
or not. This is in compliance with :-
Match The Following

In case of Interest free The same shall be The same shall be

Loans or Loans at reduced from the reduced from the
concessional rate of valuation of valuation of perquisites.
interest if the perquisites.
employee pays any
amount of interest to
the employer
Motor Car Perquisites which is Perquisites which is
taxable only in the taxable only in the
hands of specified hands of specified
employee employee
Services of sweeper, Perquisites which is Perquisites which is
gardener, watchman or taxable only in the taxable only in the
personal hands of specified hands of specified
employee employee
The employee who Specified Employee Specified Employee
has substantial interest
in the company by
having 20% or more of
the voting power
True/False
Question For claiming the deduction under section 80IA, the
industrial undertaking should be owned by a company
registered in India or a consortium of such companies.
Correct Answer True
Your Answer True

Question The provisions under section 44AB of the Act, is
applicable to the person carrying on the profession
and whose gross receipts in profession :-
Select The Blank

Question Prior period interest is calculated from the date of
________ to the date of completion.
True/False
Question The amount of telephone bills (including the mobile
phone bills) of the employee reimbursed by the
employer is taxable in the hands of the employee.
Your Answer False
True/False
Question The payments for claiming the tax rebate u/s 88 of the
IT Act should be made out of the income chargeable
to tax.
Correct Answer True
Your Answer True

from :-
True/False
Question Section 80QQB is applicable to the individual resident
who is an author of text books.
Your Answer False
True/False
Question Dividend received from domestic company to its
shareholders is taxable in the hands of the
shareholder.
Your Answer False
True/False
Question Any Employer's Contribution payable by the assessee
towards any provident fund or superannuation fund or
gratuity fund or any other fund for the welfare of the
employees, if they are actually paid, allowed as
deduction.
Correct Answer True
Your Answer True

Question Any amount deposited by an Individual or a HUF in 10
year or 15 year account under the Post Office Saving
Bank (CTD) Rules, 1959. The account can be in the
name of :-
Correct Answer The individual himself , A minor of whom he is the
guardian.
Your Answer The individual himself , A minor of whom he is the
guardian.
Select The Blank

Question Loss under the head Income from Capital Gains, to
the extent it is long term capital loss can be carried
forward and set off in the subsequent Assessment
Years against the ________ subject to the limit of 8
Assessment years.
Match The Following

Deductions of Rent, u/s 30 u/s 30

Rates, Repairs, Taxes
and Insurance on
Buildings are available
Deduction of u/s 32 u/s 32
Depreciation is
available
General deductions u/s 37 u/s 37
are allowed as
deductions while
calculating profits from
business and
profession
Deductions of Repairs u/s 31 u/s 31
& maintenance of
machinery, plant &
furniture are available

:-

Question Assessee gets deduction of interest paid on borrowed
capital even if he :-
True/False
Question Under section 43B of the IT Act certain payments are not
allowed as deduction in any of the previous years but are paid
during the current previous year, they will be allowed as
Correct Answer True
Your Answer True

Your Answer Repairs & maintenance , Insurance premium , Interest on

borrowed capital
Select The Blank

Question Dividends from the ________ is an exempt income and hence
will not be included in the Taxable income.
Your Answer Proprietorship

Question The least of the following is the exemption available to an
employee if he is in receipt of house rent allowance :-
Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary
when the accommodation is situated at any other place. , Actual
Your Answer 50% of the Salary where such accommodation is situated in
Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary
when the accommodation is situated at any other place. , Actual
True/False
Question The value of benefit resulting from the payment made by the
employer in a club for any expenditure incurred by the employee
shall be taken as perquisites unless the said expenses are
Correct Answer True
Your Answer True

True/False
intimates a false number then he may be liable to pay a penalty
of Rs. 25000.
Your Answer True
Select The Blank

Question Section 35D of the Act provides that the preliminary expenses
can be ________ over a period of 5 years commencing from the
year of commencement of business.
Select The Blank

Question Under section 43B, Clause N0-21 provides that the details of
various payments are allowed as deductions only if they are
actually paid but, where if the assessee follows the ________,
the payments can be claimed on due basis.

Question What is the tax treatment of Commuted Pension In case of a
Government Employee?
Correct Answer The amount of commuted pension is exempt from tax as per the
provisions of Section 10(10A).
Your Answer The amount of commuted pension is exempt from tax as per the

Question For filing the returns of income, Form No. 2C is to be filled in by
:-

Your Answer Resident , Non resident

Select The Blank

Your Answer 50000
Select The Blank

Question Any expenditure incurred by the assessee for any purpose which
is ________ or which is prohibited by law shall not be allowed as
Select The Blank

Question The amount of rebate u/s 88B is 100% of the income tax liability
before claiming the rebate under section 88 and relief under
section 89(1) or Rs.________ whichever is less.
Your Answer 20000
True/False
Question Income earned & received outside India & remitted to India is
Correct Answer True
Your Answer True
Select The Blank

Question Section 35E of the Act applies to all the ________ engaged in
the business of prospecting for or extraction or production of
certain specified minerals.
Your Answer Resident assessees
Select The Blank


for :-
industrial research
Your Answer Operation of Ship , Telecommunication Services
Select The Blank

Question Section 43B of the IT Act provides that the certain payments are
allowed as deduction only if they are ________.
Your Answer Payable

Question The following are the main types of income falling under the
category of section 41 of the Act, dealing with the deemed profits
chargeable to tax and not credited to profit and loss account :-
Correct Answer Any amount received during the previous year in respect of loss
or expenditure where deduction has been allowed in the
assessment year of any earlier , Any amount recovered against
a debt, where a deduction is allowed in respect of a bad debt in
any of the earlier assessment year, the same shall be deemed to
be the profit in the year in which it is so recovered , If any asset
used for scientific research is sold and the sale proceeds along
with benefits received by the assessee under section 35,
exceeds the amount of capital expenditure, the excess will be
charged to income tax in the assessment year
Your Answer Any amount contributed towards promotion of social and
economic welfare association in the previous year shall be
charge to income tax in the assessment year.
Select The Blank

Question The rebate u/s ________ is available to a woman assessee
below the age of 65 years at any time during the previous years.
Correct Answer 88C
Your Answer 88D
True/False
Question The entire amount of investment of Rs. 1,00,000 can be made in
Infrastructure Bonds issued by IDBI stated in section 88.
Correct Answer True
Your Answer True
Select The Blank

Question For claiming deductions u/s 37 of the IT Act, the expenditure
should have been incurred during the ________ .
Correct Answer Previous year
Your Answer Financial year
Select The Blank

Question The amount paid by the employer to the employee to meet the
expenditure for residential accommodation occupied by the
employee is called ________.
Your Answer Hotel allowance
Select The Blank

Question Expenditure incurred by an assessee on advertisement in any
brochure, tract, pamphlet or like published by a ________shall
not be allowed as business expenditure.
Your Answer Company

True/False
Correct Answer True
Your Answer True


taxes
Your Answer Standard deduction , Interest on borrowed capital , Municipal
taxes


Agent of NRI
Match The Following

Disallowable Expenditure Litigation Expenses in Includes vocation

connection with recovery
of a debt which is not a
trading debt
Business Includes trade, commerce, Includes a transaction with
or manufacture or any oneself
adventure or concern in
the nature of trade,
commerce or manufacture
Profession Includes vocation Expenditure incurred by a
company with the issue of
rights shares
Capital Expenditure Expenditure incurred by a Litigation Expenses in
company with the issue of connection with recovery of
rights shares a debt which is not a
trading debt

Question Income of a professional association is exempt if its objectives
are :-


True/False
Question Any sum payable by the assessee as interest on any loan
borrowed by him from any state financial corporation as per the
terms on the agreement is not allowed as deduction from profit
as per P & L account, if they are actually paid before the due
date of furnishing return of income.
Your Answer True
True/False
Question If the debentures are converted into shares, it is considered to
be transfer of the capital asset.
Your Answer True
True/False
Question If assessee owns more than one house properties, annual value
of any one of the house property can be treated as nil, and such
option can be changed year on year basis.
Correct Answer True
Your Answer False

Question Deduction from Capital Gains under Section 54B is for Capital
True/False
Question The rebate u/s 88B is allowed before the rebate u/s 88 is
allowed.
Correct Answer True
Your Answer False

Question To assess income from business and profession and income
from other sources under section 145, the assessee may follow
either :-
Your Answer Accrual system or mercantile system of accounting

Your Answer If the debentures are issued by a widely held company and the
the debentures are issued by a widely held company and the
Select The Blank

Question The amount of rebate/s 88C is 100% of the income tax liability
section 89( 1) pr Rs.________ whichever is less.
Correct Answer 5000
Your Answer 20000
Select The Blank

Correct Answer 0.35
Your Answer 0.3

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is
an individual, the term "Specified Persons" may include :-
Correct Answer Any relative of such individual , Any person (individual, company,
firm etc.) having a substantial interest in the business or
profession of the individual or any director or partner of such
company or firm or any relative of such person. , Any person
who carries on a business or profession and in his business or
profession, the assessee himself or his relative has a substantial
interest.
Your Answer Any relative of such individual , Any person (individual, company,
company or firm or any relative of such person.
Match The Following

Perquisites Indicate benefits or Any allowance granted to

amenities provided by the meet the cost of travel on
employer to the employee, tour or on transfer of duty.
either free of cost or at the
concessional rate
House Rent Allowance This indicates the amount Indicate benefits or
paid by the employer to amenities provided by the
the employee to meet the employer to the employee,
expenditure for residential either free of cost or at the
accommodation occupied concessional rate
by the employee
Retrenchment Compensation received Any amount granted to an
Compensation by a worker at the time of employee to meet his
retrenchment expenditure for the
purpose of commuting
between the place of
residence and the place of
duty
Traveling Allowance Any allowance granted to Compensation received by
meet the cost of travel on a worker at the time of
tour or on transfer of duty. retrenchment

Select The Blank


True/False
Question The due dates for the payment of advance tax are same for
corporate assessees and noncorporate assessees.
Your Answer False

True/False
Your Answer False
Select The Blank

Question Assessee gets deduction of Rs 150000/- on borrowed capital if
property is acquired on or after ________.
Correct Answer 01st April, 1999
Your Answer 01st April, 1999
True/False
Question If assessee owns more than one house properties, annual value
of any one of the house property can be treated as nil, and such
option can be changed year on year basis.
Correct Answer True
Your Answer True


True/False
Question The rebate u/s 88B is allowed before the rebate u/s 88 is
allowed.
Correct Answer True
Your Answer True


Agent of NRI
Your Answer Legal heir of deceased person , Parents of minor assessee ,
Agent of NRI

Select The Blank

Question The amount of rebate/s 88C is 100% of the income tax liability
section 89( 1) pr Rs.________ whichever is less.
Correct Answer 5000
Your Answer 5000

Question According to the provisions of Section 10(13) of the Act,
following payments received from an Approved Superannuation
Fund are exempt from tax :-
Correct Answer The amount paid to the employee in lieu of or in commutation of
an annuity on his retirement on or after a specified age or on his
becoming incapacitated prior to such retirement , The amount
paid by way of refund of contribution to the legal heirs on the
Your Answer The amount paid to the employee in lieu of or in commutation of
an annuity on his retirement on or after a specified age or on his
becoming incapacitated prior to such retirement , The amount
paid by way of refund of contribution to the legal heirs on the
True/False
Question An asset, which is not a Short Term Capital Asset, is treated as
a Long Term Capital Asset.
Correct Answer True
Your Answer True

taxable as :-


Match The Following

Employee stock option ESOPS ESOPS

plan
Uncommuted Pension Indicates the periodical Indicates the periodical
payment of pension payment of pension
Commuted Pension Indicates the lump sum Indicates the lump sum
received in lieu of the received in lieu of the
periodical periodical
Treatment of Perquisite Taxed in the hands of Taxed in the hands of
employee as taxable employee as taxable salary
salary
True/False
Question If the amount of tax payable by the assessee is higher than the
combined amount of tax deducted at source and advance tax,
such tax along with the amount of interest payable should be
paid by the assessee at the time of filing the return of income
Correct Answer True
Your Answer True


Your Answer Tax 35% + SC 2% + EC 2%

Select The Blank


Question Following specific incomes are taxable under the heading
income from other sources :-
Correct Answer Winning from betting , Interest on securities of local authority ,
Your Answer Winning from betting , Interest on securities of local authority ,


Select The Blank

Question Any person, who is responsible for paying any amount to a
resident contractor for carrying out any work under a contract,
shall deduct the tax @________.
Correct Answer 0.02
Your Answer 0.02

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is a
company, the term "Specified Persons" may include :-
Correct Answer Any person who carries on a business or profession and in his
business the assessee or any director of such company or
relative of such director has substantial interest. , Any director of
the company or his relative , Any person having a substantial
interest in the business or profession of the company or any
director or partner of such firm or company or the relative of such
person.
Your Answer Any person who carries on a business or profession and in his
business the assessee or any director of such company or
relative of such director has substantial interest. , Any director of
the company or his relative , Any person having a substantial
interest in the business or profession of the company or any
director or partner of such firm or company or the relative of such
person.

Select The Blank

Question Any expenditure incurred by the assessee for any purpose which
is ________ or which is prohibited by law shall not be allowed as
Your Answer Offence
Select The Blank

payments which are allowed as deduction only if they are
actually paid for.

Question A return is considered to be defective returns under section
139(9) unless :-
Correct Answer The computation of income under each head, Gross Total
Income are properly filed in , The return is accompanied by the
tax audit report under section 44AB , The return is accompanied
Your Answer The computation of income under each head, Gross Total
Income are properly filed in , The return is accompanied by the
tax audit report under section 44AB , The return is accompanied

Question What is the tax treatment of Commuted Pension In case of a
Government Employee?
Correct Answer The amount of commuted pension is exempt from tax as per the
Your Answer The amount of commuted pension is exempt from tax as per the

under Chapter VI-A is Rs. 2,40,000 wants to make the
investments in the following alternative forms Rs. 50,000 in PPF
and Rs. 50,000 in Infrastructure Bonds. The amount of rebate
Match The Following

Deduction for Medical Section 80DD Section 80DD

Treatment of handicapped
dependent
Deduction for Contribution Section 80CCC Section 80CCC
to Certain pension funds
Deduction for Contribution Section 80CCD Section 80CCD
to pension scheme of
Central Government
Deduction for Payment of Section 80D Section 80D
Medical Insurance
Premium

Question What is the treatment of Death-Cum-Retirement Gratuity
received by the employees of Central Government or State
Government or Local Authorities?
Correct Answer It is totally exempt from tax
Your Answer It is totally exempt from tax
Select The Blank

Correct Answer 8
Your Answer 8

Question Any amount paid by an individual as tuition fees to any
educational institution in India for the purpose of full time
education of the individual's children. The maximum allowable
limit is :-
Correct Answer Rs. 12,000 per child per annum , Subject to the maximum of two
children.
Your Answer Rs. 12,000 per child per annum , Subject to the maximum of two
children.

Question For the purpose of calculating the value of perquisite of
residential accommodation the term salary does not include :-
Correct Answer Dearness Allowance , Employer's contribution to Provident Fund
, Allowances which are exempt from tax
Your Answer Allowances which are exempt from tax , Allowances which are
partly exempt from tax

Question Capital Gains arise on account of excess of transfer
consideration over the following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure incurred
Your Answer Cost of acquisition , Cost of improvement , Expenditure incurred

Select The Blank

Question Expenditure incurred in connection with the local festivals like
Diwali etc. are ________ as business expenditure.
Your Answer Allowed
Select The Blank

Question If the employer provides the accommodation in a hotel (except
where the employee is provided such accommodation for a
period of less than 15 days on his transfer from one place to
another), the perquisite will be considered to be equal to
________% of the salary or actual charges paid to the hotel,
whichever is less.
Correct Answer 24
Your Answer 24


Question If the Salary is less than Rs. 5,00,000, Standard Deduction will
be the least of the following :-
True/False
Question Under section 43B of the IT Act certain payments are not
allowed as deduction in any of the previous years but are paid
during the current previous year, they will be allowed as
Correct Answer True
Your Answer True

Correct Answer There needs to be an employer-employee relationship between

the payer and the payee.
Your Answer There needs to be an employer-employee relationship between
the payer and the payee.
Select The Blank
Question ________ expenditure should not be allowed as expenditure u/s
37(1) of the Income Tax Act.
Select The Blank

Question ________ expenditure should not be allowed as expenditure u/s
37 (1) of the Income Tax Act.
Your Answer Capital

Select The Blank

Question The amount of compensation received or receivable by the
employee from the employer at the time of termination of his
employment or at the time of modification of terms and
conditions in connection with the employment is called as
________.

Question Long Term Capital Loss can be adjusted :-
Correct Answer Only against the Long Term Capital Gains
Your Answer Only against the Long Term Capital Gains
True/False
Question In case of deductions for medical treatment under Section
80DDB the amount of deduction will be reduced by the amount
received under an insurance policy or the amount reimbursed by
the employer.
Correct Answer True
Your Answer True
True/False
Question Loss from house property can be adjusted against the income
from any other house property.
Correct Answer True
Your Answer True

Question For the purpose of Section 40 A (2) of the IT Act, if assessee is
an individual, the term "Specified Persons" may include :-
Correct Answer Any relative of such individual , Any person (individual, company,
interest.
Your Answer Any relative of such individual , Any person (individual, company,
interest.
Select The Blank

________ share capital of the company is not allowed as
revenue expenditure.

Correct Answer Motor Car , Services of sweeper, gardener, watchman or
personal attendant , Gas, electricity and water provided for
Your Answer Motor Car , Services of sweeper, gardener, watchman or
True/False
Question Cost of improvement does not include any expenditure which is
deductible from any other head of income.
Correct Answer True
Your Answer True
Match The Following

When the employee sells Liability to pay the tax Liability to pay the tax
the shares allotted to him under the head Income under the head Income
under the Employees from Capital Gains arises from Capital Gains arises
Stock Option Plan
For the purpose of All components of Salary All components of Salary
Standard deduction the to the extent they are not to the extent they are not
term Salary includes exempt from tax. exempt from tax.
Tax on Employment is an indirect tax levied by is an indirect tax levied by
the state Government. the state Government.
In respect of the amount Relief under section 89 is Relief under section 89 is
of salary received in available to an employee available to an employee
advance or in arrears
Select The Blank


Question From GTI of a company following deductions under chapter VI A
are allowed
Correct Answer 80 HHB profits and gains from projects outside India , 80 IA
profits and gains of infrastructure companies , 80 G Donations
Your Answer 80 G Donations , 80 HHB profits and gains from projects outside
Select The Blank

Question Any expenditure incurred by a company for promoting the family
planning among its employees is allowed as expenditure. If such
expenditure is of capital nature, ________ of such expenditure is
allowed in the year in which it is incurred.
Correct Answer 1/5th
Your Answer 1/3rd
True/False
Question Any sum payable by the assessee as interest on any loan
borrowed by him from any state financial corporation as per the
terms on the agreement is not allowed as deduction from profit
as per P & L account, if they are actually paid before the due
date of furnishing return of income.
Your Answer False

Question As per which provision and section, every person, company or
any other person shall furnish his returns of income in the
prescribed form on or before the specified due date?

Question Deductions in respect of Certain Incomes received under
Section 80L is available in respect of
National Saving Certificates (NSCs) Interest on National Saving
Scheme, 1992 (NSS) , Bank Interest
National Saving Certificates (NSCs) Interest on National Saving
Scheme, 1992 (NSS) , Bank Interest
Select The Blank

relevant previous year for the purpose of employment has to be
in India for ________ days or more during previous year.
Correct Answer 182
Your Answer 182

Question Deduction from Capital Gains under Section 54F is for Capital
True/False
Question Entertainment Allowance received by the employees from the
private sector is taxable in the hands of the employee.
Correct Answer True
Your Answer True

for :-
industrial research
industrial research

Question Following incomes are deemed to have accrued or arisen in
India :-
Government to Indian national for services rendered outside
India , Tax deducted in India

Question Assessee gets deduction of interest paid on borrowed capital if it
is used for :-
Select The Blank

under this Section.
True/False
Question Deductions available as per the provisions of Chapter VI of the
Act are not available for the long-term capital gains.
Correct Answer True
Your Answer False
True/False
Your Answer False
True/False
Your Answer False

Select The Blank

Question Deduction u/s ________B is available for 10 consequent
assessment years from the year of commencement of
production.
Correct Answer 10
Your Answer 10

Question The reduction in the value of fixed assets is due to :-
Correct Answer Time, use, both time as well as use and obsolescence
Your Answer Time, use, both time as well as use and obsolescence

Question What is the treatment of the perquisite in the form of Gas,
electricity and water supplied to the employee?
Correct Answer If the facility of gas, electricity and water is supplied by the
employer to the employee purchasing the same from an outside
agency, the valuation of perquisite will be the charges paid by
the employer to the outside agency supplying gas, electricity and
water. , If the facility in the form of gas, electricity and water is
supplied by the employer out of his own resources, the valuation
of perquisite will be the manufacturing cost per unit incurred by
the employer.
Your Answer If the facility of gas, electricity and water is supplied by the
employer to the employee purchasing the same from an outside
agency, the valuation of perquisite will be the charges paid by
the employer to the outside agency supplying gas, electricity and
water. , If the facility in the form of gas, electricity and water is
supplied by the employer out of his own resources, the valuation
of perquisite will be the manufacturing cost per unit incurred by
the employer.

Question The provisions under section 44AB of the Act, is applicable to
the person carrying on the profession and whose gross receipts
in profession :-

Question Section 269T does not apply to the repayment of any loan or
deposit taken or accepted from :-
Correct Answer Any government company , Any banking or cooperative bank ,
Any corporation established by the central or state Act
Your Answer Any government company , Any banking or cooperative bank ,
True/False
Question Salary for the purpose of entertainment allowance means basic
salary. It excludes all other allowances.
Correct Answer True
Your Answer False

premium for a person who is not a Senior Citizen is Rupees :-
Your Answer 15000

Question Rent for other amenities like lift, electricity, telephone etc. is
taxed under the heading :-
Your Answer Income from other sources
True/False
Question Interest paid on the loan for acquiring a capital asset will be
considered to be a part of cost of acquisition.
Correct Answer True
Your Answer True

Question The amount of advance tax payable by corporate assessees
Match The Following

Super Annuation Fund This is an employee This is an employee

welfare scheme which is welfare scheme which is
usually applicable in case usually applicable in case
of very senior employees of very senior employees
provisions of Provident provisions of Provident
Fund Act, 1925. This is Fund Act, 1925. This is
maintained by maintained by Government
Government organizations, local
organizations, local authorities, universities and
authorities, universities educational institutions.
and educational
institutions.
Recognised Provident This is the provident fund This is the provident fund
Fund to which the provisions of to which the provisions of
Employees Provident Employees Provident Fund
Fund and Miscellaneous and Miscellaneous
Provisions Act, 1952 Provisions Act, 1952 apply.
apply.
Unrecognised Provident The provident fund which The provident fund which
Fund is not recognized by the is not recognized by the
income tax authorities is income tax authorities is
called as unrecognized called as unrecognized
provident fund. provident fund.
Select The Blank

Question Mr X a salaried employee has received total educational
allowance of Rs 8,000 for his four children, the maximum
allowance exempt is ________ u/s 10(14) of the IT Act.

Question Deduction in respect of Contribution to certain pension scheme
of Central Government is related to :-
Correct Answer Section 80CCD
Your Answer Section 80CCD

Correct Answer Employer's Contribution to PF is not liable for any tax payment ,
Interest credited to the employee's account is not liable for any
tax payment. , The lump sum received at the time of retirement
or resignation or death is also exempt under section 10(11) and
10(12).
Your Answer Employer's Contribution to PF is not liable for any tax payment ,
Interest credited to the employee's account is not liable for any
tax payment. , The lump sum received at the time of retirement
or resignation or death is also exempt under section 10(11) and
10(12).
True/False
Question The entire amount of investment of Rs. 1,00,000 can be made in
Infrastructure Bonds issued by IDBI stated in section 88.
Correct Answer True
Your Answer True

under Chapter VI-A is Rs. 1,30,000, wants to make the

Select The Blank

Question Non resident individual satisfies ________ of the basic
conditions.
Correct Answer None
Your Answer None

Question Which of the following expenditures are expressly disallowed to
be deducted while computing the profits from business and
profession
Select The Blank

is higher.
True/False
Question Refund of Income tax is taxable as Income from business or
profession.
Your Answer False

Correct Answer 80 IA profits and gains of infrastructure companies ,
80 G Donations , 80 HHB profits and gains from
projects outside India
Your Answer 80 G Donations , 88 PPF , 80 IA profits and gains of

Question A return is considered to be defective returns under
section 139(9) unless :-
Correct Answer The computation of income under each head, Gross
Your Answer The computation of income under each head, Gross
accompanied by copies of required financial
statements of the assessee , The return is filed on
31st August of the assessment year
Select The Blank

Question Expenditure incurred in connection with the local
festivals like Diwali etc. are ________ as business
expenditure.
Your Answer Not allowed

Question Exempt income is income not considered while
calculating :-
Your Answer Gross taxable income

Question Which section of the Act provides that an assessee
may follow a system of accounting to calculate the
income from business and profession and income
from other sources?

term capital asset
term capital asset , Within three months from the date
of transfer of the long-term capital asset
True/False
Question The amount of expenses including membership fees
and annual fees incurred by the employee on credit
card and which are paid by the employer shall be
added as the perquisites unless the said expenses are
Correct Answer True
Your Answer True

Question To get deduction of Rs 150000/- as interest on
borrowed capital assessee needs to satisfy conditions
i.e. :-
Correct Answer Borrowal is after 1st April 1999 , Construction is
completed in 3 years
Your Answer Deduction can be for principal portion also , Borrowal
is after 1st April 1999
True/False
Correct Answer True
Your Answer False

Match The Following

Rebate Under Section Is available to a Is available to an

88C woman assessee individual who has
below the age of 65 attained the age of 60
years at any time or more at any time
during the previous during the previous
years. year.
Jeevan Dhara or Deferred Annuity Plan Any educational
Jeevan Akshay of LlC institution in India for
the purpose of full time
education of the
individual's children.
Any amount paid by an Any educational Are the Deferred
individual as tuition institution in India for Annuity Plan of ICICI
fees is eligible for the purpose of full time
rebate u/s 88 only if education of the
payment is made to individual's children.
Rebate Under Section Is available to an Deferred Annuity Plan
88B individual who has of LlC
attained the age of 65
or more at any time
during the previous
year.

Question For filing the returns of income, Form No. 2C is to be
filled in by :-
Your Answer Joint Stock Company
True/False
Question Professional Tax paid by a person carrying on the
business is allowed as business expenditure.
Correct Answer True
Your Answer True
Question Income received by following assesses is taxable in
India :-
Correct Answer Resident , Non resident , Resident but not ordinary
resident
Select The Blank

conditions.
Correct Answer None
Your Answer None
True/False
Question If the defective return filed under section 139(9) is not
rectified within 15 days, the return filed by the assesee
shall be considered invalid and it will be treated as if
the return has not filed.
Correct Answer True
Your Answer True

Question Following incomes are deemed to have accrued or
arisen in India :-
Correct Answer Salary earned in India even if paid outside India ,
Salary paid by Government to Indian national for
services rendered outside India , Tax deducted in
India
Your Answer Salary earned in India even if paid outside India ,
Salary paid by Government to Indian national for
services rendered outside India , Tax deducted in
India
Select The Blank

Your Answer Profit after tax

Question Annual return for TDS from payment of interest is to
be filed in :-

Question The Basic Rule for computing Deduction from Chapter
VI A is :-
Correct Answer The amount of deductions under the provisions of
Chapter VI-A cannot exceed the Gross Total Income.
Your Answer The amount of deductions under the provisions of
Chapter VI-A cannot exceed the Gross Total Income.
Select The Blank

Question Dividends from the ________ is an exempt income
and hence will not be included in the Taxable income.
Select The Blank

Correct Answer 182
Your Answer 60

Question An assessee can claim deduction under section 35 in
relation to the expenditure incurred on scientific
research in the field of natural gas or applied sciences
if :-
Correct Answer Any revenue expenses incurred by the assessee for
carrying out the scientific research provided that such
research is related to his business , Any capital
expenses incurred by the assesse himself for carrying
out the scientific research provided that such research
is related to his business , The assesse is a company
engaged in the business of bio-technology or any
other notified product a weighted deduction of 150% is
allowed in respect of in-house research and
development expensed, till 31st March, 2005
Your Answer Any revenue expenses incurred by the assessee for
carrying out the scientific research provided that such
research is related to his business , Any capital
expenses incurred by the assesse himself for carrying
out the scientific research provided that such research
is related to his business
Select The Blank

Question Section 43B of the IT Act provides that the certain
payments are allowed as deduction only if they are
________.
Match The Following

Rebate Under Section Is allowed to Senior Is allowed to Senior

88B Citizens Citizens
Rebate u/s 88 Is allowed to individual Is allowed only to
or HUF womean assessee
below 65 years of age
Rebate u/s 88C Is allowed only to Is allowed to Company
womean assessee
below 65 years of age
Rebate Under Section Is allowed only to Is allowed only to
88D Individual assesses Individual assesses


Question The specified assets for the purpose of claiming
exemption from Capital Gains u/s 54EC mean the
bonds redeemable after 3 years issued by the
following institutions
Correct Answer National Bank for Agriculture and Rural Development
(NABARD) , Rural Electrification Corporation Limited ,
Small Industries Development Bank of India
Your Answer National Bank for Agriculture and Rural Development
(NABARD) , Rural Electrification Corporation Limited
True/False
Question If assessee owns more than one house properties,
annual value of any one of the house property can be
treated as nil, and such option can be changed year
on year basis.
Correct Answer True
Your Answer False

of :-
Select The Blank

Question Section 35D of the Act provides that the preliminary
expenses can be ________ over a period of 5 years
commencing from the year of commencement of
business.


Question The Central Government has introduced a new
pension scheme for the employees employed on or
after 15th January, 2004. These employees are
required to contribute 10% of their salaries to this
pension scheme and the Central Government will
make an equal contribution. How will the contribution
of Central Government be taxed?
Select The Blank

Question The amount paid by the employer to the employee to
meet the expenditure for residential accommodation
occupied by the employee is called ________.

Question Which of the following amounts credited to P & L
Account but not taxable from Income tax Purposes as
Profits from Business and Profession?
Correct Answer Refund of Income tax , Capital Gains , Dividend
Income
Your Answer Refund of Income tax , Dividend Income , Bad Debts
recovered allowed as deduction in earlier years

Question Which of the following expenditures are expressly
disallowed to be deducted while computing the profits
from business and profession
True/False
house property.
Your Answer True
Select The Blank

Question No tax is required to be deducted if the amount paid or
credited in pursuance of any contract does not exceed
a certain amount. However, if the aggregate of such
amounts paid or credited to a payee exceeds
________ the tax is required to be deducted under
this Section.

Question The assessing officer may allot the Permanent
Account Number(PAN) to :-
Correct Answer Person whose Total Income during previous year
exceeds the maximum amount, chargeable to tax ,
Person carrying on the business or profession whose
turnover exceeds Rs.5 lakhs in any previous year ,
Any other person by whom tax is payable
Your Answer Person whose Total Income during previous year
exceeds the maximum amount, chargeable to tax ,
Person carrying on the business or profession whose
turnover exceeds Rs.5 lakhs in any previous year ,
Any other person by whom tax is payable
True/False
Question Amount spent for training the employees and amount
spent by the employer as fees for sending the
employee for the refresher courses (including the
lodging and boarding expenses incurred by the
employee) is exempt from tax.
Correct Answer True
Your Answer True
Select The Blank

Question It is mandatory for ________ to file a return even if
there is loss or the income is nil.

Question For the purpose of Section 40 A (2) of the IT Act, if
assessee is an individual, the term "Specified
Correct Answer Any relative of such individual , Any person (individual,
company, firm etc.) having a substantial interest in the
business or profession of the individual or any director
or partner of such company or firm or any relative of
such person. , Any person who carries on a business
or profession and in his business or profession, the
assessee himself or his relative has a substantial
interest.
Your Answer Any person (individual, company, firm etc.) having a
substantial interest in the business or profession of the
individual or any director or partner of such company
or firm or any relative of such person. , Any person
who carries on a business or profession and in his
business or profession, the assessee himself or his
relative has a substantial interest. , Any person who is
not substantially interested nor any relatives of the
individual

Question Deduction from Gross Total Income in respect of
payment for Medical treatment of Handicapped is
available under Section :-
Correct Answer Section 80DD
Select The Blank

Question It should be noted that the tax liability of an individual
having the total income of less than Rs ________ is
Nil u/s 88D.
Your Answer 50000
True/False
Question For being resident of India, a person must be citizen of
India.
Your Answer True

capital expenditure?
Correct Answer Expenditure in connection with the issue of bonus
shares
Your Answer Expenditure in connection with the issue of bonus
shares

Correct Answer Agent of NRI , Legal heir of deceased person ,
Parents of minor assessee
Your Answer Agent of NRI , Legal heir of deceased person ,
Parents of minor assessee
True/False
Question Refund of Income tax is taxable as Income from
business or profession.
Your Answer False

Question Rebate is allowed on any subscription made to
National Saving Scheme by :-

Question The exemption for Leave travel Concession u/s
10(5)is available in respect of :-
Correct Answer Two journeys performed in the block of four years.
Your Answer Two journeys performed in the block of four years.

exempt from tax :-
Select The Blank

Question The maximum amount of deduction permissible u/s
80CCC is Rs. :-
Your Answer 10000

Your Answer To reduce the tax liability
True/False
Question Cost of improvement does not include any
expenditure which is deductible from any other head
of income.
Correct Answer True
Your Answer True
True/False
Question If the capital asset becomes the property of the
assessee by virtue of gift or will, the period for which
the capital asset is held by the previous owner should
be excluded while deciding the holding period.
Your Answer False

Question Rebate is allowed on any subscription made to the
notified deposit scheme, interest on which is not
eligible for deduction under Section 80L of the Act :-
Correct Answer Of a housing finance company , Of any authority
satisfying the needs of housing accommodations or
planning & development of cities, towns etc.
Your Answer Of a housing finance company , Of any authority
satisfying the needs of housing accommodations or
planning & development of cities, towns etc.
Select The Blank

Question If a person, other than an individual or a HUF, is
responsible to pay the rent to any person in excess of
________ during the financial year.

from :-


Municipal taxes
Your Answer Standard deduction , Interest on borrowed capital ,
Municipal taxes
Select The Blank

Question Expenditure incurred by way of fees etc. in connection
with any proceedings under Income Tax Act are
________ as business expenditure
Your Answer Allowed

Select The Blank

Question Section 35AC of the Act applies to any sum paid by
the assessee to a public sector company or a local
authority or an association approved by the national
committee for ________ for carrying out any project in
upliftment of public.
True/False
Question For claiming the deduction under section 80IA, the
industrial undertaking should be owned by a company
registered in India or a consortium of such companies.
Correct Answer True
Your Answer True
Select The Blank

Your Answer 20000
True/False
Question If an assessee gets the salary from more than one
employer during an Assessment Year, Salary received
from all the employers will be aggregated and then the
Standard Deduction will be allowed.
Correct Answer True
Your Answer True

Match The Following

Superannuation Fund It is an employee It is an employee

welfare scheme welfare scheme
Statutory Provident This is set up as per This is set up as per the
Fund the provisions of provisions of Provident
Provident Fund Act, Fund Act, 1925.
1925.
Recognized Provident the provisions of the provisions of
Fund Employees Provident Employees Provident
Fund and Fund and
Miscellaneous Miscellaneous
Provisions Act, 1952 Provisions Act, 1952
apply to this fund. apply to this fund.
Unrecognized The provident fund The provident fund
Provident Fund which is not which is not recognized
recognized by the by the income tax
income tax authorities . authorities .

:-

Question What is the treatment of the perquisite in the form of
Gas, electricity and water supplied to the employee?
Correct Answer If the facility of gas, electricity and water is supplied by
the employer to the employee purchasing the same
from an outside agency, the valuation of perquisite will
be the charges paid by the employer to the outside
agency supplying gas, electricity and water. , If the
facility in the form of gas, electricity and water is
supplied by the employer out of his own resources,
the valuation of perquisite will be the manufacturing
cost per unit incurred by the employer.
Your Answer If the facility of gas, electricity and water is supplied by
the employer to the employee purchasing the same
from an outside agency, the valuation of perquisite will
be the charges paid by the employer to the outside
agency supplying gas, electricity and water. , If the
facility in the form of gas, electricity and water is
supplied by the employer out of his own resources,
the valuation of perquisite will be the manufacturing
cost per unit incurred by the employer.
True/False
Question A person who is a Senior Citizen who has attained the
age of 65 years is not entitled to the rebate u/s 88 of
the Act.
Your Answer True
True/False
Question Rebates as per the provisions of Section 88 of the Act
are not available from the tax on long-term capital
gains.
Correct Answer True
Your Answer True
Select The Blank


Question The amount of advance tax payable by corporate
assessees before 15th December of Previous year is
:-

Question The due date prescribed for filing the returns of
income in Form No. 2C is

Question The Net Annual Value of the house of Mr. X is Rs
75,000 which he has let out for the rent of Rs 7,000,
the statutory deduction under the act will be :-
Match The Following
When the employee Liability to pay the tax Liability to pay the tax
sells the shares under the head Income under the head Income
allotted to him under from Capital Gains from Capital Gains
the Employees Stock arises arises
Option Plan
For the purpose of All components of All components of
Standard deduction Salary to the extent Salary to the extent
the term Salary they are not exempt they are not exempt
includes from tax. from tax.
Tax on Employment is an indirect tax levied is an indirect tax levied
by the state by the state
Government. Government.
In respect of the Relief under section 89 Relief under section 89
amount of salary is available to an is available to an
received in advance or employee employee
in arrears

Correct Answer There needs to be an employer-employee relationship
between the payer and the payee.
Your Answer There needs to be an employer-employee relationship
between the payer and the payee.
True/False
Question Interest is payable by the assessee for not paying the
Advance tax or if the Advance tax paid by the
assessee is less than 80% of the Assessed tax after
adjusting the amount of TDS and Advance tax Paid
Your Answer False

Question Perquisites which are taxable only in the hands of
specified employee include the following categories of
perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman
or personal attendant , Gas, electricity and water
provided for personal consumption
Your Answer Motor Car , Services of sweeper, gardener, watchman
or personal attendant , Gas, electricity and water
provided for personal consumption
True/False
Correct Answer True
Your Answer True
Select The Blank

Question For the employee who is blind or orthopaedically
handicapped with disability of lower extremities, the
transport allowance exempt is Rs. ________ per
month.
Correct Answer 1600
Your Answer 1600
Select The Blank

Question If the asset sold or transferred by the employer to
employee is in the form of computers an electronic
items, the wear and tear will be calculated @
________ %.
Correct Answer 50
Your Answer 50

Question Any amount deposited by an Individual or a HUF in 10
year or 15 year account under the Post Office Saving
Bank (CTD) Rules, 1959. The account can be in the
name of :-
Correct Answer The individual himself , A minor of whom he is the
guardian.
Your Answer A minor of whom he is the guardian.

Question Salary paid by any partnership firm to its working
partners is taxable as :-

Question Capital Gains arise on account of excess of transfer
consideration over the following amounts
Correct Answer Cost of acquisition , Cost of improvement ,
Expenditure incurred wholly and exclusively in
Your Answer Cost of acquisition , Cost of improvement ,
Expenditure incurred wholly and exclusively in
Select The Blank

Question The person who does not deduct the tax source as
required by the Act or after deducting fails to pay the
tax as required by the Act, shall be liable to pay the
simple interest @________ % per month on the
amount of such tax from the date on which the tax
was deductible till the date on which such tax is
actually paid.
Correct Answer 1
Your Answer 1
Select The Blank

Your Answer Indian

objectives are :-

Question Under the clause No-32 of the Act, in the Tax Audit
Report, the Auditor is required to give the accounting
calculation in ratios of :-
trade/turnover
trade/turnover

Question The amount of advance tax payable by non corporate
assessees before 15th June of Previous year is :-
Correct Answer Nil
Your Answer Nil
True/False
intimates a false number then he may be liable to pay a penalty
of Rs. 25000.
Your Answer True
True/False
Question For claiming the deduction under section 80IA, the industrial
undertaking should be owned by a company registered in India
or a consortium of such companies.
Correct Answer True
Your Answer True

Question Following is the list of some of the major persons responsible for
Select The Blank

Correct Answer 8
Your Answer 8
Select The Blank

Correct Answer 0.35
Your Answer 0.4
True/False
Question The amount of expenses including membership fees and annual
fees incurred by the employee on credit card and which are paid
by the employer shall be added as the perquisites unless the
said expenses are incurred wholly and exclusively for official
purposes.
Correct Answer True
Your Answer True


Question If any person fails to get the accounts audited by a Chartered
Accountant and fails to submit the copy of such report under
section 44AB, he will be liable to pay the penalty equal to :-
Correct Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is
less
Your Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is
less

Question For the purpose of taxability of perquisite a specified employee
means :-
Correct Answer The person who is director of a company , The employee who
has substantial interest in the company by having 20% or more
of the voting power , The employee whose income under the
head salaries (including all the taxable monetary payments of
salary but excluding the value of any non-monetary benefits or
perquisites), after allowing deductions under Section 16,
exceeds Rs. 50,000
Your Answer The person who is director of a company , The employee who
has substantial interest in the company by having 20% or more
of the voting power , The employee whose income under the
head salaries (including all the taxable monetary payments of
salary but excluding the value of any non-monetary benefits or
perquisites), after allowing deductions under Section 16,
exceeds Rs. 50,000

Correct Answer Frames business policies , Takes business decisions , Attends

general administration
Your Answer Frames business policies , Takes business decisions , Attends
general administration

Question Following situations are treated as change in constitution of
partnership firm:-
Correct Answer Change of profit sharing ratio , Addition of new partner ,
Resignation of existing partner
Your Answer Change of profit sharing ratio , Addition of new partner ,
Introduction of additional capital
under Chapter VI-A is Rs. 1,45,000, wants to make the
Select The Blank

Question It is mandatory for ________ to file a return even if there is loss
or the income is nil.
True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets
includes both tangible as well as intangible assets.
Correct Answer True
Your Answer True
True/False
Question Interest on housing loan is deductible from the year of
acquisition / construction.
Correct Answer True
Your Answer True

expenditure?
True/False
Question Deduction u/s Section 80DD for Medical treatment of
handicapped dependent is not available to HUF
Your Answer False

Correct Answer Services of sweeper, gardener, watchman or personal attendant
, Gas, electricity and water provided for personal consumption ,
Motor Car
Your Answer Motor Car , Services of sweeper, gardener, watchman or
True/False
Question Refund of Income tax is taxable as Income from business or
profession.
Your Answer True
Select The Blank

the form of motor car, the wear and tear will be calculated @
________ %.
Correct Answer 20
Your Answer 50

Question Following professional institutions have their incomes exempt
from tax :-
Select The Blank

________ share capital of the company is not allowed as
revenue expenditure.
Your Answer Issued
Select The Blank

Correct Answer 0.1
Your Answer 0.2

Question The Net Annual Value of the house of Mr. X is Rs 75,000 which
he has let out for the rent of Rs 7,000, the statutory deduction
under the act will be :-
Select The Blank

Question If the employer provides the accommodation in a hotel (except
where the employee is provided such accommodation for a
period of less than 15 days on his transfer from one place to
another), the perquisite will be considered to be equal to
________% of the salary or actual charges paid to the hotel,
whichever is less.
Correct Answer 24
Your Answer 24
True/False
Question Amount spent for training the employees and amount spent by
the employer as fees for sending the employee for the refresher
courses (including the lodging and boarding expenses incurred
by the employee) is exempt from tax.
Correct Answer True
Your Answer True

Question Section 269T does not apply to the repayment of any loan or
deposit taken or accepted from :-
Correct Answer Any government company , Any banking or cooperative bank ,
Your Answer Any government company , Any banking or cooperative bank ,

Question While calculating the tax liability of an assessee, certain
deductions are permissible as per the provisions of Chapter VI-A
of the Act. These amounts are deducted from :-
Match The Following

Deductions of Rent, u/s 30 u/s 30

Rates, Repairs, Taxes
and Insurance on
Buildings are available
Deduction of Depreciation u/s 32 u/s 32
is available
General deductions are u/s 37 u/s 37
allowed as deductions
while calculating profits
from business and
profession
Deductions of Repairs & u/s 31 u/s 31
maintenance of
machinery, plant &
furniture are available
Select The Blank

Question The amount of rebate u/s 88B is 100% of the income tax liability
section 89(1) or Rs.________ whichever is less.
Your Answer 20000
True/False
Question Political party may loose its exemption if it fails to maintain
record of all voluntary contributions in excess of Rs 10000/-.
Correct Answer True
Your Answer True

Question The amount of capital gains not invested by the assessee for the
purchase or construction of the new property can be deposited
by the assessee under the Capital Gains Account Scheme :-

Your Answer 15000

Question Section 44AB of the income tax Act, provides that every person
carrying on business has to get his accounts audited by a
Chartered Accountant whose sales turnover or gross receipts :-

Question Assessee gets deduction of interest paid on borrowed capital if it
is used for :-

Question Remuneration received by a University Teacher received from
his college will be treated as his salary. However, if he receives
some honorarium for setting and correcting the question papers
from the University :-
Correct Answer Honorarium will be treated as Income from other sources
Your Answer Honorarium will be treated as Income from other sources

Question Mr. X an employee of the Central Government receives Rs
3,50,000 as gratuity at the time of his retirement on September,
2004 under new pension code, the total taxable income will be :-
Correct Answer Nil
Your Answer Nil

Question Rebate is allowed on any subscription made to the notified
deposit scheme, interest on which is not eligible for deduction
under Section 80L of the Act :-
Correct Answer Of a housing finance company , Of any authority satisfying the
needs of housing accommodations or planning & development of
cities, towns etc.
Your Answer Of a housing finance company , Of any authority satisfying the
needs of housing accommodations or planning & development of
cities, towns etc.
Select The Blank

Question The person who does not deduct the tax source as required by
the Act or after deducting fails to pay the tax as required by the
Act, shall be liable to pay the simple interest @________ % per
month on the amount of such tax from the date on which the tax
was deductible till the date on which such tax is actually paid.
Correct Answer 1
Your Answer 2
Select The Blank

Select The Blank


Correct Answer It is an Indian Co. , It can be any other Co. , Has made
prescribed arrangements for declaration and payment of
dividend
Your Answer It is an Indian Co. , It can be any other Co. , Has made
prescribed arrangements for declaration and payment of
dividend

Question Value at which house property is offered for taxation under the
head income from house property is :-


Question The following relates to the head Income from Business of
Profession
Your Answer Unabsorbed Depreciation , Unabsorbed Business loss

True/False
Question Tea or other non-alcoholic beverages and snacks (in the form of
light refreshments) provided during the office hours are
chargeable in the hands of the employee..
Your Answer False
Match The Following

Superannuation Fund It is an employee welfare It is an employee welfare

scheme scheme
Statutory Provident Fund This is set up as per the Rebate U/s 88D allowed.
provisions of Provident
Fund Act, 1925.
Recognized Provident the provisions of the provisions of
Fund Employees Provident Employees Provident Fund
Fund and Miscellaneous and Miscellaneous
Provisions Act, 1952 apply Provisions Act, 1952 apply
to this fund. to this fund.
Unrecognized Provident The provident fund which The provident fund which
Fund is not recognized by the is not recognized by the
income tax authorities . income tax authorities .


taxes
Your Answer Principal portion of borrowed capital , Standard deduction ,
Interest on borrowed capital
Select The Blank

Question Monetory Limit for deduction for royalty income of authors under
Section 80QQB is Rs.________.
Your Answer 300000

Your Answer It will still be treated as a firm
True/False
Correct Answer True
Your Answer False

Question During the current Assessment Year, Mr. A bought 1000 Equity
Shares of A Ltd., a company manufacturing paper, which had
issued 10,00,000 Equity Shares of Rs. 10 each. What is the
Your Answer Rebate will be available u/s 88D

Your Answer Purchase of Building , Purchase of machinery
Select The Blank

Question If the self occupied property is constructed or acquired with the
borrowed capital before 01.04.1999 maximum deduction will be
________.

Question In respect of leave travel concession If Mr. A has availed the
exemption only once or has not availed any exemption at all, in
the block of four years i.e. 1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of four years
i.e. 2002-2005 provided that he avails the exemption of LTC in
Your Answer He can carry over the exemption to the next block of four years
i.e. 2002-2005 provided that he avails the exemption of LTC in
the fourth calendar year of the next block i.e. 2005.

Your Answer Cheque

Question Which of the following expenditures are expressly disallowed to
be deducted while computing the profits from business and
profession
True/False
Question Cost of improvement does not include any expenditure which is
deductible from any other head of income.
Correct Answer True
Your Answer True

Your Answer If the debentures are issued by a widely held company and the
Select The Blank

Question Belated return can be filed at any time before the expiry of one
year from the end of the relevant ________ or before the
completion of assessment, whichever is earlier.

years
Select The Blank

Question Where an assessee files or submits the returns as per provisions
of section 139 or in response to the notice under section 142, the
assessment officer undertakes ________ as per section 143(2)
and section 143(3).
Select The Blank

conditions.
Correct Answer None
Your Answer Not applicable

Question The provisions for payment of gratuity is not allowed under
section 40A(7) but, under the head, profits from business and
profession, the amount of gratuity will be allowed as deduction
only when :-
Correct Answer The amount of gratuity has actually become payable to the
employees during the previous year , The provision has been
made for the payment of a sum by way of contribution to an
approval gratuity , The other than the above two situations, any
provision made for the payment of gratuity is not allowed as
deduction
Your Answer The provision has been made for the payment of a sum by way
of contribution to an approval gratuity , The amount of gratuity
has actually become payable to the employees during the
previous year
Select The Blank

relevant previous year for the purpose of employment has to be
in India for ________ days or more during previous year.
Correct Answer 182
Your Answer 180
Select The Blank

Question AOP id formed when two or more ________ come together to
earn income.
Match The Following


etc.
100% 100%
60% 60%

Question Deduction from Gross Total Income in respect of payment of
Medical Insurance Premium is available under Section :-

Your Answer Net annual value

Question For the purpose of section 80IA, the term eligible business
means :-
Correct Answer Developing, maintaining or operating any infrastructure facility
where the term infrastructure facility means a road (including a
toll road, a bridge or a rail system) or a highway project or a
water supply project. , Developing, maintaining or operating an
Your Answer Developing, maintaining or operating any infrastructure facility
where the term infrastructure facility means a road (including a
toll road, a bridge or a rail system) or a highway project or a
water supply project. , Developing, maintaining or operating an
Select The Blank

Question If the CC of the engine is less than 1.6 liters and the motor car is
owned or hired by the employer and is used partly of official and
partly for personal purposes and if running and maintenance
expenses are borne by the employee then the value of perquisite
will be Rs.________ per month plus Rs.600 if car is chauffer
driven car.
Correct Answer 400
Your Answer 400
True/False
Question If the amount of tax payable by the assessee is higher than the
combined amount of tax deducted at source and advance tax,
such tax along with the amount of interest payable should be
paid by the assessee at the time of filing the return of income
Correct Answer True
Your Answer True
True/False
Question The amount of telephone bills (including the mobile phone bills)
of the employee reimbursed by the employer is taxable in the
hands of the employee.
Your Answer False
Select The Blank

True/False
Your Answer False

Your Answer Income from supply of water & electricity with in its jurisdiction
True/False
Your Answer False

Question Section 2(36) of Income Tax Act indicates that the word
"Profession" :-
Match The Following

Deduction in case of Section 80U Section 80U

permanent physical
disability
Deductions for Donations Section 80G Section 80G
Paid
Deduction in respect of Section 80L Section 80L

Interest on Bank Deposits
Select The Blank

is higher.
True/False
Your Answer True
True/False
Correct Answer True
Your Answer True
Select The Blank

Question Section 43B of the IT Act provides that the certain payments are
allowed as deduction only if they are ________.
Select The Blank

Question The amount of compensation received or receivable by the
employee from the employer at the time of termination of his
employment or at the time of modification of terms and
conditions in connection with the employment is called as
________.
Your Answer Workers compensation.

Your Answer The payment is made in the previous year
True/False
Question Entertainment Allowance is available for deduction only for the
Correct Answer True
Your Answer False
Select The Blank

Question Section 35AC of the Act applies to any sum paid by the
assessee to a public sector company or a local authority or an
association approved by the national committee for ________ for


Question Following incomes are deemed to have accrued or arisen in
India :-
India , Income from any capital asset situated outside India
Select The Blank

Question Deduction is available for ________ income from foreign
sources under Section 80RR.

Question Any loans or deposits borrowed or repaid under section 269SS
of the Act provides that the said provisions will not apply to the
loans or deposits accepted by :-
Correct Answer Government , Government company , Banking company
Your Answer Government , Government company , Banking company

Correct Answer Policy taken by a person (usually employer) on the life of another
person (usually a senior employee) where the employee pays a
key role in the organization of the employer
Your Answer Policy taken by a person (usually employer) on the life of another
person (usually a senior employee) where the employee pays a
key role in the organization of the employer

Question Income of a professional association is exempt if its objectives
are :-

Taxation

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TAXATION

LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Select The Blank

Your Answer Rs 2,400

Multiple Choice Multiple Answer

Your Answer True

Select The Blank

Your Answer Persons under "One by Six" scheme

Multiple Choice Multiple Answer

Correct Answer Town planning , Company secretary , Accounting

Your Answer Town planning , Company secretary , Accounting

Multiple Choice Multiple Answer

Your Answer Refund of Income tax , Capital Gains , Dividend Income

Select The Blank

Correct Answer Excise duty

Your Answer Excise duty

Select The Blank

Your Answer House rent allowance

Multiple Choice Multiple Answer

Your Answer The individual himself , A minor of whom he is the guardian.

Select The Blank

Correct Answer Permanent physical disability

Your Answer Permanent physical disability

Multiple Choice Single Answer

Multiple Choice Single Answer

Multiple Choice Single Answer

Correct Answer It is taxable as Income from Salaries.

Your Answer It is taxable as Income from Salaries.

Multiple Choice Single Answer

Your Answer Equal amount

Your Answer True

Multiple Choice Single Answer

Your Answer 0.5% of sales turnover/gross receipts or Rs.1lakh whichever is less

Select The Blank

Your Answer Non-ordinary resident assessees

Multiple Choice Multiple Answer

Your Answer False

Select The Blank

Correct Answer Income from salaries

Your Answer Income from salaries

Multiple Choice Multiple Answer

Select The Blank

Your Answer 88B

Your Answer True

Your Answer False

Multiple Choice Multiple Answer

Multiple Choice Single Answer

Your Answer Section 44AB of the Act

Multiple Choice Single Answer

Your Answer Rebate will be available u/s 88

Multiple Choice Single Answer

Correct Answer It will not constitute a separate taxable entity

Your Answer It will not constitute a separate taxable entity

Multiple Choice Single Answer

Your Answer Tax deduction at source

Multiple Choice Multiple Answer

Your Answer Income Tax , Wealth Tax

Your Answer False

Select The Blank

Your Answer Promotion of social and economic welfare

Multiple Choice Single Answer

Correct Answer Other sources

Your Answer Subletting