Taxation Law Codes Presents Cs Executive Tax Laws - 59cd7a9a1723dda4f28dee1e PDF

JMD TAXATION & LAW CODE Page |0
For CA, CS & OTHER PROFESSIONAL 2014
COURSES
CS-EXECUTIVE TAX
LAWS MCQ’s
TAXATION & LAW CODE’S

PRESENT’S
BY: - KETAN SARDANA
@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

Contact: - https://www.facebook.com/pages/Taxation-Law-CODES/185533964799625
https://www.facebook.com/groups/caketansardana/
https://www.facebook.com/ketan.sardana2
PREFACE TO MY FIRST EDITION

It gives me immense pleasure, in helping the student community in
particular by writing some notes in a simple, lucid manner.
Since, the book assumes no previous knowledge of the subject on the part
of, the Reader, its aims complete clarity for the beginner and simplicity
which makes the text self-explanatory,
I express my sincere gratitude to, all those who have stood by me, in this
noble task.
I, take this opportunity, in thanking my parents, my friends, readers, my
well-wishers, and yes God for their blessings and support,
I feel confident that the notes will meet a real need. If it is widely read and
wisely used, I shall feel amply rewarded.
I shall gratefully acknowledge any suggestions to further increase the utility
of the book, and readily incorporate them for the betterment of my next
edition of notes
DON’T COPY, RESPECT EFFORT BEHIND THIS.

Link to contact me:-
@ Copyright: KETAN SARDANA;ketanhsardana@gmail.com

Contact:https://www.facebook.com/pages/Taxation-Law-CODES/185533964799625

This Book is dedicated to LORD GANESHA

and SARASWATI MAA

DIRECT TAX
Multiple Choice Questions

1.The following is capital receipt:
(a) Dividend from investment;
(b) Bonus shares;
(c) Sale of technological know- how;
(d) Compensation received for compulsory evacuation of place of business.
2. Following is not a capital receipt:
(a) Dividend on investment;

(b) Bonus shares;
(c) Sale of know-how;
(d) Compensation received for vacating business place.
3.An individual is said to be resident in India in a previous year (in which the February month has 29
days) if he is in India in that year for a period or periods amounting in all to 182 days or more,
[(a) 182, (b) 183, (c) 60, (d) 150]

4 The assessee is charged to income-tax in the assessment year following the previous year:
(a) A non-resident business firm which shipped goods on 1.5.2013 at Visakhapatnam Port in
Andhra Pradesh
(b) An employee left India to USA on 1.8.2013 with no intention of returning
(c) ABC firm which discontinued its business on 1.9.2013
(d) An employee-assessee of a University who worked during 1.4.13 to 30.03.2014
5. Income received in India in previous year is taxable in the hands of:
(a) Resident;
(b) Not-resident;
(c) Non ordinarily resident;
(d) All above
6. Expenditure incurred by an employer on medical treatment and stayabroad of the employee

shall not be taxed in the case of ___________.
(a) an employee whose gross total income before including the said expendituredoes not exceed Rs. 2
lakhs.
(b) an employee whose income under the head "Salaries" exclusive of all monetary perquisites does
not exceed Rs. 2 lakhs,
(c) an employee whose income under the head "Salaries" exclusive of all non-monetary
perquisites does not exceed Rs. 2 lakhs,
(d) all employees irrespective of their amount of gross total income/the amountof income under the
head "Salaries".
7. If an employer transfers second hand motor car to the employee, the perquisite is valued at –
(a) Actual cost less depreciation @ 30% for every completed year under straightline method
(b) Actual cost less depreciation @ 20% for every completed year under WDV method
(c) Actual cost less depreciation @ 30% for every completed year under WDV method
(d)Actual cost less depreciation @ 20% for every completed year under SLM method.
8.The following is exempt income :—
(a) Travel concession to employee
(b) Remuneration received for valuation of answer scripts
(c) Encashment of leave salary whilst in service
(d) Perquisites in India
9. The following is not taxable as income under the head "Salaries":-

(a) Commission received by a full-time director;
(b) Remuneration received by a partner;
(c) Allowances received by an employee;
(d) Free accommodation given to an employee.

10. If an assessee earns rent from a sub-tenant in respect to tenanted property let out as a residence,
the said rent is:
(a) Exempt under Section 10.
(b) Taxable under the head income from house property.
(c) Taxable as business income, as the letting out is a commercial activity.
(d) Taxable as income from other sources, unless the assessee is in the business of subletting
properties on a regular basis.
11. X Ltd. has failed to remit the tax deducted at source from annual rent of Rs. 6,60,000 paid to Mr.
A for its office building. Said rent is —
(a)fully allowable as a business expenditure;
(b)not allowable in view of Section 40(a)(i);
(c)allowable to the extent of 50%;
(d)none of the above.
12. A partnership firm's profit as per the profit and loss account is Rs. 10,00,000. Its total income
determined according to the provisions of the Income-tax Act, 1961 is Rs. 9,00,000. A partner who
has 20% share in the firm can claim exemption of amount of Rs. __________under Section 10(2A).
(a) 2,00,000,(b) 1,80,000, (c) 20,000 (d) None of the above
13. Expenditure incurred in carrying out illegal business is—

(a) Not allowed as deduction in any case.
(b) Allowable as deduction, if gross total income is less than Rs. 5 lakhs.
(c) Allowable as deduction in all cases.
(d) Allowable as deduction, if income from illegal business is offered to tax.
14. if any expenditure is incurred by an Indian company wholly and exclusively for purpose of
amalgamation or demerger, the said expenditure is —
(a) not allowable as a deduction as a deduction in computing "Profits and gains from business or
profession"
(b) Fully deductible as revenue expenditure in the year in which it is incurred.
(c) allowable as a deduction, spread over eight successive previous years beginning if the previous year
in which the amalgamation or demerger taken place.
(d) allowable as a deduction, spread over five successive years beginning with the previous year in
which the amalgamation or demerger taken place

15. If any expenditure is incurred by an Indian company wholly and exclusively for the purpose of
amalgamation or demerger, the said expenditure is —
(a) Not allowable as a deduction in computing profits and gains of business or profession.
(b) Fully deductible as revenue expenditure in the year in which it is incurred.
(c) Not deductible but is eligible to be treated as an intangible asset in respect of which depreciation
can be claimed.
(d) Allowed as a deduction spread over five successive previous year beginning with the previous year
in which the amalgamation or demerger takes place.
16. Deduction for bad debts is allowed to an assessee carrying on business —

(a) In the year in which the debt is written off as bad.
(b) In the year in which the debt first arose.
(c) In the year in which provisions was made in respect of the bad debt.
(d) In the year in which the debt becomes irrecoverable by operation of law
17. Under Section 41(4) of the Income-tax Act, 1961, where a bad debt allowed as a deduction under
Section 36(1)(vii) in an earlier year is subsequently recovered —
(a) It is taxable to the extent of 50% of recovery, in the year of receipt, as business income.
(b) It is taxable as business income in the year of recovery.
(c) It is added back to the income of the year when it was written off and taxable business income.
(d)It is taxable as income from other sources in the year of receipt.
18. Payment of interest to partners of partnership firm assessed as firm is allowable as deduction
under Section 40(b) of the Income Tax Act, 1961.
(a) If the rate of interest does not exceed 8% p.a.

(b) If the interest is paid on the minimum balance of capital account between10th and the end of
every month.
(c) If it is calculated on quarterly balance.
(d) If it is authorized by and in accordance with the partnership deed, pertains to period after the deed
and does not exceed 12 percent simple interest per annum.
19. The following is not 'plant' u/s 43(3) of the Income-Tax Act, 1961 —
(a) Books
(b) Know-how
(c) Road in the factory building
(d) Electrical fittings

20. Mr. L Singhused it in his business. This is the only asset in the block. 20% of the usage is for
personal purposes. The WDV of the block as on 31.3.2014 is —
(a) Rs. 2,70,000;
(b) Rs. 2,55,000;
(c) Rs. 2,10,000;
(d) None of the above.
.
21. Long-term capital gains arising on compulsory acquisition of agricultural land held by a domestic
company within specified urban limits is —
(a) not exempt under Section 10(37);

(b) exempt under Section 10(37) in full;
(c) 50% of the receipt is exempt under Section 10(37);
(d) 25% of the receipt is exempt under Section 10(37).
22. In case of an investor in shares, in respect of shares sold, securities transactions tax paid (at the
time of purchase of the said shares earlier), is —
(a) to be added to the cost of acquisition;

(b) to be deducted as an expenditure connected with transfer;
(c) not deductible at all while computing capital gains;
(d) none of the above.
23. In respect of listed shares held for 10 months sold on 12.8.2010, the rate of tax in respect of
capital gains is —
(a) 10%;
(b) 20%;
(c) 15%;
(d) not determinable, as the capital gains will form part of the total incomewhose other
components are not known.
24. Capital gains arising to an individual/HUF is exempt from tax under section 10(37) if the land
was being used for agriculture purposes by such HUFor individual or parent of his during a period
of or more immediately preceding the date of transfer.
(a)2 years,(c) 12 months,
(b)36months,(d)6months

25. Long term capital gain arising to an assessee on the sale of a capital asset is exempt under Section
54EC of the Income-tax Act, 1961 —
(a) To the extent of investment in specified bonds up to a limit of X 100 lakhs.
(b) To the extent of 50% of investment in certain bonds up to a limit of Rs. 50 lakhs.
(c) To the extent of investment of capital gain in specified bonds not exceeding Rs. 50 lakhs.
(d) Proportionate to the extent of investment of net sale proceeds in specified
bonds, not exceeding Rs. 50 lakhs.
26.(A)Gift received from one or more unrelated person(s) during the previous year shall form part of
an individual's income, if the aggregate of gifts exceeds —
(a) Rs. 50,000

(b) Rs. 1,00,000
(c) Rs. 1,35,000
(d) Rs.1,65,000
27. Cash gift received under Section 56(2)(vii) from non relatives are not taxable upto —
(a) Rs. 1,00,000;
(b) 175,000;
(c) Rs. 50,000;
(d) Rs. 25,00
28 Mr. X gifts Rs.60,000 to the HUF of which he is member; said amount will be treated as income
of —
(a) Mr. X;
(b) The HUF;
(c) None, as it is exempt;
29. Mr. A has three minor children deriving interest from bank deposits to of the tune of Rs.2,000,
Rs.1,300 and Rs.1,600 respectively. Exemption available under Section 10(32) of the Income-tax Act,
1961 is-
(a) Rs. 4,900;(c)Rs. 4,500;

(b) Rs. 4,300;(d)None of above
30. Miss Femina, aged 17, is married to Mr. Masculine. Her mother alone is alive. Income by way
of interest on loans, of Miss Femina will be -
(a) Assessed to tax in the hands of Mr. Masculine;
(b) Assessed to tax in the hands of her mother;
(c) Taxable in own hands;

31. Government's contribution to the new pension scheme referred to inSection 80CCD is -
(a) an exempt income;
(b) income chargeable to tax as "Salaries" in full;
(c) 50% thereof is income chargeable to tax as "Salaries";
(d) Income chargeable to tax as "Income from other sources" in full.
32. In case of a hospital built in specified area after 31.3.2014 fulfilling the required conditions laid
down in Section 80IB-(11C), the profits and gains derived from running the hospital are
(a) deductible in full;

(b) deductible to the extent of 50%;
(c) deductible to the extent of 75%;
(d) taxable in full.
33. The registration of a charitable trust can be cancelled under Section 12AA of the Income-tax
Act, 1961 by —'
(a) Assessing Office;
(b) Commissioner of Income-tax;
(c) Chief Commissioner of Income-tax;
(d) Central Board of Direct Taxes.
34. The income of any university or other educational institution existingsolely for educational
purposes and not for the purposes of profit is exempt underclause (iiiad) of Section 10(23C) if the
aggregate annual receipts'of such university or educational institution do not exceed Rs.
(a) Rs.100crores,(c) Rs. 10crores,

(b) Rs.1 crore,(d) Rs. 10 lakhs
35. Any income chargeable under the based "Salaries" is exempt fromtax under Section 10(6)(viii),
if it is received by any non resident individual asremuneration for services rendered in connection
with his employment in a foreign ship where his total stay in India does not exceed a perioddays
in that previous year.
(a) 90
(b) 182
(c) 60
(d) 120
36. The following is not a venture capital undertaking for the purposes of Sec.10(23F), if
engaged in business of-
(a) Generation of power

(b) Telecommunications
(c) Providing infrastructural facility
(d) Dairy farming whose shares are not listed in a recognized stock exchange
JMD TAXATION & LAW CODE P a g e | 10
37. In case of companies deriving loss for any assessment year, filling of return of income within the
due date laid down in Section 139(1) is compulsory
(a) only where the Department issues notice to the assessee-company;
(b) for domestic companies only;
(c) for foreign companies only;
(d) for all companies
38. Where assessment has not been completed, belated income-tax return for assessment year
2014-15 can be filed upto
(a) 31-03-2016
(b) 31-12-2014
(c) 31-03-2015
(d) 31-12-2013
39. The due date for filing return of net wealth of an individual, who is a partner in a firm, whose turnover
for the year ended 31-03-2014 exceeds Rs. 60 lacs, is
(a) 30th June, 2014
(b) 31st July, 2014
(c) 31st October, 2014
(d) None of the above
40. Where the karta is not available, the return of wealth of a HUF can be signed by:
(a) Any adult member of the family;
(b) Any adult coparcener of the family:
(c) The male member who is next in seniority to the karta;
41. Following Form Number is to be used for filing the return of income by an individual having
business income:
(a) Form No. 1;
(b) Form No. 2;
(c) Form No. 4;
(d) Form No. 4A.
42. Surcharge of 2.5% is payable in the case of companies, by

(a) domestic companies only;
(b) companies other than domestic companies;
(c) all companies;

43. Which one of the following is an "asset" as per Section 2(ea) of the Wealth-tax Act?
(a) Any residential property forming part of stock-in-trade
(b) Any residential house that has been let out for a minimum period of 180days during the
previous year
(c) Commercial complex
(d) House occupied for the purpose of assessee's business.
44. Under the Wealth Tax Act, 1957 the time limit for completion of regular assessment ismonths
from the end of relevant assessment year.
(a) 21
(b) 12
(c) 24
(d) None of the above
45. In valuation of immovable property in Bangalore, the specified area means of the
aggregate area, for wealth-tax purpose.
(a) 60%
(b) 65%
(c) 70%
(d) 75%
46.The following is not an asset as envisaged by Sec.2(ea) of the Wealth-tax Act.

(a) Bullion
(b) Urban Land
(c) Jeep used in business of manufacture of medicines
(d) Motor boats of fishing business
47. Surcharge of 10 per cent is payable by an individual where the total income exceeds:
a) Rs.7,50,000 b) Rs.8,50,000 c) Rs.10,00,000 d) None of the three
48. Additional surcharge (education cess) of 3% per cent is payable on

a) Income tax b) Income tax plus surcharge c) Surcharge
49. Family pension received by a widow of a member of the armed forces where the death of the
member has occurred in the course of the operational duties, is
a) Exempt up to Rs.3,00,000 b) Exempt up to Rs. 3,50,000
c) Totally exempt under section 10(19) d) Totally chargeable to tax

50. In respect of shares held as investment, while computing the capital gains, securities
transaction tax paid in respect of sale of listed shares sold in a recognized stock exchange,
a) Is deductible up to Rs.1,00,000 b) Is deductible up to Rs.2,00,000
c) Is deductible if C.G.’s is < 5,00,000 d) Is not deductible at all
51. Gift of Rs 5,00,000 received on 10 July, 2008 through account payee cheque from a non-relative
regularly assessed to income-tax, is
a) A capital receipt not chargeable to tax b) Chargeable as other sources
c) Chargeable to tax as business income
d) Exempt up to Rs.50,000 and balance chargeable to tax as income from other source
52. The rate of tax that is leivable on STCG arising from transfer of Equity shares of a Company or
units of an Equity oriented fund is
a) 10% b) 15% c) 20%
53. For an employee in receipt of hostel expenditure allowance for his three children, the
maximum annual allowance exempt under section 10(14) is
a) Rs.10, 800 b) Rs.7,200 c) Rs.9,600 d) Rs.3,600
54. For an industrial undertaking fulfilling the conditions, additional depreciation in respect of
machinery costing Rs.10 lakh acquired and installed on October 3, 2005 is
a) Rs.75,000 b) Rs.1,50,000 c) Rs.1,00,000 d) None of the above
55. Assessee is always a person but a person may or may not be an assessee.
a) True b) False
56. A person may not have assessable income but may still be assessee.
a) True b) False
57. In some cases assessment year and previous year can be same financial year.
a) True b) False
58. A.O.P should consist of :

a) Individual only b) Persons other than individual only c) Both the above
59. Body of individual should consist of:

a) Individual only b) Persons other than individual only c) Both the above

60. A new business was set up on15-11-2013 and it commenced its business from 1-12-2013.Thefirst
previous year in this case shall be:
a) 15-11-2013 to 31-3-2014 b) 1-12-2012 to 31-3-2013 c) 2010-2009
61. A person leaves India permanently on 15-11-2013.The assessment year for income earned
till15-11-2013 in this case shall be:
a) 2011-12 b) 2013-14 c) 2009-10
62. Surcharge in case of an individual or HUF for assessment year 2013-14 is payable at the rate of :
a) 12% of the income-tax payable provided the total income exceed Rs.60,000.
b) 10% of the income-tax payable provided the total income exceeds Rs.1,00,00,000
c) 5% of the income-tax payable if the total income exceeds Rs.8,50,000
63. Surcharge in case of a firm for assessment year 2014-15 is payable at the rate:
a) 2.5% of income-tax payable b) 5% of income-tax payable c) 10% of income-tax payable
64. The maximum amount on which income-tax is not chargeable in case of firm is:
a) Rs.1,00,000 b) Rs. 90,000 c) Nil
65. The maximum amount on which income-tax is not chargeable in case a co-operative society is:
a) Rs.50,000 b) Rs.30,000 c) Rs 10,000
66. A local authority is taxable at flat rate of income-tax.

a) True b) False
67. A co-operative society is taxable at flat rate of 30% on TI.

a) True b) False
68. Education cess is leviable @:

a) 3% b) 5% c) 2.5%
69. Education cess is leviable in case of:

a) An individual and HUF b) A company assessee only c) All assesses
70. In case of an individual and HUF education cess is leviable only when the total income of such
assessee
a) Exceeds Rs.10,00,000 b) No income limit

71. The TI of the assessee has been computed as Rs.2,53,494.90. For rounding off ,the TI will
betaken as:
a) Rs.2,53,500 b) Rs.2,53,490 c) Rs.2,53,495
72. Income tax is rounded off to:

a) Nearest ten rupees b) Nearest one rupee c) No rounding off of tax is done
73. A’s TI for the A.Yr.2014-15 is Rs.12,00,000.His tax liability shall be

a) 1,80,000 b) 1,90,000 c) 1,91,330
74. Residential status to be determined for :

a) Previous year b) Assessment year c) Accounting year
75. Incomes which accrue or arise outside India but are received directly into India are taxable in
case of
a) Resident only b) Both ordinarily resident and NOR c) Non-resident d) All the assesses
76. Income deemed to accrue or arise in India is taxable in case of :

a) Resident only b) Both ordinarily resident and NOR c) Non-resident d) All the assesses
77. Income which accrue outside India from a business controlled from India is taxable in case of:
a) Resident only b) Not ordinarily resident only
c) Both ordinarily resident and NOR d) Non-resident
78. Income which accrue or arise outside India and also received outside India taxable in case of:
a) resident only b) not ordinarily resident
c) both ordinarily resident and NOR d) none of the above
79. TI of a person is determined on the basis of his:

a) residential status in India b) citizenship in India c) none d) both of the above
80. Once a person is a resident in a P.Yr. he shall be deemed to be resident for subsequent P. Yr.
a) True b) False
82. R Ltd., is an Indian company whose entire control and management of its affairs is situated
outside India. R Ltd., shall be :
a) Resident in India b) Non-resident in India c) Not ordinarily resident in India

83. R Ltd., is registered in U.K. The control and management of its affairs is situated in India .R Ltd
shall be :
a) Resident in India b) Non-resident c) Not ordinarily resident in India
84. R, a foreign national visited India during previous year 2013-14 for 180 days. Earlier to this he
never visited India. R in this case shall be:
a) Resident in India b) Non-resident c) Not ordinarily resident in India
85. An Indian company is always resident in India

a) True b) False
86. Dividend paid by an Indian company is:

a) Taxable in India in the hands of the recipient b) Exempt in the hands of recipient
c) Taxable in the hands of the company and exempt in the hands of the recipient
87. Agricultural income is exempt provided the:

a) Land is situated in India b)Land is situated in any rural area India
c) Land is situated whether in India or outside India.
88. If the assessee is engaged in the business of growing and manufacturing tea in India
,theagricultural income in that case shall be:
a) 40% of the income from such business b) 60% of the income from such business
c) Market value of the agricultural produce minus expenses on cultivation of such produce
89. Agricultural income is :

a) Fully exempt b) Partially exempt c) Fully taxable
90. The partial integration of agricultural income, is done to compute tax on:
a) Agricultural income b) non agricultural income
c) Both agricultural and non agricultural income
91. There will be no partial integration of agricultural income with non agricultural income, if the
non agricultural income does not exceed:
a) Rs.2,00,000 b) Rs. 1,00,000 c) Rs.1,10,000
92. There will be no partial integration, if the agricultural income does not exceed:
a) Rs.40,000 b) Rs.50,000 c) Rs.5,000

93. A local authority has earned income from the supply of commodities outside its own
jurisdictional area. It is :
a) Exempt b) Taxable
94. R, a chartered accountant is employed with R Ltd., as an internal auditor and requests the
employer to call the remuneration as internal audit fee. R shall be chargeable to tax for such fee
under the head.
a) Income from salaries b) Profit and gains from Business and Profession
c) Income from other sources.
95. R who is entitled to a salary of Rs.10,000 p.m. took an advance of Rs.20,000 against the salary
in the month of March 2013.The gross salary of R for assessment year 2014-15 shall be:
a) Rs.1,40,000 b) Rs.1,20,000 c) None of these two
96. A is entitled to children education allowance @ Rs. 80 p.m. per child for 3 children amounting
Rs. 240 p.m. It will be exempt to the extent of :
a) Rs.200 p.m. b) Rs.160 p.m. c) Rs. 240 p.m.
97. R gifted his house property to his wife in 2000. R has let out the house property @ Rs.5,000
p.m. The income from such house property will be taxable in the hands of :
a) Mrs. R
b) R. However , income will be computed first as Mrs. R’s income and thereafter clubbed in the
income of R
c) R as he will be treated as deemed owner & liable to tax
98. R transferred his house property to his wife under an agreement to live apart. Income from
such house property shall be taxable in the hands of :
a) R as deemed owner
b) R. However, it will be first computed as Mrs. R income & Thereafter clubbed in the hands of R
c) Mrs. R
99. R gifted his house property to his married minor daughter. The income from such house
property shall be taxable in the hands of :
a) R as deemed owner.
b) R. However, it will be first computed as minor daughters income & clubbed in the income of R.
c) Income of married minor daughter.

101. A has two house properties. Both are self-occupied. The annual value of
a) Both house shall be nil b) One house shall be nil c) No house shall be nil
102. An assessee has borrowed money for purchase of a house & Interest is payable outside
India. Such interest shall:
a) Be allowed as deduction b) Not to be allowed on deduction
c) Be allowed as deduction if the tax is deducted at source
103. Salary, bonus, commission or remuneration due to or received by a working partner

from the firm is taxable under the head.
a) Income from salaries b) Other sources c) PGBP
104. Perquisite received by the assessee during the course of carrying on his business or
profession is taxable under the head.
a) Salary b) Other sources c) PGBP
105. Interest on capital or loan received by a partner from a firm is:

a) Exempt U/S 10(2A) b) Taxable U/H business and profession
c) Taxable U/H income from other sources
106. Under the head Business or Profession, the method of accounting which an assessee can
follow shall be :
a) Mercantile system only b) Cash system only c) Mercantile or cash system only d)
Hybrid system
107. An asset which was acquired for Rs. 5, 00, 000 was earlier used for scientific research.
After there search was completed, the machinery was brought into the business of the
assessee. The actual cost of the asset for the purpose of inclusion in the block of asset shall be
a) Rs.5,00,000 b) Nil
c) Market value of the asset on the date it was brought into business
108. A car is imported after 1- 4- 2005 by R Ltd. from London to be used by its employee. R
Ltd. Shall be allowed depreciation on such car at:
a) 15% b) 40% c) Nil
109. Unabsorbed depreciation which could not be set off in the same assessment year, can be
carried forward for:
a) 8 Years b) Indefinitely c) 4Years

110. Certain revenue and capital expenditure on scientific research are allowed as deduction
in the previous year of commencement of business even if these are incurred:
a) Five years immediately before the commencement of business

b) 3 years immediately before the commencement of the business
c) Any time prior to the commencement of the business.
111. If any amount is donate for research, such research should be in nature of:
a) Scientific research only b) Social or statistical research only
c) Scientific or social or statistical research
112. Preliminary expenses incurred are allowed deduction in:

a) 10 equal annual installments b) 5 equal annual installments c) full
113. In case the assessee follows mercantile system of accounting, bonus or commission to
the
employee are allowed as deduction on:
a) Due basis b) Payment basis c) Due basis but subject to section 43B
114. Interest on money borrowed for the purpose of acquiring a capital asset pertaining to
the period after the asset is put to use is to be:
a) Capitalized b) Treated as revenue expenditure
115. Expenditure incurred on purchase of animals to be used by the assessee for the purpose
of carrying on his business& profession is subject to
a) Depreciation
b) Deduction in the previous year in which animal dies or become permanently useless
c) Nil deduction
116. Expenditure incurred on family planning amongst the employees is allowed to

a) Any assessee b) A company assessee c) An assessee which is a company or cooperative
society
117. Interest on capital of or loan from partner of a firm is allowed as deduction to the firm to
the extent of:
a) 18% p.a. b) 12% p.a. even if it is not mentioned in partnership deed
c) 12% p.a. or at the rate mentioned in partnership deed whichever is less.

118. Deduction under section 40(b) shall be allowed on account of salary /remuneration paid
to :
a) Any partner b) Major partner only c) Working partner only
119. Remuneration paid to working partner shall be allowed as deduction to a firm:

a) In full b) Subject to limits specified in section 40(b) c) None of these two
120. A firm business income is nil /negative. It shall still be allowed as deduction on account
of
remuneration to working partner to the maximum extent of:
a) Actual remuneration paid as specified in partnership deed b) Rs.50,000 c) Nil
121. For person carrying on profession, tax audit is compulsory, if the gross receipts of the
previous year exceeds:
a) Rs.50 lakhs b) Rs.40 lakhs c) Rs.25 lakh
122. Tax audit is compulsory in case a person is carrying on business whose gross
turnover/sales/receipts, as the case may be, exceeds:
a) Rs. 10 lakhs b) Rs. 40 lakhs c) 1 crore
123. In case an assessee is engaged in the business of civil construction, presumptive income
schemes applicable if the gross receipts paid or payable to him in the previous year does not
exceed:
a) Rs.10 lakhs b) Rs. 1 crore c) Rs. 50 lakhs
124. In the aforesaid case ,the income shall be presumed to be :

a) 5% of gross receipts b) 8% of gross receipts c) 10% of gross receipts
125. In case an assessee is engaged in the business of plying hiring or leasing goods carriage,
presumption income scheme under section 44AE is applicable if the assessee is the owner of
maximum of :
a) 8 goods carriages b) 10 goods carriages c) 12 goods carriages
126. In case an assessee is engaged in the business of retail trade, presumptive income
scheme is applicable if the total turnover of such retail trade of goods does not exceed:
a) Rs.10 lakhs b) Rs.30 lakhs c) Rs. 1 crore lakhs d) Rs.50 lakhs

127. In the above case the income to be presumed under section 44AF shall be :
a) 8% of total turnover b) 5% of total turnover c) 10% of total turnover
128. If the assessee opts for section 44AD or 44AF or 44AE,then the assessee shall:
a) Not be entitled to any deduction under sections 30 to 37
b) Be entitled to deduction under sections 30 to 37
c) Not be entitled to deduction under sections 30 to 37except for interest on capital or loan
from partner and remuneration to a working partner subject to conditions laid down under
section 40(b)
129. The period of holding of shares acquired in exchange of convertible debentures shall be
reckoned from:
a) The date of holding of debentures
b) The date of when the debentures were converted into shares
c) None of these two
130. Securities transaction tax paid by the seller of shares and units shall
a) Be allowed as deduction as expenses of transfer b) Not be allowed as deduction
131. The cost inflation index number of the P.Yr.2013-14 is :

a) 480 b) 519 c) 551 d) 939
132. Conversion of capital asset into stock in trade will result into capital gain of the previous
year:
a) In which such conversion took place
b) In which such converted asset is sold or otherwise transferred c) None of these two
133. Where a partner transfers any capital asset into the business of firm ,the sale
consideration of such asset to the partner shall be :
a) Market value of such asset on the date of such transfer
b) Price at which it was recorded in the books of the firm
c) Cost of such asset to the partner
134. Where the entire block of the depreciable asset is transferred after 36 months, there will
be:
a) Short-term capital gain b) Long-term capital gain
c) Short-term capital gain or loss d) Long-term capital gain or loss

135. In the case of compulsory acquisition, the indexation of cost of acquisition or

improvement shall be done till the :
a) Previous year of compulsory acquisition b) In which the full compensation received
c) In which part or full consideration is received
136. If good will of a profession which is self generated is transferred, there will:
a) Be capital gain b) Not be any capital gain c) Be a short-term capital gain
137. Exemption under section 54 is available to :

a) All assesses b) Individuals only c) Individual + HUF.
138. The exemption under section 54 ,shall be available:

a) To the extent of capital gain invested in the HP
b) Proportionate to the net consideration price invested
c) To the extent of amount actually invested
139. The exemption u/s 54B, is allowed to :

a) Any assessee b) Individual only c) Individual or HUF
140. For claiming exemption under section 54B the assessee should acquire:
a) Urban agricultural land b) Rural agricultural land c) Any agricultural land
141. New assets acquired for claiming exemption u/s 54, 54B or 54D,if transferred within 3
years, will result in:
a) Short-term capital gain b) long-term capital gain
c) ST or LTCG depending upon original transfer
142. Loss from a speculation business of a particular A. Yr. can be set off in the same A. Yr.
from:
a) Profit and gains from any business
b) Profit and gains from any business other than speculation business
c) Income of speculation business
143. Loss under the head capital gain in a particular assessment year can:
a) Be set off from other head of income in the same assessment year.
b) Be carried forward c) Neither be set off nor carried forward

144. The loss is allowed to be carried forward only when as assessee has furnished:
a) Return of loss b) Return of loss before the due date mentioned u/s 139(1)
c) Or not furnished the return of loss
145. Loss under the head income from house property can be carried forward:
a) Only if the return is furnished before the due date mentioned u/s 139(1)
b) Even if the return is not furnished c) Even if the return is furnished after the due date
146. Deduction u/s 80C in respect of LIP, Contribution to provident fund, etc. is allowed to :
a) Any assessee b) An individual
c) An individual of HUF d) An individual or HUF who is resident in India
147. Deduction under section 80C is allowed from:

a) Gross total income b) Total income c) Tax on total income
148. An assessee has paid life insurance premium of Rs.25,000 during the previous year for a
policy of Rs.1,00,000.He shall:
a) Not be allowed deduction u/s 80C
b) Be allowed Deduction u/s 80C to the extent of 10% of the capital sum assured i.e.Rs.10,000
c) Be allowed Deduction for the entire premium as per the provisions of section 80C
149. For claiming Deduction u/s 80C, the payment or deposit should be made:
a) Out of any income b) Out of any income chargeable to income tax
c) During the current year out of any source
150. Deduction under section 80C shall be allowed for :

a) Any education fee
b) Tuition fee exclusive of any payment towards any development fee or donation or payment
of similar nature c) Tuition fee and annual charges
151. Deduction under section 80CCC is allowed to the extent of :

a) Rs. 2,00,000 b) Rs. 1,00,000 c) Rs. 4,00,000
152. Deduction under section 80D in respect of medical insurance premium is allowed to:
a) Any assessee b) An individual or HUF
c) Individual or HUF who is resident in India d) Individual only
153. Deduction u/s 80D is allowed if the premium is paid to :

a) Life insurance Corporation
b) General insurance Corporation or any other insurer approved by IRDA
c) Life insurance or General insurance corporation

154. The payment for Insurance premium under section 80D should be paid:
a) In cash b) By any mode other than cash c) Cash/by cheque
155. The maximum deduction allowed under section 80D shall be limited to:
a) Rs.20,000 b) Rs.10,000 c) Rs. 15,000
156. Deduction U/s 80G on account of donation is allowed to:

a) A business assessee only b) Any assessee c) Individual or HUF only
157. The maximum deduction u/s 80GG shall be limited to:

a) Rs. 1,000 p.m. b) Rs. 2,000 p.m. c) Rs. 3,000 p.m.
158. Deduction u/s 80GGA in respect of certain donation for scientific research or rural
development allowed to:
a) any assessee b) non corporate business assessee
c) an assessee whose income does not include PGBP income.
159. Deduction under section 80DD shall be allowed:

a) To the extent of actual expenditure/deposit or Rs.40,000 whichever is less
b) For a sum of Rs.50,000 irrespective of actual expenditure or deposit
c) For a sum of Rs.40,000 irrespective of any expenditure incurred or actual deposited
160. The deduction u/s 80E is allowed for repayment of interest to the extent of :
a) Rs.25,000 b) Rs.40,000 c) Any amount repaid
161. The quantum of deduction allowed u/s 80U is :

a) Rs. 40,000 b) Rs. 50,000 c) Rs. 60,000
162. As per Sec.139(1), a company shall have to file return of income:

a) When its total income exceeds Rs.50,000
b) When its total income exceeds the maximum amount which is not chargeable to income tax
c) In all cases irrespective of any income or loss earned by it.
163. The last date of filing the return of income u/s 139(1) for A. Yr. 2014-15 in case of a
company assessee is
a) 30th November of the assessment year b) 30th September of the assessment year
c) 31st July of the assessment year d) 31st October of the assessment year

164. The last date of filing the return of income u/s 139(1) for assessment year 2014-15 in
case of anon corporate business assessee whose accounts re not liable to be audited shall be:
a) 31st July of the assessment year b) 30th June of assessment year
c) 31st October of the assessment year d) 30th September of the assessment year
165. For the P.Y. 2013-14 the business income of the assessee before providing C.Yr.
depreciation of Rs. 3,50,000 is Rs. 1,50,000. His due date of return was 30-09-2014 but he
submitted the return on 16-12-2013, the assessee in this case:
a)Be allowed to carry forward unabsorbed depreciation of Rs. 2,00,000
b)Not allowed to carry forward unabsorbed depreciation of Rs.2,00,000
166. K finds some mistake in the return of income submitted by him on 05-06-2013 for
assessment year 2014-15, he wishes to revised such return. No assessment has been done in
this case. K can revise such return till
a)31-03-2013
b)31-03-2016
c)31-03-2014
167. In case of assesses other than companies, the following is advance tax rate to be payable
on or before of 15lh September:
(a) 15 per cent(c)45 per cent
(b) 30 per cent(d)60 per cent

Fill in the Blanks

1. The basic exemption limit in case of a non-resident individual being a senior citizen of
Rs_______
2. Income-tax rates are not prescribed by the ______ Act, but by the ____ of each year.
3. The term business would include _______and accordingly the term business used in Section
________ would also include a professional connection.
4. Compensation received from an insurer on account of damage to the crops is _______
5. Receipts from TV serial shooting in farm house _______agricultural income.
6. Expenditure on free meals to employee in excess of Rs.___ per meal will be treated as
perquisite of employee.
7.Gift to employee upto Rs______per annum will not be treated as perquisite taxable in the
hands of employee.
8. Death-cum-retirement gratuity received by an employee of Central Government is wholly
exempt ____________
9.If loan granted by employer to employee does not exceeds Rs._______, it is not treated as
perquisite to employee for purpose of income tax.
10. Where an employer gifts a second hand motor car to an employee, the perquisite value is
actual cost less depreciation at ____for every completed year under ________method of
computing depreciation.
11. Any commission due or received by a partner of a firm from the firm shall not be regarded
as _____under section __
12 . _______salary is taxable, while _____against salary is not taxable.
13.Interest on capital borrowed for acquisition or construction of property is deductible subject
to limit of Rs. ____ per year, if capital is borrowed on or after ____. This is allowable if acquisition
or construction is completed within __years from ________
14. For a self-occupied house property occupied on 1.7.2013, for which housing loan was availed,
if the interest up to 31.3.2013 is Rs. 90,000 and thereafter the interest payable is Rs. 3,000 per
month, the deduction available under section 24 in respect of interest for the year ended
31.3.2014 is Rs______
15.An assessee, after sale of house property, receiving arrears of rent is (is\is not) chargeable to
tax; the same computed in the stipulated manner, is chargeable to tax as ___

16. The basis of chargeability under the head 'income from house property' is________
17. Arrear rent is taxable after deducting ___ as per Section 25B of the Income-tax Act, 1961.
18. In case of an existing industrial undertaking, to be eligible for additional depreciation,
increase in installed capacity as compared to the installed capacity as on 31.3.2014 is __per cent.
[Note: As criteria of increment in installed capacity for allowing additional depreciation is
now omitted]
19. The due date for filling return of net wealth by an individual who is a non-working partner
in a firm whose accounts are audited under Section 44AB of the Income-tax Act. 1961 is _____
20. A person owns 4 heavy goods vehicles. His estimated annual income U/S. 44AE is ______
21. According to Section 44AB, every person, carrying on business shall, if his total sales,
turnover or gross receipts, as the case may be, in business exceed or exceeds Rs._____ in any
previous year, inter alia, get his accounts of such previous year audited by a Chartered
Accountant.
22.Additional depreciation of 20% of the actual cost of any new machinery or plant which has
been acquired or installed 31.03.2005 is available to an assessee engaged in the business of ___
23. According to Section 40A(3), where the assessee incurs any expenditure in respect of which
payment is made in a sum exceeding Rs. __ otherwise than by a crossed cheque or crossed bank
draft. 100 percent of such expenditure shall not be allowed as a deduction.
24. The additional or accelerated depreciation, for an eligible assessee, for machinery installed and
used after 31.03.2014 is ________of the machinery.
25. Where an Indian company incurs any expenditure in connection with amalgamation or
demerger, the same is allowable as deduction, spread over 5 successive previous years
beginning with the _____
26. 44BBB(i) of the Income-tax Act, 1961, the presumptive income is taken as ___ of the eligible
receipts in the hands of eligible assessee.
27.The deduction for amortization of preliminary expenses under section 35D is allowable at
________of the qualifying expenditure in each of the ___successive years beginning with the
year in which business commences.
28. ________is a non-recurring expenditure whereas revenue expenses is normally a recurring
one.
29..______ defines various income which are chargeable to tax under the head "Profits and
gains of business or profession".
30. Expenditure incurred towards demerger is deductible in __ equal annual installments under
Section 35DD of the Income-tax Act, 1961.
31. 2010 - The cost of acquisition of 100 bonus shares, where the original shares (100 nos.)
were acquired for Rs.30,000 is ___
32. Interest on refund on Income-tax paid in excess is a _____receipt.
33. Amount received towards permission for putting up hoarding at the top of the building is
taxable under the head _________
34. Exemption u/s. 10(32) of IT Act 1961 in respect of income of minor child included in
the hands of assesses under Section 64(1A) is restricted to Rs. ___per child.
35. Assets held by minor married daughter ________(will/will not) be clubbed in the hands of
the individual.
36. For the applicability of clubbing provisions of the Wealth Tax Act, 1957, the expression
'child' includes _____child and _____child.
37.Accumulated losses of amalgamating company shall be allowed to be set off or carried
forward by amalgamates company, if the amalgamated company holds continuously for a
minimum period of 5 years from date of amalgamation at least three-fourths of _________ of
the amalgamating company. A. For a person suffering from server physical disability,
deduction available under Section 80U is Rs. _______
38. The tax rebate available under Section 80E to a Hindu Undivided Family resident in India
is Rs___
39. The maximum amount of permissible deduction under Section 80C,subject to overall ceiling
of Rs. ____, for repayment of principal part of eligible housing loan in Rs. any amount
subject to max of Rs.________ and that of interest is Rs.________
40..From out of his agricultural income, X has paid interest of Rs._____on education loan taken
from nationalized bank last year. Deduction available u/s80E of the Income Tax Act, 1961 is
Rs. NIL
41. Medical insurance premium paid otherwise than in cash is eligible for deduction under
Section ___ of the Income-tax Act, 1961.
42. To claim the benefit under Section 10A, SEZ undertaking having a turnover of rupees two crores,
should file the return of income on or before __________
43. Exemption under Section 10B of the Income-tax Act, 1961 is available till assessment year
________.While effecting the tax deduction at source, education cess and special higher
education cess totalling 3% need not (should/need not) be also deducted from the amount due
or payable to the deductee.
44. Belated return of income for the assessment year 2014-15 can be filed on or before
31st________. where no assessment has been made.

45. The due date for filling wealth-tax return by a closely held company, whose turnover is below
Rs. 40 lakhs, is 30th September.
46. Electronic furnishing of income-tax return in approved computerreadable media can be
furnished under sub-section (1B) of section ______ of theIncome-tax Act, 1961.
47. 2009 - Time limit for filling revised return when assessment has not beencompleted is
one year from the end of the relevant ___________.
48. Sec.________ applies to all persons whether they are resident ornon-resident.
49.. For the assessment year 2014-15, tax on distributed profits (dividend distribution tax) is
payable at _________
50. The rate of Minimum Alternate Tax has been increased from ______of book profits with
effect from assessment year 2014 -15.
51. Long term capital gain which are exempt u/s. _____ credited to profit a n d l o s s a c c o u n t
a r e s u b j e c t t o ( subject to/not subject to) Minimum Alternate Tax, from assessment year
2014-15.
52. A ______ company means a Company which is not a domestic company.
53. The rate of tax in case of Minimum Alternate Tax has been increased to _____ with effect
from Assessment year 2014 -15.
54. For a self-occupied house property occupied on July 1, 20013 for which housing loan was
availed, if the interest up to March 31,2013 is Rs.90,000 and thereafter the interest payable is
Rs.3,000 per month, the deduction available under section 24 in respect of interest for the year
ended March 31, 2004 is Rs. …………………………….
55. For a person suffering from severe physical disability, deduction available under section 80U
is
Rs………………………..
56. Accumulated losses of amalgamating company shall be allowed to be set off or carried
forward by amalgamated company, if the amalgamated company holds continuously for a
minimum period of …………………….. years from date of amalgamation at least three-fourth of
…………….of the amalgamating company.
57. An author of a work of literacy, artistic or scientific nature is entitled to deduction to certain
amount from his income. State the amount and section number under which he is entitled to
deduction ………………………….

58. Interest on capital borrowed for acquisition or construction of property is deductible

subject to limit of Rs. ………………… per year, if capital is borrowed on or after ………………. This is
allowable if acquisition or construction is completed within …………. Years from ………………
59. For the assessment year 2014-15, tax on distributed profits (divided distribution tax) is
payable at…………………% plus surcharge of ………………… if domestic company distributes dividend
on or after…………………..
60. The due date for filing of return under section 139(1) by a company having a turnover of
less than Rs.1 crore is …………..
61. Deduction under section 80GGC in respect of contribution to approved political parties
given by a local authority partly funded by the Government is ……..
62. Where a person transfers capital asset to a firm in which he becomes partner the full value
of consideration in the context of capital gain computation, will be ………….
63. For availing exemption under section 10A, return of income should be filed by a corporate
assessee on or before …………..
64. In case of an eligible assessee, imported second hand machinery never put to use by any
personin India before, additional or accelerated depreciation is allowable at the rate of ……….
on theactual cost of machinery.
65. Fringe benefit tax …………. an allowable item of business expenditure
66. Where an individual has repaid in the second year, Rs.20,000 towards principal and
Rs.60,000towards eligible education loan from an approved bank, the deduction available
under Section80E is Rs……………
67. As per section 2(47) …………., or ……….. of a zero coupon bond will be treated as “transfer”
for the purpose of capital gains tax
68. An Assessee, after sale of house property, receiving arrears of rent, ……… (is/isnot)
chargeable to tax; the same computed in the stipulated manner, shall be chargeable to tax as
……… (income from other sources / income from house property / question does not arise since
there is no chargeability to tax)
69. A motor car is the only Asset in a block. Cost Rs.2,00,000. Rate of depreciation is 15%. 20%
isdisallowed for estimated personal use. WDV of the block is Rs…………
70. Mr. A gifts cash Rs.1,00,000 to his brother’s wife Mrs.B, Mr.B gifts cash Rs.1,00,000 to Mrs
A.from cash gifted to her, Mrs.B invests in a fixed deposit, income there from is Rs.10,000. A
foresaid Rs.10,000 will be included in the total income of ……
71. The time limit for filing revised return where assessment has not been completed is
……………
72. The quantum of maximum deduction allowed u/s 80D for preventive health checkup shall
be limited to ………………

TRUE OR FALSE (WITH REASONS)
1. Where an urban agricultural land owned by an individual, continuously used by him for
agricultural purposes for a period of two years prior to the date of transfer, is compulsorily,
acquired under law and the compensation is fixed by the state Government, resultant capital
gain is exempt.
2. Where an individual repays a sum of Rs.30,000 towards principal and Rs.14,000 as interest in
respect of loan taken from a bank for pursuing eligible higher studies ,the deduction allowable
under section 80E is Rs.40,000 and not Rs.30,000 ( principal component only)
3. Business loss can be set off against salary income;
4. A has received gift to Rs.1,50,000 on December 12, 2005 from his close friend who is
assessed to income-tax . The same is taxable at the hands of A.
5. Long term capital gains arising from units of debt-oriented equity funds for which securities
transactions tax has been paid in a recognized stock exchange is exempt.
6. Under Section 35DDA, amortization of expenditure incurred under eligible Voluntary

Retirement Scheme at the time of retirement alone, can be done
7. Value of fringe benefit chargeable to tax under Chapter XII-H in the hands of the employer, is
not to be treated as a perquisite under Section 17(2), in the hands of the employee.
8. Zero coupon bonds of Eligible Corporation, held for more than 12 months, will be long-term
capital assets.
9. In the case of a dealer in shares, income by way of dividend is taxable under the head “profits
and gains of business or profession”.
10. Mr. Y who is a physically handicapped minor (suffering from a disability of the nature
specified in Section 80U) earns bank interest of Rs.50,000 and Rs.60,000 from making bags
manually by himself. The total income of Mr. Y shall be computed in his hands separatal
11. Only individuals and HUFs can be resident, but not ordinarily resident in India; firms can be
either a resident or non-resident.

12. In respect of voluntary contributions in excess of Rs.20,000 received by a political party,

exemption under section 13A is available where proper details about the donations are
maintained; there is no need to maintain books of account.
13. Depreciation is allowed only when it is claimed.
14. For grant of deduction under section 80-IB, filing of audit report in prescribed form is must
for a corporate assessee; filing of return within the due date laid down in section 139(1) is not
required.
15. From 1.6.2013 onwards, the Assessing Officer has the power, inter alia, to allot PAN to any
person by whom no tax is payable
16. Where the Karta of a HUF is absent from India, the return of income can be signed by any
male member of the family.
17. It is a condition precedent to write off in the books of account, the amount due from debtor
to claim deduction for bad debt.
18. Tax on fringe benefits provided for employment is payable by all employers
19. Failure to deduct tax at source in accordance with the provisions of chapter XVII-B, inter
alia, from the amounts payable to a resident as rent or royalty, will result in disallowance while
computing the business income.
20. Compensation on account of disaster received from local authority by an individual or

his/her legal heir is taxable.
21. Rural branches of the cooperative banks are not allowed to claim provision for bad and
doubtful debts.
22. Income to a non- resident by way of interest, royalty and fee for technical services deemed
to accrue or arise in India is taxable in India irrespective of territorial nexus.
23. Capital gain of Rs.75 lakh arising from transfer of long term capital assets will be exempt
from tax if such capital gain is invested in the bonds redeemable after three years, issued by
NHAI u/s 54EC of the Act.

24. X, Ltd. follows mercantile system of accounting. After negotiations with the bank, interest of
Rs.4lakhs (including interest of Rs.1.2lakhs pertaining to year ended 31.03.2007) has been
converted into loan. Can the interest of Rs.1.2lakhs so capitalized be claimed as business
expenditure.
25. Can a Primary cooperative Agricultural and Rural Development Bank claim deduction under
Sec.80P in respect of income derived from the business of banking
26. The total income of a University without giving effect to exemption under Sec.10(23C) is
Rs.46lakhs. Its total income however is nil. Should the university file its return of income
27. Ms. Vasudha contends that sale of work of art held by her is not eligible to capital gains tax.
28. Will a charitable trust forfeit the exemption granted to it, if it holds shares in a Public Sector
Company
29. Deduction u/s 80CCD is available only to individuals employed by C.G.
30. Mrs. Hemalatha has made payments of Rs.5lakhs to a contractor ( for business purposes)
during the last Quarters of the year ended 31.03.2014. Her turnover for the year ended
31.03.2014 wasRs.45lakhs. Is there any obligation to deduct tax at source
31. Can an individual who is not in India, sign the return of income from outside India.
32.'Gross Total Income' means aggregate of income computed under various heads and after
allowing deduction under Chapter Vl-A.
33. If a person is resident and ordinarily resident of India, his income earned outside India is
taxable in the country in which he earned that income.
34. Where a person does basic operations in lands and later sells the saplings grown by him in
a nursery owned by him, the same will be agricultural income. If the basic operations are not
done by the assessee and the saplings are sold in his nursery, the same will still be regarded as
agricultural income.
35. Any income derived from saplings or seedlings grown in a nursery shall be deemed to be
agricultural income.
36. Vivitha, a Cost Accountant, is employed in Hema Plastics Ltd. The company pays the annual
Cost accountant membership fee. The fee so paid by the company is not to be treated as a
perquisite in the hands of Vivitha.

37. X is employed in Complex Ltd. as a Chartered Accountant. The annual membership fee of X
paid by Complex Ltd. is not a perquisite and hence not chargeable to tax.
38. Rental income from residential property owned by a company carrying on business of property
rentals is taxable under the head "Income from House Property".
39. Business expenses are allowed to be deducted from" business income even if they are in
the nature of personal expenditure of the assessee, as long as they are reasonable.
40.Where business is carried on, on behalf of the assessee's minor child (whose income is
clubbed in assessee's hands), by the assessee, which is besides assessee's own business , the
gross receipts of both should be reckoned for judging the applicability of section 44AB of the
Income-tax Act, 1961.
41. No disallowance under Section 40A(3) of the Income-tax Act, 1961 arises where an assessee
makes a cash payment exceeding Rs. 20,000 towards purchase of a capital asset.
42. Depreciation is allowed when it is claimed.
43. In the case of a dealer in shares, Income by way of dividend is taxable under the heads
"Profits and gains of business or profession".
44. An assessee owns 11 trucks. One truck is always kept as a spare vehicle and is never plied
on the road. Since only 10 vehicles are plied on the road at any given point of time, the provisions
of section 44AE of the Income Tax Act, 1961, can be availed by the assessee.
45. Municipal tax in respect of staff quarters is deductible only if it is paid, in computing
business income.
46. Advertisement in any souvenir, brochure, pamphlet or the like published by a political party is not
deductible under Section 37(2B) of the Income-tax Act, 1961.
47. Long-term capital gains arising from units of debt-oriented equity funds for which
securities transactions tax has been paid in a recognized stock exchange is exempt.
48. For computation of capital gains, full value of consideration arising from the transfer of a
capital asset, being land or building or both, shall be the value adopted by the "Stamp Valuation
Authority" for payment of stamp duty or the consideration accruing or received from the
transfer, whichever is less.
49. Surplus on sale of motor car on which depreciation has been allowed for all year by
proprietor of a business will be taxed as long term capital gain.
50. Short-term capital gains arising from sale of listed shares through a recognized stock
exchange, for which security transaction tax has been paid, will be charged to tax at a concessional
rate of 10%.

51. Benefit of carry forward and set off of accumulated losses and unabsorbed depreciation is
not available in case of amalgamation of a company owning hotel, with another company.
52. Business loss can be set off against salary income.
53. Section 73 does not permit carry forward of losses from speculation business for more than
four assessment years immediately succeeding the assessment year for which the loss was first
computed.
54. Every assessee carrying on a business or profession is entitled to deduction under section
80JJAA equal to 30% of additional wages paid to new regular workmen employed by the
assessee.
55. In the case of an individual resident in India, who is an author, maximum deduction available
from gross total income in respect of eligible royalty income is Rs. 5,00,000,
56. Market value of donation given in kind is also eligible for deduction under Section 80G of
the Income-tax Act, 1961.
57. Under Section 12A of the Income-tax Act, 1961, application for registration of charitable
trust can be made within one year form the date of creation of the trust.
58. In case of an artificial judicial person, no surcharge is payable where the total income exceeds
Rs.10,00,000.
59. Political parties governed by Section 13A of the Income-tax Act, 1961 have to file their
returns of income within the time limit prescribed under Section 139(1) even if there is no
income chargeable to tax under the Act.
60. Amount received under Keyman insurance policy is not exempt under Section 10(10D) of
the Income-tax Act, 1961.
61. Amount received under Reverse Mortgage Scheme is taxable as income under the head
'income form other sources'.
62. As per Section 194-C of the Income-tax Act, 1961, all Association of Persons and Body of
Individuals are liable to deduct tax at source from specified payments made to resident
contractors.
63. The rate of TDS applicable for payment made on 28.2.2011 to non-individual sub-
contractor, as per section 194C, is 2%.
64. Only in the TDS certificate furnished by the deductor, quoting the PAN of deductor is
compulsory and not in the other correspondences between the deductor and the deductee.
65.Partnership firm deriving loss need not file return of income.

66. For the purposes of computing minimum alternate tax (MAT) under Section 115JB(2) of the
Income-tax Act, 1961 the book profit need not to be increased, by inter alia, the amount of deferred
tax debited to the profit and loss account.
67. The period for setting off the MAT credit under Section 115JB is seven years.
68.Mr. A has received gift of Rs. 1,50,000 on 12 th December, 2013 from his close friend who is
assessed to income-tax. The same is taxable at the hands of Mr. A.
69. Gift received from assesssee's grandfather in excess of Rs. 50,000 will be taxed as income
from other sources.
70. Gift of a diamond necklace worth I 2,00,000 received from a friend by an individual
assessee is not taxable as income from other sources.
71. Mr. Janak has received as gift, gold buillion bars worth Rs. 70,000 from his friend on his
birthday on 15.3.2011. The same is not to be treated as income from other sources.
72. Mr. Saravanan follows mercantile system of accounting. On 13.3.2011, he has received
from the State Government, in respect of lands acquired, interest on enhanced compensation
of Rs.1,50,000 which includes a sum of 120,000 relatable to this year. The amount assessable is
Rs.20,000

INDIRECT TAX
MULTIPLE CHOICE QUESTIONS

(1) A manufacturer being eligible for SSI related exemptions is linked to his turnover in the
previous year
(a) Less than Rs. 400 Lakhs, (b) Less than Rs. 150 Lakhs, (c) Less than Rs. 90 Lakhs, (d) Less than
Rs. 350 Lakhs
(2) SSI Exemption scheme adopted by the manufacturer he is not required to pay central excise
duty up to
(a) Rs. 150 Lakhs on dutiable goods, (b)Rs. 300 Lakhs on dutiable goods, (c) Rs. 400 Lakhs on
dutiable goods(d) Rs. 100 Lakhs on dutiable goods
(3) Value of captive consumption goods is forming part of the Rs.400 Lakhs turnover, if the final
product
(a) Exempt in any notification, (b) Not exempt in any notification, (c) Exempt under Notification
8/2003, (d) None of the above
(4) Industries are not eligible for SSI exemption irrespective of their turnover.
(a) Automobiles, (b) Plastic, (c) Paper, (d) Electronic and Electrical
(5) The due date for filing Quarterly return ER -3 under Central Excise is
(a) 20th of the following month., (b) 10th of the following month, (c) 5th of the following month,
(d) 15th of the following month
(6)The due date for payment of Central Excise Duty by the SSI unit for the month of April is
(a) 15th of the following month, (b) 15th of October, (c) 10th of the following month, (d) 5th of the
following month
(7) Frequency of audit for SSI unit paying central excise duty is less than Rs. 10 Lakhs.
(a) Once in 2 years, (b) Once in 5 years, (c) Once in 10 years, (d) Every year.
(8) Job worker is exempt from basic excise duty if the supplier of raw material had undertaken
payment of excise duty under
(a) Notification 24/86 Central Excise Law, (b) Notification 214/86 Central Excise Law, (c)
Notification 8/2003 Central Excise Law, (d) Notification 18/2003 Central Excise Law
(9) Registration is not required if the turnover for small scale units
(a) Less than Rs. 15 0 Lakhs, (b) Less than Rs. 90 Lakhs, (c) Less than Rs. 100 Lakhs, (d) Less than Rs.
10 Lakhs
(10) What is to be done if turnover exceeds Rs 90 lakhs but is less than Rs 150 lakhs?
Declaration to be filed, (b)No Declaration to be filed, (c) Declaration may be filed, (d) Declaration
must be filed after attaining Rs. 150 Lakhs
(11) Registration is compulsory for the dealer who intends to act as

(a) First Stage Dealer, (b) Third Stage Dealer, (c) Dealer, (d) Purchaser
(12) An application for registration under central excise law is required to be made in
(a) Form A-l, (b) Form B-1, (c) Form CT-1, (d) Form ARE-1
(13) The DSA shall be preserved for

(a) Five Years, (b) Two Years, (c) One Year, (d) Six Months
(14) The excise duty payable by the manufacturer is based on

(a) Invoice, (b) Gate Pass, (c) Lorry receipt, (d) Debit Note
(15)Which one of the following is to be submitted by the manufacturer on a monthly basis

(a) ER – 1, (b) ER – 3, (c) ER – 5, (d) ER – 7
(16) Original invoice has to be issued to the

(a) Buyer, (b) Transporter, (c) Central Excise Department, (d) Consignment Agent
(17) The penalty for non-registration is

(a) Amount of duty of contravening goods or Rs 10,000 whichever is higher,
(b) Amount of duty of contravening goods or Rs 10,000 whichever is less,
(c) Amount of duty of contravening goods or Rs 1,000 whichever is higher
(d) Amount of duty of contravening goods or Rs 5,000 whichever is higher
(18) The due date of payment of tax through e-payment is

(a) 6th of the following month, (b) 5th of the following month, (c) 31st of every month, (d) 15th
of the following month

(19) LTU will be headed by

(a) Chief Commissioner of CBDT or of CBEC, b) Chief Commissioner of CBEC c) Commissioner of
Central Excise, (d) Commissioner of Income Tax.
(20)CIN stands for

(a) Challan Identification Number, (b) Cash Identification Number, (c) Commission Identification
Number, (d) Central Information Number.
(21) Desk Review audit is a part of

(a) Special Audit, (b) C & AG Audit, (c) Excise Audit 2000, (d) Investigation
(22) In the case of Excise Audit 2000, selection of assessee is based on

(a) Risk factor, (b) Non-risk factor, (c) Merit of assessee, (d) Value of goods
(23) Time period to issue notice before commencing the audit.

(a) 20 days, (b) 5 days, (c) 25 days, (d) 15 days
(24) Cenvat credit audit can be ordered by

(a) The Chief Commissioner of Central Excise, (b) The Commissioner of Central Excise, (c) The
Assistant Commissioner of Central Excise, (d) The Deputy Commissioner of Central Excise
(25) Yearly audit is applicable for those units who paid the central excise duty by way of cash
more than
(a) Rs.300 Lakhs, (b) Rs. 150 Lakhs, (c) Rs. 100 Lakhs, (d) Rs.90 Lakhs
(26) Service tax can be levied on the—

(a) Taxable services, (b) Exempted services, (c) Partly exempted and partly taxable services,
(d) On purchase of input goods
(27) Value of works contract includes—

(a) Cost of consumables, electricity, (b) Value of transfer of property in goods, (c) Value of VAT or
Sales Tax on the above, (d) None of the above
(28) A person who neither intends to hold nor holds any title to the goods or services is called
(a) Pure Agent, (b) Dealer, (c) Service tax provider, (d) Manufacturer
(29) Under Service Tax (Determination of Value) Rules, 2006, Act means
(a) The Finance Act, 1994, (b) The Central Excise Act, 1944, (c) Central Excise Tariff Act, 1985, (d)
Central Sales Tax Act, 1956
(30) Service tax is not applicable to the state of

(a) Jharkhand, (b) Himachal Pradesh, (c) Tripura, (d) Jammu and Kashmir

(31) The importer of service is liable to pay service tax only when the service provider having
(a) No place of business in India, (b) Place of business in India, (c) Permanent address in India, (d)
None of the above
(32) The service tax paid on input services claimed as Cenvat credit after the export of service
(a) Can be claimed rebate (i.e. duty drawback), (b) Cannot be claimed any rebate, (c) Can be
claimed as refund, (d) None of the above
(33) If the immovable property in respect of which service is rendered outside India the service
is considered an export
(a) Irrespective of where the payment has come from, (b) Only when payment came from
overseas., (c) Partly from overseas, (d) Even without payment received from an importer.
(34) The value of any taxable service, as the case may be, does not include
(a) The rail fare collected by rail travel agent, (b) Value of services collected by rail travel
agent, (c) Services provide by the consultant, (d) None of the above
(35) Which of the following services does not come under export of service?
(a) Air transport of passengers embarking for international travel, (b) Export of services with
respect to immovable property, (c) Export of services with respect to management
consultancy services, (d) None of the above.
(36). Service tax liability arises only when the taxable turnover of the previous year exceeds
(a) Rs. 10,00,000, (b) Rs. 9,00,000, (c) Rs. 8,00,000, (d) Rs. 7,00.000
(37). No service tax will be levied on value of goods and material supplied to the service
recipient while providing service, provided Cenvat Credit on such goods and material is
(a) not taken, (b) taken, (c) partly reversed, (d) none of the above
(38). One of the following services is a "reverse charge"

(a) Mutual Fund distributors services, (b) Management consultancy services, (c)
Telecommunication services, (d) Information Technology services
(39). Services rendered to the Reserve Bank of India is

(a) taxable service, (b) exempted service, (c) partly exempted, (d) none of the above
(40). Importer of service is liable to pay service tax only when

(a) provider of service has no place of business in India, (b) provider of service has place of
business in India, (c) import of service is not taxable in India, (d) provider of service is
related to the importer
(41). Services are taxable only when defined under

(a) Section 65(105) of Finance Act, 1994, (b) Section 64(105) of Finance Act, 1994, (c) Service
Tax Rules,(d) Section 4 of the Central Excise Act, 1944

(42). Which one of the following service is called reverse charge

(a) Service provider is liable to pay service tax, (b) Service receiver is liable to pay service
tax, (c) No one is liable to pay service tax, (d) Whose services are exempted from service tax
(43). Services provided to United Nations employees for their personal purposes is
(a) Liable to pay service tax, (b) Not liable to pay service tax, (c) Partly liable to pay service
tax, (d) None of the above
(44). A CA firm had a turnover of Rs. 17 lakhs in Yl. Its turnover was Rs. 5 lakhs in Y2, Rs. 8
lakhs in Y3 and Rs. 5 lakhs in Y4. In which years is the firm liable to pay service tax?
(a) Yl and Y2, (b) Yl, Y2andY3, (c) Y2 and Y3, (d) None of the above
(45). Exemption turnover of Rs. 10 lakhs for previous yearit is the value of taxable service
rendered and for the current year
(a) Value of taxable service received, (b) Value of taxable services rendered, (c) Value of
taxable services partly received and partly rendered, (d) None of the above.
(46). What is the due date for payments of service tax in the case of a partnership firm?
(a) 5th day of the month immediately following every month,
(b) 25th day of the month immediately, following every quarter
(c) 5th day of the month immediately following every quarter
(d) 25th day of the month immediately following every month
(47). Service tax is payable to the credit of the Central Government in:
(a) Form ST-3, (b) GAR -7 challan, (c) Form F, (d) None of the above
(48). Adjustment of excess of service tax can be allowed on the basis of

(a) Pro-rata, (b) Total amount at time, (b) Only 80%, (d) Only 50%
(49). Penalty for not maintaining the proper books of accounts may extend to
(a) Rs. 5,000, (b) Rs. 50,000, (c) Rs. 2,500, (d) Rs. 1,000
(50). An assessee is allowed to rectify mistakes and file revised return

(a) Within 90 days from the date of filing of the original return, (b) Within 180 days from
the date of filing of the original return, (c) Without any time limit, (d) None of the above
(51). E- payment of service tax is mandatory only when the payment of service tax exceeds
(a) Rs. 50 Lakhs, (b) Rs. 5 Lakhs, (c) Rs. 10 Lakhs, (d) Rs. 15 Lakhs
(52). How much abatement will be allowed to Mandap Keeper, Hotels and Convention
Services providing full catering services
(a) 40%, (b) 60%, (c) 100%, (d) 50%
(53). Cenvat credit is not allowed if the input services are exclusively used in the output
services
(a) Exempted service, (b) Export of services, (c) Taxable export of services
(54) Voluntary registration if turnover does not exceed

(a) Rs. 10,00,000, (b) Rs. 1.00,000, (c) Rs. 12,00,000, (d) Rs.50,00,000
(55) Registration is Compulsory based on transactions (irrespective of turnover) if the dealer

falls under the following categories
(a) Dealer is an importer, (b) Dealer selling goods within the state, (c) Dealer is dealing
with the exempted goods, (d) None of the above.
(56) Dealer is liable to pay tax at Special rates as specified in Schedule.

(a) Eligible to avail the VAT credit, (b) Not eligible to avail the VAT credit, (c) 50% of VAT
eligible for credit, (d) Eligible to avail the VAT credit after registered under VAT
(57) The prescribed authority may cancel the registration of a VAT dealer, where the VAT
dealer:
(a) Has no fixed place of business, (b) Has place of business, (c) Has place of residence, (d)
None of the above
(58) Compulsory registration under VAT applicable if the dealer

(a) deals with inter-state sales, (b) deals with exempted goods, (c) buying and selling
goods in the state
(d) none of the above
(59). How many Schedules are there under the VAT Act.
(a) Five Schedules, (b) Six Schedules, (c) Seven Schedules, (d) Eight Schedules
(60). Goods specified under Schedule V will be taxed at the rate of

(a) 0%, (b) 1%, (c) 4%, (d) 12.5%
(61).Under which Schedule do Bullion and Specie come?

(a) Schedule I, (b) Schedule II, (c) Schedule III, (d) Schedule IV
(62) The point of levy of tax for Aviation and other motor spirit is the point Of
(a) First sale in the State, (b) Second sale in the State, (c) First and Second sale in the State, (d)
Third sale in the State
(63) Sale of taxable goods in the course of inter-state trade or commerce falling within the
scope of section 3of the Central Sales Tax Act, 1956 are called
(a) Zero rated sales,(b) Exempted sales, (c) Non-exempted sales, (d) Taxable sales
(64) VAT rate on all kinds of Pulses and Dhalls is

(a) 1%, (b) 4%, (c) 12.5%, (d) 0%
(65) At the point of first sale in the state the following product attracts 32.55% of VAT
(a) Petrol, (b) Machinery, (c) Liquor, (d) Diesel Oil
(66)Abbreviate ITC
(a) Input Tax Code, (b) Input Tax Credit, (c) Initial Tax Credit, (d) In-house Tax Credit
(67) Sale of vegetables and fruits other than those cured, frozen, preserved, processed, dried,
dehydrated or canned are called
(a) Exempted sales, (b) Taxable sales,(c) Partly exempted sales, (d) Special sales
(68) Kerosene sold through public distribution system will attract VAT rate
(a) 0%, (b) 1%, (c) 4%, (d)12.50%
(69) Input Tax Credit (ITC) can be claimed if the inputs are used for
(a) business purpose, (b) personnel purpose, (c) distributing as free sample, (d) captive
consumption
(70) Every registered dealer must file return for each month on or before
(a) 20th of the succeeding month, (b) 10th of the succeeding month, (c) 5th of the succeeding
month, (d) End of the current month
(71) ITC can be claimed against inter-state sale only when those sales are supported by
(a) Form C,(b) Form D, (c) Form H, (d) Form I
(72) The period covered by the return is called a Tax Period and will cover a
(a) Calendar month, (b) Calendar year, (c) Half a month, (d) Six months
(73) The method under which tax is imposed at each stage of sales on the entire sale value
and the tax paid at the earlier stage is allowed as set-off is called
(a) Invoice method, (b) Subtraction method, (c) Deductive method, (d) Value addition and
deletion method
(74) Under Invoice method, tax credit can't be claimed unless and until the
(a) Tax Invoice is produced, (b) Tax amount paid, (c) Goods are delivered, (d) Actual sales take
place
(75) VAT paid at reduced rate is called

(a) Compounding Levy of tax, (b) Non-compounding levy of tax,
(c) Value added tax, (d) Sales tax
(76)Sales returns is allowed as a deduction from the taxable turnover of goods if the goods are
returned with
(a) Six months of sales, (b) Twelve months of sales, (c) Three months of sales, (d) One month of
sales

(77) Product X is taxable @ 4% and Product Y is taxable @12.5%. Product X is sold for Rs.
100,000 and Product Y for Rs. 50.000. Total input tax credit is available for Rs. 5,000. What
would be the net VAT payable?
(a) Rs. 5,250, (b) Rs. 5,000, (c) Rs. 2,500, (d) Rs. 10,250
(78) A dealer in Andhra Pradesh paid CST of Rs. 1,000 on inter-state purchases. VAT
payable by him on local sales is Rs. 1,250. The Net VAT payable is
(a) Rs. 250, (b) Rs. 1,250, (c) Rs. 1,000,(d) Rs. 750
(79) The State Governments introduce VAT in terms of the State List of the Constitution.
(a) Entry 54, (b) State legislation, (c) Entry 45, (d) Central Government
(80) If a tax is based on the selling price of a product it is called

(a) Cascading effect of tax, (b) Value added tax, (c) Rebate of tax, (d) Refund of tax
(81) The Value Added Tax (VAT) is based on the

(a) Value addition to the goods, (b) Value reduction to the goods, (c) Value avoidance to the
goods, (d) Value addition or value deletion as the case may be of the goods
(82) Who is not a VAT DEALER?

(a) Sole Proprietor, (b) Partnership firm, (c) Private Company, (d) Commission Agent
(83) What is the percentage of VAT on export sales?

(a) 0%, (b) Nil, (c) 1%, (d) 4%
(84) Output tax means taxes payable on sale of goods at the

(a) Specified rates for the commodities, (b) Specified rates for the immovable goods, (c)
Specified rates for the excisable goods,. (d) None of the above
(85) Taxable sales means sale of goods

(a) Within the State,(b) The India, (c) Outside the state, (d) Outside the slate of Jamrnu &
Kashmir
(86) VAT credit is available if purchases are from the following dealer
(a) Turnover Tax Dealer, (b) Value Added Tax Dealer, (c) Any Dealer, (d) First Stage Dealer
(87) VAT credit not available if goods are purchased from

(a) VAT dealer within state of Andhra Pradesh, (b) VAT dealer of Tamil Nadu, (c) Registered
Dealer under Central Sales Tax, (d) None of the above
(88) VAT credit will not be allowed if the goods are in the nature of
(a) Exempted goods, (b) Exported goods, (c) Deemed exports, (d) Vatable goods

(89) .Service tax was introduced in India in the year:

(A) 1993
(B) 1995
(C) 2004
(D) 1994
(90). Service tax was introduced first time on:

(A) 5 services
(B) 3 services
(C) 4 services
(D) 7 services
(91). Service tax was initially levied in India by the constitution vide entry No:
(A) 92C of the Union list
(B) 54 of the state list
(C) 92C of the concurrent list
(D) 97 of the union list
(92). The provisions relating to service tax are given in:

(A) chapter 5 of the Finance Act, 1994
(B) Chapter 5 and 5A of the finance Act, 1994
(C) Chapter 7 and 8 of the finance Act, 2004
(D) The service tax Act, 1994
(93). The power to levy service tax is now provided by the constitution vide entry No:
(A) 92C of the union list
(B) 97 of the union list
(C) 54 of the state list
(D) 93 of the union list

(99). Service tax is application to:

(A) Whole of India
(B) Whole of India except Jammu and Kashmir
(C) Whole of India, except Jammu and Kashmir and Union territories of Dadra’ Nagar Haveli,
Daman and Dai
(100). Service tax was introduced in India on the recommendation of:

(A) Kelkar committee
(B) Dr. Raja J Challiah committee
(C) Dr. Man Mohan Singh committee
(D) Dr. Yashwant Sinha committee
(101). W. e. f. 1. 7. 2012, service tax is levied in India by following the:

(A) Comprehensive approach
(B) Selective approach
(102). Service tax is governed and administered by

(A) CBDT
(B) CBEC
(103). The power to make rules for service tax is given to Central Government by
(A) Sections 66 and 67of the Finance Art, 1994
(B) Sections 94 of the finance Art, 1994
(C) Sections 94 and 96-1 of the finance Art, 1994
(D) Sections 93 and 94 of the finance Art, 1994

(104). Service tax (inclusive of cess) is payable on the value of taxable service@
(A) 10%
(B) 10.2%
(C) 10.3%
(D) 12.36%
(105). Service tax is a charge on:

(A) Taxable service provided
(B) Taxable service to be provided
(C) Taxable service provided or to be provided
(D) Any service provided or agreed to be provided other than specified in the negative list
(106). Education cess was levied by –

(A) The Finance Act, 1994
(B) The Finance No. (2) Act, 2004
(C) The Finance Act, 2006
(107). Where service is received from outside India, such serviced shall be:
(A) Taxable in hands of serviced provider
(B) Taxable in the hands of service recipient
(C) Exempt from service tax
(108). Service tax is not payable in the year of commencement of business if the aggregate
value of invoice issued of taxable service does not exceed:
(A) 8,00,000
(B) 10,00,000
(C) 4,00,000
(D) 6,00,000

(109). If the aggregate value invoice issued or required to be issued of taxable service in the
preceding financial year exceeds 10,00,000, service tax shall be payable during the current
financial year if
(A) If the aggregate value of invoice issued or required to be issued of taxable service exceed
10,00,000 during the current year .
(B) On the entire aggregate value of service.
(110). If the aggregate value of invoice issued or required to be issued of taxable service in
the preceding previous year in less than 10,00,000 service tax in the current financial year
shall be payable:
(A) On the entire aggregate value of service
(B) On the amount which is in excess of 10,00,000
(111). Service tax is note payable on any service provided to:

(A) An undertaking in a free trade zone
(B) An undertaking in a software technological park
(C) An undertaking in a special economic zone provided it is wholly consumer is SEZ
(D) A developer or unit in a special economic zone provided it is wholly consumer is SEZ
(112). Secondary and Higher Education Cess was levied by.

(A) The Finance (2) Act, 2004
(B) The Finance Act, 2006
(C) The Finance Art, 2007
(113). If a service provider commences the business of providing the service which is already
taxable, he should apply for registration
(A) Within 45 days of commencement of business
(B) Within 30 days of providing services
(C) Within 30 days of commencement of business.

(114). Application for registration is to be made in From

(A) From ST 1
(B) From ST 2
(c) From ST 3
(115). Small scale service provider who is claiming exemption of 10 lakh shall have to apply
for registration where the aggregate value of service exceeds:
(A) 10 lakh
(B) 9 lakh
(C) 8 lakh
(D) 9.50 lakh
(116). Penalty for Non-Registration is:

(A) Higher of any upto 5,000 or 100 for every day during which failure continues.
(B) Higher of any upto 5,000 or 100 for every day during which failure continues.
(C) Higher of any upto 10,000 or 100 for every day during which failure continues
(D) Higher of any upto 10,000 or 200 for every day during which failure continues
(117). Service tax Registration From is issued by the Department in From

(A) S.A.-1
(B) S.T.-2
(C) S.T.-3
(D) S.T.-4
(118). Who is authorized to cancel the Registration Certificate:
(A) Superintendent of Central Excise
(B) Assistant Commissioner of central Excise
(C) Deputy Commissioner of central Excise
(D) Commissioner of Central Excise

(119). The provision relating to valuation of taxable services are contained in:
(A) Section 65 of the Finance Art, 1994
(B) Section 67 of the Finance Art, 1994
(C) Section 65A of the Finance Art, 1999
(D) None of the above
(120). Gross amount charged for the taxable service includes:

(A) Only that amount received towards the taxable which is received before the provision of
such services.
(B) Only that amount received towards the taxable service which is received after the provision
of such service s.
(C) Any amount received towards the taxable service whether received before, during or after
provision of such serviced.
(121). Percentage of abatement allowed to service of purchase is:

(A) 70%
(B) 90%
(C) 59%
(D) 75%
(122). Percentage of abatement allowed in respect renting of a hotel is:

(A) 30%
(B) 40%
(C) 50%
(D) 60%

(123). Due date of payment of service tax in case of a company is:

(A) 5th day a of month immediately following each quarter except for the quarter ending March
(B) 5th day of month immediately following the calendar month except for the month of March
(C) 25th day of month immediately following the calendar month except for the month of March
(124). Due date of payment of service tax in case of a partnership firm is:
(A) 5th day of the month immediately following each quarter except for the quarter ending
March
(B) 5th day of the month immediately following the calendar month except for the month of
March
(C) None of the above
(125). Service tax for the month of March or quarter ending March should be deposited by:
(A) 31st March
(B) 5th April
(C) 25th April
(126). Return of service tax has to be filed:

(A) Monthly
(B) Quarterly
(C) Half- yearly
(D) Yearly
(127). Due date of filing return is

(A) 5th of the month following the particular half-year
(B) 15th of month following the particular hart-year
(C) 25th of the month following the particular hart-year
(D) 30 days of the month following the particular hart-year

(128). Return of service tax is to be filed in:

(A) Form ST-1
(B) Form ST- 3
(c) Form ST-2
(D) Form ST-4
(129). The maximum amount of Late Fee/Additional Fee3 payable for late filling of return is:
(A) 2,000
(B) 10,000
(C) 15,000
(D) 20,000
(130). Service tax return can be revised within a period of:

(A) 30 days
(B) 60 days
(C) 90 days
(D) 120 days
(131). E-filling of return is mandatory if service paid in the preceding financial year is:
(A) 5 lakh or more
(B) 8 lakh or more
(C) 10 lakh or more
(D) 20 lakh or more
(E) In all cases

Fill in the Blanks

(1) SSI exemption is available only when the turnover in the previous year turnover is
less than________________.
(2) SSI unit can clear the excisable goods upto ______________ without payment of duty.
(3) Quarterly return _______________ to be filed before the due date _______ of the
following month by the SSI units claiming the exemption notification.
(4) Payment of duty is on monthly basis and has to be made on or before _______ of the
following month.
5. No declaration needs to be given to the department if the previous year turnover is

less than____________.
6. A Job worker is exempt from basic excise duty if the supplier of raw material had undertaken
payment of excise duty under Notification ________ of Central Excise
7. SSI units will get the Cenvat Credit only over and above __________ taxable Turnover
during the current year.
8. Registration is not required for SSI units if the turnover during the previous year is
less than ___________of taxable turnover.
9. Audit of SSI units is conducted once in _______________ number of years
10. Export turnover is ______________ for the calculation of turnover under the notification
8/2003.
11.The 15 digit PAN based registration number is called ____________
12 Registration under Central Excise can be granted in the name of a minor, provided a legal
guardian undertakes to__________ ________
13. The penalty for delayed submission of return can extend upto ____
14. The term GAR means ____________
15. A LTU is an undertaking which has paid central excise or service tax of more than
___________ during the previous year.

16. The first page and the last page of the DSA shall be duly authenticated by the
or ________ person
17. LTUs will get facilities of payment of tax through ___ system.
18. Every assessee compulsorily files the annual installed capacity statement before 30th
April of the succeeding financial year in the __ Form.
19.The due date of payment of tax through e-payment is 6th of the following month by the
manufacturers and by 16th of the following month in the case of SSI units. In the case of
March month the due is________.
20.When goods are removed from the factory of the manufacturer to some other premises for
purposes of "Testing" or for "any other process not amounting to manufacture", excise duty
need not be paid provided the permission of of Central Excise is obtained.
(21) Units paying duty more than Rs 3 crore has audit __________.
(22) C & AG submits the report to the ______________ , who causes these to be laid before each
House of Parliament.
(23) Valuation Audit carried out by _______________ .
(24) The expenses of Cenvat credit audit and audit fees shall be paid by ___________ .
(25) The maximum time limit for submission of such cost audit report is ______ days from the
date of receipt of cost audit order by the manufacturer.
(26) C & AG submits the report to the _____________ , who causes these to be laid before
each House of Parliament.
(27) The audit plan should be documented in the _________ .
(28) The Cost Accountant has to submit his audit report within the time specified by
the______________.
(29) Road checks are carried out by the department authorities to check whether all goods
moving are accompanied by _____ documents or not.
(30) A minimum of ____________ notice should be given to the assessee before commencing
the audit.

(31) Stock taking can be done by the superintendent or Inspector of central excise for
______________and___________.
(32).Service Tax is a tax on _________ .
(33). Service Tax is applicable to the whole of India except the statue of ____ .
(34). Registration is mandatory if the value of taxable services exceeds Rs. ______during the
financial year.
(35). Form ________________is used for applying for registration under Service Tax.
(36). The Due date of payment of service tax for the month is ________________of the
succeeding month.
(37). The effective rate of service tax including Education Cess is ________________.
(38). Registered premises means all premises from where an assessee is

providing____________________.
(39). The present rate of service tax is___________ plus _______________plus.
(40). The Service tax provider is required to issue (within 14 days of completion of service)
an_____________ signed by him or a person authorized by him.
(41) If service tax payment is made through internet banking, such e-payment can be made
by __________of the following month or following quarter as the case may be.
(42). Service tax liability is dependent upon the type of the ____ who provides the taxable
service.
(43). Service tax can be levied on the _______ and ____________.
(44). Services provided by Central or State Government are taxable unless these services
are .
(45). If the value is not ascertainable then _____________ should be referred for arriving the
value of such services.
(46). Out of pocket expenses incurred are _______ in the value of taxable service.
(47). The expenditure or costs incurred by the service provider as a ______ of the recipient of
service shall be excluded from the value of the taxable service.
(48). Receipt of advance money is not ______ .

(49). Taxable event in the case of import is the date of ______ .
(50). Service tax is payable on ________________________ of taxable service actually

received and not on amount billed, even though taxable event arises.
(51) .The costs incurred by the service provider as a _______________ of the recipient of
service shall be excluded from the value of the taxable service.
(52). If the taxable services exceed ___________ but is less than __________ then the service
provider will have to register with the Superintendent of Central Excise under the Service
Tax provisions.
(53).For certain services service tax liability is to be paid by the service receiver is
called
__________________________________________________________________________
(54).Services provided to Special Economic Zones (or) services provided by Special Economic
Zones are________
(55).Service tax liability is exempted if the turnover is less than or equal to ____
(56). Abatement is an amount that can be __________ from the value of the service.
(57). In the case of Individuals the due date for payment of service tax for the III quarter is ____
(58). In the case of companies the service tax for October is payable on or before
of
(59). For all assessees the due date for payment of service tax for the service rendered in the
month of March is _____
(60). E-payment of service tax has been made mandatory for assessees who have paid service
tax of more than Rs. _____ during the last financial year or during the current financial year
(61). Half yearly return has to be filed using Form _______ ; The number of copies should be
_____
(62). The time limit for filing revised return is________ days from the date of _____
(63). Penalty for not obtaining registration is Rs. ______per day for every day of default
or Rs. ___________whichever is higher.
(64). The penalty will be reduced to _______ %, if tax, interest and penalty are paid within 30
days from the date of receipt of order of Central Excise Officer.

(65) .The facility of e-payment of service tax has also been introduced from _______
(66). VAT is a __________point tax and helps to remove _____ effect.
(67). There are two types of dealers_________ and __________ .

(68). Input Tax is applicable only to _____________ .
(69). Application for registration under APVAT can be made using Form No. _________ .
(70). Schedule I lists the items that are _____ from the VAT.
(71). The Input Tax Credit for VAT paid goods is not available for goods not meant for ________ .
(72). The due date for filing of Monthly VAT return is ______ in the Form __________.
(73).There are three methods for computation of VAT namely__________,

_________and___________.
(74). Input Tax Credit can be claimed against inter-state sale only when those sales are
supported by Form__________.
(75).The Department can reject the Voluntary Registration application made by dealer if he
does not have a_____________.
(76) Value Added Tax is a______________ system of taxation on sale of goods where in a
mechanism is provided to grant credit for tax paid on inputs.
(77) If a tax is based on the selling price of a product, the tax burden keeps increasing as raw
material and final product passes from one stage to another. This increase is referred to
as_________________.
(78) VAT dealer means a dealer who is registered under___________.
(79) Taxes paid on purchases from outside the state ___________are not eligible.
(80) If the taxable turnover in a period of twelve consecutive months exceeds_

_____________the dealer shall apply for registration as TOT dealer in the manner prescribed.
(81) VAT credit is allowed if both the _________as well as ___________are VAT dealers within
the state of Andhra Pradesh
(82) VAT __________the prices of commodities over period of time.
(83) VAT is also be payable on _______contract.

(84) Sales tax does not eliminate _________________effect of tax
(85) TOT dealer means a dealer whose taxable turnover exceeds Rs __________in a period of
twelve consecutive months.
Say True (T) or False(F), Give Reasons
(1) The Government of India issued Notification No. 8/2003 providing relaxation from central
excise duty, without any conditions.
(2) If in a previous year the turnover of a manufacturer is equal to Rs.4 crores then he can in
the current year claim the exemption benefits available to a SSI.
(3) SSI units opted the exemption notification benefit can pay duty if the dutiable goods cleared
from the factory exceeds Rs.150 lakhs and claim Cenvat credit on inputs.
(4) Manufacturers who have Cenvat credit (on capital goods plus on other than capital goods)
which is more than the duty payable on exempted turnover will opt for SSI exemption benefit.
(5) Clearance of excisable goods without payment of duty to 100% EOU unit will form part of
turnover to calculate the threshold limit of Rs.4 crores.
(6) Sales to Nepal and Bhutan is considered as an export sales.
(7) Export procedures are very tough for SSI units.
(8) Exempted units from central excise duty are also exempted from registration.
(9) Audit of SSI unit is conducted every year.
(10) There is no difference between method of calculation of Rs.400 Lakhs and Rs.150 Lakhs.
(11). Application for registration as a manufacturer should be made Form A-l
(12). A 5 digit PAN based registration number (ECC) will be allotted to the assessee
(13). There is no penalty for non-registration, even when registration under the statute is
compulsory.
(14). Daily Stock Account can be updated once in month.
(15). Invoice under central excise law is required to be made in triplicate.
(16). Payment of duty can be made once in six months.

(17). E-payment is mandatory for those manufactures who have paid central excise duty is Rs
50 lacs or more during the preceding financial year.
(18). If the assessee mentions CIN in the Return, it is not necessary to attach the copy of challan
with the Return.
(19). Challan Identification Number (CIN) has three parts.
(20). 100% EOU has to submit the monthly return in ER-2 Form.
(21). Excise audit is compulsory every year if the payment of excise duty is more than 3 crores.
(22). There are three types of excise audits under Central Excise Law.
(23). Desk review audit can be conducted by a practicing Chartered Accountant or a

practicing Cost Accountant in the premises of manufacturer.
(24). Valuation audit can be ordered by the Superintendent of Central Excise
(25). The expenses and audit fees shall be paid by Assessee
(26). Returns are filed by the assessee without verification by the Excise department. Hence
no audit is required to be conducted.
(27). Central Excise Revenue Audit (known as CERA Audit) conducted by the Cost Accountant or
Chartered Accountant.
(28). The desk review is a part of the internal audit procedure and the services of the
professionals are taken to help the department.
(29). Valuation Audit can be ordered only with the prior approval of Chief Commissioner of
Central Excise.
(30). The desk review audit should be completed in 5-7 working days
(31). The list of records needs to be maintained is not provided in the Service Tax Rules.
(32). Single registration in the case of multiple services rendered is possible subject to conditions.
(33). The due date for monthly return for service tax is the 25th of the succeeding month in
the case of a company.
(34). A service provider is the person who renders the service.

(35). GAR-7 is the form used to pay Service tax.
(36).Service tax records are to be maintained at the registered premises of the service provider.
(37). Any delayed payment of service tax, interest cannot be levied.
(38). Service tax paid during the previous year is in excess of Rs. 50 lakhs then e-payment is
mandatory.
(39). Single Registration is possible with the permission from Department, only when the assessee
maintains centralized billing or centralized accounting for multiple services provided from
more than one premises.
(40). If the last day of payment and filing return is a public holiday, tax should be paid and return
filed on the previous working day.
(41). If a service is rendered free service tax is not payable because the value of the service is
zero and no amount is received from the customer.
(42). There is concept of pure agent that exists for the purpose of service tax valuation.
(43).The value of goods transferred to the job worker is not included in the assessable value of
service.
(44) .Service Tax can be levied on an advance payment received.
(45).The central excise officer has the power to determine the value of the services after
providing an opportunity to be heard to the assessee.
(46). Services delivered by a person having a place of business in Jammu and Kashmir to a
person having a place of business in Andhra Pradesh is subject to service tax.
(47).Statutory services are also taxable services.
(48).Some services are taxable when provided to "any person". If a service falls in that
category, service provided on sub-contract basis will be liable to pay service tax.
(49).A person having a place of business in Andhra Pradesh provides to a person having a place
of business in Jammu and Kashmir. Such service is liable to service tax law
(50).The airfare collected by air travel agent in respect of service provided by him does not
include in the value of services.
(51).It is necessary to specify the heading under which the service being provided is falling.

(52).Service provided from India with respect to immovable property situated abroad is called
export of services.
(53).There can be no reversal of Cenvat credit on input service towards Interior decorator
services used to produce partly dutiable goods as well as non dutiable goods.
(54).There can be no reversal of Cenvat credit on input services for an output service provider
if the final services are deemed exports.
(55).Due date of payment of service tax for e-payer is the 6th of following month including the
dues for March month.
(56).Service tax will be paid by an individual on monthly basis
(57). Due date of submission of half yearly return ST-3 is 30th September
(58).Revised returns can be filed with in 90 days from the date of original return filed by the
assessee
(59).E- payment of service tax is compulsory for every assessee
(60).Provisional assessment is not applicable at any given case under service tax provisions.
(61). There are two types of registration (i) Compulsory Registration (ii) Voluntary Registration.
(62). Dealers whose Voluntary Registration always rejected by the department
(63). Dealer dealing with inter-state sales has to compulsorily register under the State VAT.
(64). Registration is also available under VAT for TOT dealers or compounding tax opted dealer.
(65). A certificate of registration under VAT is not available.
(66) .Input Tax Credit can be allowed in respect of Schedule VI goods
(67). Gold and Jeweler are liable to tax under VAT @ 1%
(68) . Goods that fall under the Schedule I will get Input Tax Credit.
(69). Generally sale of books, periodicals and journals are exempted goods under VAT.
(70). VAT rates are common for all the products specified in Schedule V

(71). The first seller of special goods in Andhra Pradesh is liable to pay. The second seller of these
goods is not liable to charge and pay tax on his sales.
(72). Liquor, at the point of first sale in the State of Andhra Pradesh, is subject to VAT @ 70%
(73). VAT rate is zero in respect of sales of goods to any unit located in the Special Economic Zone.
(74). Sugar product is listed in the First Schedule and is exempt from VAT.
(75). All intangible goods including copyright, patent, rep license, DEPB are subject to VAT @4%
(76).Taxable sales does not included Zero rated Sales
(77).Zero rates and Exempted sales are one and the same
(78).There is no such concept as Voluntary registration in VAT
(79).Schedule VI lists the items that are charged to tax at Special rates
(80).Schedule V is a residuary head. Any items that does not find a place under Schedule I, II, III
or IV canbe classified under this schedule
(81) Input Tax credit can also be availed on Capital Goods
(82)TIN means Tax Identification Number which is nothing but the Unique VAT registration
number allotted to all registered dealers
(83)Input Tax Credit can be availed for the Zero rates Sales
(84)Input Tax Credit can be availed on Inter state purchases, or goods received by
consignment sales or stock transfer to this state.
(85)The dealer passes the following entry to record utilization of Input tax paid in the
purchase of Raw
Materials
VAT Payable Account Dr.
To VAT Credit Receivable (inputs) A/c
(86) Value Added Tax is a multi Point system of taxation.
(87) VAT does not eliminate the cascading effect of tax
(88) VAT is chargeable if the sales are within the state.
(89) There are basically two categories of dealers under VAT law

(90) Taxable sales also includes Zero-Rated sales
(91) Exporter is eligible to claim VAT if sales attracts zero tax rate.
(92) VAT is attracted if works contract transactions are effected by the dealer
(93) Input tax credit is not allowed in the case of interstate purchases
(94) Input tax is applicable only to the 'purchasing' VAT dealer.

WEALTH TAX
Multiple Choice Questions
1. Person deemed to be agent for non-resident?
(a) Person who is employed in India.

(b) Person who is in receipt of any income in India.
(c) Person who has custody of any asset in India.
(d) All of the above.
2. Wealth tax is payable if the net wealth of the assessee:
a)Exceeds rs 2,50,000
b)Is rs 30,00,000 or more
c)Exceeds rs 30,00,000
3. Wealth tax is chargeable:
a)@ 2% of the net wealth exceeding rs 30 lakhs

b)@ 1% of the net wealth exceeding rs 30 lakhs
c)@ 1% of the entire net wealth provided it exceeds rs 30 lakhs
4. Net wealth of the assessee is to be computed as on:
a)31st m 31st march preceding the relevant assessment year

b)First moment of 31st March preceding the relevant assessment year
c)As on last moment of 31st March preceding the relevant assessment year

5. In case an individual is a foreign national but resident and ordinarily resident in India, the
net wealth shall:
a)Include assets wherever located whether in India or outside

b)Include assets which are located in india
c)Not including any assets
6. An individual is a citizen of India but he is resident but not ordinarily resident in India. The
net wealth in case shall include:
a)Assets wherever located

b)Assets which are located in India
c)Assets which are located in India & business assets located outside India provided that business in
set up in india.
7/ R gifted rs 3,00,000 to his wife on 5.11.2009 mrs. R purchased gold out of this money. The
market value of the gold on 31.3.2014 is rs 6,00,000. The market value of gold on 31.3 2010
was rs 3,20,000. The amount to be included in net wealth of R for assessment year 2014-15
shall be:
a) Rs 3,00,000
b) Rs 3,20,000
c) Rs 6,00,000
d) none
8. R gifted gold ornaments to his wife on 5.11.2010. The market value of gold on that date was
rs 5,20,000. Mrs R sold the gold and invested the sale proceeds in share whose market value
on 31.3.2014 was rs 6,10,000. The amount to be included in the net wealth of R shall be:
a)Rs 5,20,000
b)Rs 6,10,000
c) Nil
9. Asset held by a minor child is included to the net wealth of:
a)Father
b)Mother
c)Father or mother whose net wealth before such clubbing is greater
10. A plot of land shall be exempt under section 5(vi) if the size of the plot:
a)Is less than 500 sq. Meters

b)Does not exceed 500 sq. Meters
c)Does not exceeds 500 sq. Yards
11. One house shall be exempt u/s 5(vi) in case of:
a)Individual assessee only

b)Any assessee
c)Individual or H.U.F.

12. The annual rental value of a house determined by the municipal authority is rs 1,20,000
whereas its annual rent received/receivable is rs 1,50,000. The municipal taxes of the house
property is rs 20,000 out of which rs 15,000 has been paid during the previous year 2013-14.
The N. M.R of the house property in this case shall be:
a) Rs 1,30,000
b) Rs 1,07,500
c) Rs1,12,500
d) Rs 1,10,500
13. A freehold house property was acquired by the assessee for rs 10,00,000 in 1981 which
was constructed in 1972. The N.M.R of the property as on 31.3.2014 is 60000rs.The
capitalized value will be:
a)Rs 7,50,000
b)Rs 10,00,000
c)Rs 6,00,000
14. Specified area shall be ______ of total area in metro cities?
(a) 60%
(b) 65%
(c) 70%
(d) None
15. If difference between un-built and specified area is 15% adjustment to be made will be ?
(a) 20% of capitalized value

(b) 30% of capitalized value
(c) 40% of capitalized value
(d) Nil
16. Mr. A has let out the HP for 15000 PM. Municipal taxes paid by tenant 20000 pa and
deposit received 50000 interest free actual rent will be ?
(a) 207500
(b) 200000
(c) 180000
(d) Nil
17. What will be GMR if municipal value is Rs. 200000?
(a) 207500
(b) 200000
(c) 180000
(d) Nil
18. GMR of the HP is 300000, Municipal taxes levied Rs. 20000 (Half paid by tenant) NMR of
the HP will be ?
(a) 235000
(b) 280000
(c) 255000
(d) Nil

19. What will be the capitalized value if HP is situated on lease hold land the balance lease
period is 55 years?
(a) 2350000
(b) 1880000
(c) None
20. Value of HP as per rule 20 of schedule III is determine in case if :
(a) Un-expired lease period is 15 years or less

(b) Difference between un-built and specified area is more than 20%
(c) all the above
21. Valuation of asset used for business is determine as per ______ of schedule III?
(a) Rule 14
(b) Rule 3 to Rule 8
(c) Rule 16
(d) Rule 18 & 19
22. Value of HP as per rule 14 will be, if ?

Book value : 50 lacs
Sch. III : 40 lacs
WDV : 30 lacs
(a) 40 lacs
(b) 36 lacs
(c) 30 lacs
(d) 50 lacs
23.Value of Jewellery as per rule 14 will be, if ?

Book Value : 40 lacs
Schedule III : 45 lacs
(a) 40 lacs
(b) 45 lacs
(c) 48 lacs
(d) None
24. Value of motor car as per rule 14, will be if :

Book value : 10 lacs
WDV : 5 lacs
Schedule III : 6 lacs
(a) 5 lacs
(b) 6 lacs
(c) 10 lacs
(d) None

25.. Rule 16, shall apply in case of determination ?
(a) Interest in the Firm or AOP

(b) Interest in the HUF
(c) Interest in the firm or Company
(d) None of above.
26. Net wealth of the firm is divided in the ratio :
(a) Upto capital in capital ratio and balance in dissolution ratio.

(b) Whole in capital ratio
(c) Whole in dissolution ratio
(d) None of above
27. Net wealth of ABC firm is 80 lacs, capital of firm is A: 20 lacs, B 20 lacs, C 10 lacs
dissolution ratio : 3:2:1? Determine value of interest of each partner in firm?
(a) 35/30/15
(b) 40/20/20
(c) 30/30/20
(d) None
28. Reference to valuation officer is made u/s 16A in case if assessing officer is of the opinion
that FMV of the asset exceed by ______ of declared value?
(a) 33 1/3% of the value or 50000 w.e.h

(b) 33 1/3% of the value or 50000 w.e.l
(c) None
29. Person who is liable to file the wealth tax return u/s?
(a) Whose net wealth exceed the limit of 30 lacs

(b) Whose net wealth not exceed the limit
(c) Even if exceed or not
(d) Not required
30. Mr. A head of the HUF, transferred a HP to his HUF purchased out of the HUF a/c shall be
taxable ?
(a) HUF
(b) Mr. A
(c) Not taxable
(d) None
31.. What will be your answer, if the said HP is purchased out of personal a/c of Mr. A.
(a) HUF
(b) Mr. A
(c) Not taxable
(d) None

32. What will be your answer if the said HP is let out by HUF for residential purpose for the
whole year?
(a) HUF
(b) Mr. A
(c) Not taxable
(d) None
33. Mr. A has transferred a HP on lease for 12 years to Mr. B shall be taxable ?
(a) In the hands of Mr. A

(b) In the hands of Mr. B
(c) Not taxable
(d) None
34. What will be your answer if lease period is 11 years?

(c) Not taxable
(d) None
35.What will be your answer if period is 14 years?

(c) Not taxable
(d) None
36. What will be your answer if period is 10 years and extension of 15 months allowed for 4
times.?

(c) Not taxable
(d) None
37. What will be your answer if extension is 10 months?

(c) Not taxable
(d) None
38. List of circumstances in which transfer is considered as revocable transfer?
(a) If transfer provides a right to re-transfer whole or any part of asset.

(b) If transfer deed provides a right to retransfer whole or any part of income from such asset.
(c) If the transferor derives any benefit directly or indirectly from asset transferred.
(d) All the above.

39. Mr. A has agreed to purchase a HP from Mr. B and paid certain consideration in advance
and gets the possession of HP, decide the taxability?
(a) Mr. A
(b) Mr. B
(c) Not taxable
(d) None
40. What will be your answer if possession is not transferred?\
(a) Mr. A
(b) Mr. B
(c) Not taxable
(d) None
41.. What will be your, in case instead of HP jewelery is transferred?
(a) Mr. A
(b) Mr. B
(c) Not taxable
(d) None
42. Mr. A owner of HP in Jaipur used for charitable purpose decide the taxability ?
(a) Taxable
(b) Exempt
(c) None
43. What will be your answer if the charity is made in USA?
(a) Taxable
(b) Exempt
(c) None
44. Maharaja Jai Singh has a palace for his own residence and he also owned a HP, he
claimed exemption for one place and also demand exemption for his HP as one house or
Plot? Decide?
(a) Whether allowed

(b) Whether disallowed
(c) None
45. Mr. Ram, Indian citizen returns to India on permanent basis as on 1st Jan, 14. He has
purchased a HP on 1st March, 13 out of money send from abroad. Decide taxability as on
valuation date march, 14.
(a) Taxable
(b) Exempt
(c) None

46. What will be your answer if the said HP was purchased on 1st March, 12?
(a) Taxable
(b) Exempt
(c) None
47. What will be your answer if the HP was purchased on 1st March, 13 but money was
transferred on 1st march, 12?
(a) Taxable
(b) Exempt
(c) None
48. Exemption to Indian repatriate is available for :
(a) 7 years following the returns

(b) 5 years following the returns.
(c) 6 years following the returns.
(d) None
49. Account eligible for exemption to Indian repatriate ?
(a) NRE A/c

(b) NRO a/c
(c) NRI a/c
(d) None
50.. Determine the net wealth of Mr. A if he has HP : 30 lacs, Jewellery 40 lacs, Motor car 20
lacsLoan for HP 10 lacs
(a) 60 lacs
(b) 90 lacs
(c) 80 lacs
(d) None
51. What will be your answer if instead of Mr. A it is A Ltd?
(a) 60 lacs
(b) 90 lacs
(c) 80 lacs
(d) None
52. Determine the net wealth of Mr. B, Indian citizen if he has :

HP (India) 50 lacs
Motor car (India) : 30 ;lacs
Jewellery (USA) 20 lacs
Loan for motor car (USA) 5 lacs
Jewellery (India) 5 lacs
(a) 40 lacs
(b) 25 lacs
(c) 90 lacs
(d) None

53. What will be your answer if Mr. B is a foreign citizen?
(a) 40 lacs
(b) 25 lacs
(c) 90 lac
(d) None
54. Determine the net wealth of Mr. Ram, if he has :

HP (Gifted by his wife) 30 lacs
Jewellery 40 lacs
Motor car 20 lacs
(a) 60 lacs
(b) 90 lacs
(c) 50 lacs
(d) No
55. Determine the net wealth of A Ltd if details are :

Factory building 60 lacs
Jewellery 30 lacs
Motor car for business Use 30 lacs:
(a) 30 lacs
(b) 120 lacs
(c) 90 lacs
(d) None
56. Interest @ 15% PA on deposit is allowed if the amount of deposit is :
(a) More than 3 months rent

(b) Less than 3 months rent
(c) 3 months or more
(d) None.
57. Adjustment for repairs expenses is made ?
(a) 1/9 of rent received.

(b) 1/9 of repair expenses
(c) None
58. Mr. A received deposit of 50000 from tenant and paid 2000 as interest to tenant. Determine
the taxable amount?
(a) 7500
(b) 5500
(c) 2000
(d) Nil

59. GMR for the let out property is ?
(a) Municipal value

(b) Annual rent
(c) Fair rent
(d) Municipal value or annual rent (W.E.H.)
60. What will be your answer if HP is for self occupied purpose?
(a) Municipal value

(b) Annual rent
(c) Fair rent
(d) Municipal value or annual rent (W.E.H.)
61. If the HP is situated on free hold land capitalized value will be ?
a) NMR x 8 times
(b) NMR x 10 times
(c) NMR x 12.5 times
(d) None
62. Wealth escaping assessment u/s 17 is made when?
(a) Assessee not filed the return, although having wealth exceeding 3000000.
(b) Return is funished but assessee has understated the wealth.
(c) Assessee is found to have asset outside India.
(d) All of the above
63. Time limit for assessment u/s 17 will be ______ was served ?
(a) Within 12 months

(b) Within 24 months
(c) Within 36 months
(d) None.
64. Rate of substitution shall apply in case if HP is purchased ?
(a) After 31st March, 1974

(b) Before 31st March, 1974
(c) None
65. Value of HP shall be determine as per rule 20 of schedule III? If unexpired lease period is
?
(a) More than 50 years.

(b) Less than 50 years
(c) Less than or equal to 15 years
(d) None
66.. Wealth tax is introduced in India?
(a) 1st April 957

(b) 1st April, 1956
(c) 1st April, 2005

67. Wealth tax is applied?
(a) Whole of India

(b) Whole of India exempt J&K
(c) Some part of India
(d) None
68. Valuation date for the A.Y. 2014-15.
(a) 31st March, 2013

(b) 31st March, 2014
(c) 31st March, 2015
(d) None
69.. Person who is liable for wealth tax ?
(a) RBI
(b) Social club
(c) Co-operative society
(d) Individual
70. Asset under wealth tax act, 1957 define under :
(a) u/s 2 (ea)

(b) u/s 4
(c) u/s 5
(d) None
71.. Any residential house allotted by the company to its whole time employee shall not be an
asset u/s 2(ea), if :
(a) Annual salary in more than 1000000

(b) Gross annual salary is 1000000
(c) Gross annual salary is less than 1000000
(d) Net annual salary is less than 1000000
72. Any residential house let out for _______ shall not be an asset u/s 2 (ea).
(a) more than 300 days

(b) Less than 300 days
(c) Not less than 300 days
(d) None
73.. Any commercial house let out for shall be an asset u/s 2 (ea)
(a) More than 300 days

(b) Less than 300 days
(c) Not less than 300 days
(d) All the above.

74. Mr. A is the owner of the factory and the let out the same for the whole year, decide
whether it is :
(a) An asset
(b) Not an asset
(c) None
75. Mr. B is the owner of BMW used for his personal purpose whether it is:
(a) An asset
(b) Not an asset
(c) None
76. A Ltd has the business of Tours & Travel owned 10 motor car, whether :
(a) An asset
(b) Not an asset
(c) None
77. Indian airlines has 50 airplanes for business purpose whether

:
(a) An asset
(b) Not an asset
(c) None
78.. Mr. A has the business of jewellery and have some jewellery at his home for his use,
whether :
(a) An asset
(b) Not an asset
(c) None
79. Mr. B has the jewellery business and beforethe valuation date he introduce his personal
jewellery in his business whether :
(a) An asset
(b) Not an asset
(c) None
80. Silver made furniture held for sale, whether :
(a) An asset
(b) Not an asset
(c) None
81. Furniture made of costly wood, whether :
(a) An asset
(b) Not an asset
(c) None

82. Painting framed in a golden frame whether :
(a) An asset
(b) Not an asset
(c) None
83. A plot in Jaipur city having population of 60,00,000 whether :
(a) An asset
(b) Not an asset
(c) None
84. Plot situated outside the municipality of ajmer having population of 5,00,000 shall be
asset if :
(a) within 2 kms

(b) within 6 kms
(c) within 8 kms
(d) none
85. Farm house situated outside the municipality of beawer having population of 4,00,000
shall be asset if :
(a) within 2 kms

(b) within 6 kms
(c) within 8 kms
(d) all of the above
86. Plot purchased for the purpose of sale, shall be exempt for :
(a) 10 years
(b) 15 years
(c) 5 year
(d) None
87. Plot purchased on 1st Jan, 2013 for industrial purpose shall be ______ as on valuation
date 31st March, 2014
(a) An asset
(b) Not an asset
(c) None
88. A plot purchased for agriculture purpose is used for industrial purpose shall be _____ as
on valuation date :
(a) An asset
(b) Not an asset
(c) None

89. MR. A has a physical cash balance of 80000 is _____ as on valuation date :
(a) Fully exempt

(b) Fully taxable
(c) Excess of 50000 taxable
(d) None
90. A ltd has 60000 recorded in cash book is :
(a) Fully exempt

(b) Fully taxable
(c) Taxable, in Excess of 50000
(d) None
91. Mr. A has 40000 of cash in hand and 80000 in bank is :
(a) Fully exempt

(b) Fully taxable
(c) Taxable, in Excess of 50000
(d) None
92. Mr. Ram has 80000 of cash at home, on 31st March he deposited 30000 in bank decide it is
:
(a) Fully exempt

(b) Fully taxable
(c) None
93. Mr. A has gifted jewellery to Mrs. A out of love and affection, decide the taxability :

(b)In the hands of Mrs. A
(c) None
94. What will be your answer if the jewellery was transferred for consideration.

(c) None
95. what will be your answer if the jewellery was sold and a motor car is purchased?

(c) None
96. what will be your answer in case, instead of motor car, shares were purchased?

(c) None

97. What will be your answer, instead of jewellery shares were transferred?

(c) None
98. Asset held by the minor shall be taxable in the hands of parents.
(a) If the net wealth of parents is more than 30 lacs.

(b) If the net wealth of parents is less than 30 lacs
(c) Even if net wealth exceed or not
99. Mr. Ram gifted jewellery to his minor son, it shall be taxable as on valuation date ?
(a) In the hands of Mr. Ram

(b) In the hands of Minor
(c) In the hands of parents on the basis of net wealth
(d) None
100. Minor has purchased a land out of the money received as a prize money, such land is
taxable in the hands of :
(a) Parents
(b) Minor
(c) None
101. Minor has purchased a HP out of the prize money and let out the same and purchased a
motor car out of the rental income, such motor car is taxable :
(a) In the hands of parents, as per wealth.

(b) Minor
(c) Not taxable
(d) None
.
102. Minor, is gifted a jewellery by his grandfather. Gross wealth of his father 90 lacs (debt is
20 lacs)and of his mother 80 lacs (debt nil) determine the taxability ?
(a) His father

(b) His mother
(c) Minor
(d) None
103. Form for wealth tax return is ______?
(a) Form BA
(b) Form 3CB
(c) Form 49A
(d) Form ST-1

104. Due date for filing wealth tax return in case of individual?
(a) 31.07.2014
(b) 30.09.2014
(c) 31.03.2014
(d) None
105. Time limit for belated return is ?
(a) One year from the end of A.Y.

(b) Before the end of the A.Y
(c) on or before 31.07.2014
(d) none
106. Self Assessment is define u/s ______?
(a) 15B
(b) 16
(c) 16 (3)
(d) None
107. Self assessment means ?
(a) Assessment of tax liability by assessee.

(b) Assessment of tax liability by Assessing officer
(c) None
108. Scrutiny assessment u/s 16(3) is made when?
(a) Assessee understated the net wealth

(b) Assessee underpaid the Tax
(c) All the above.
109. Notice for scrutiny assessment is to be served?
(a) Within 12 months from the end of the month when return is furnished.
(b) Within 24 months
(c) With 36 months
(d) None
110. Best Judgment assessment u/s 16(5) is made, if ?
(a) Any person fails to file return u/s 14.

(b) Any person fails to comply with the notice for scrutiny assessment.
(c) Any person fails to comply all the term of notice to furnish return
(d) All the above

Fill in the blanks

1. Partial partition of HUF is _________ (recognized/not recognized) for purpose of Wealth-
tax Act, 1957.
2. Where L whose cash and bank balance on 14.01.2013 is Rs. 50,000 gifts Rs. 2,50,000 to M,
without any actual delivery of the money, Rs.________will be clubbed in the hands of L for
wealth-tax purposes.
3. Under the Wealth-tax Act, 'assessment year' means the period of ____commencing on 1st
day of April every year, falling immediately after the ________
4. The term 'net wealth' is defined in Section ______of the Wealth Tax Act.
5. As per Section 2(ea)(i) Wealth-tax Act, 1957,"asset" means, inter alia, farm house situated
within ______Kilometers of any municipality.
6. Deemed individual is _______(liable to tax/not liable to tax) under Section 2(22)(e) of the
Income-tax Act, 1961.
7. The term "asset" is defined in clause ___of Section 2 of the Wealth-Tax Act, 1957.
8. In the case of an individual or a HUF, a plot of land not exceeding ______ in area is exempt
under Section 5(vi) of the Wealth-tax Act, 1957.
9. In computing the net wealth of an individual, the value of assets, which on the valuation
date, are held by a minor child who is a married daughter of such individual,
_________(shall/shall not) be included.

True and False/Correct and Incorrect

1. Property held by an assessee under trust for any private purposes of charitable nature in India
is not an exempt asset under Section 5 of the Wealth-tax Act.
2. A charitable trust whose income is not exempt under any clause of Section 10 of the Income-
tax Act, 1960 will be chargeable to wealth-tax in all cases, where the trust forfeits exemption.
3. The term 'individual', as a defied in the Wealth-tax, 1957 means only a single human being.
4. The term 'Individual' as defined in Wealth tax Act, 1957 means only a single human being.
5. Under the Wealth Act, 1957 a person who is once treated as a citizen of India, continues to be
treated as a citizen of India for ever.
6. Is it correct to state that every member of AOP is an assessee for the purpose of wealth tax?
7. A political party is exempt from paying wealth tax.
8. The maximum amount of penalty leviable under Section 18(1)(c) of the Wealth-tax Act, 1957
for concealing the particulars of any asset chargeable-tax is five times the amount of tax sought
to be evaded.
9. An individual himself has to sign the return of wealth and whatever be the contingency, cannot
authorize another persons to sign on his behalf.
10. A company owns a plot of urban land comprising of area of 500 square metres. Exemption is
not available in respect of this asset under the provision to Section 5(vi) of the Wealth Tax Act,
1957.
11. Vacant side held as stock-in-trade is not liable for wealth tax for 12 years from the end of the
year in which it was acquired.

DON’T COPY, RESPECT EFFORT BEHIND THIS.
For Solutions Part & Other Related Notes Contact & Like our Page
Taxation & Law CODES
https://www.facebook.com/pages/Taxation-Law-CODES/185533964799625



Taxation Law Codes Presents Cs Executive Tax Laws - 59cd7a9a1723dda4f28dee1e PDF

Загружено:

Сведения о документе

Оригинальное название

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

Taxation Law Codes Presents Cs Executive Tax Laws - 59cd7a9a1723dda4f28dee1e PDF

Загружено:

Авторское право:

Доступные форматы

JMD TAXATION & LAW CODE Page |0

For CA, CS & OTHER PROFESSIONAL 2014

TAXATION & LAW CODE’S

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

PREFACE TO MY FIRST EDITION

DON’T COPY, RESPECT EFFORT BEHIND THIS.

@ Copyright: KETAN SARDANA;ketanhsardana@gmail.com

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

This Book is dedicated to LORD GANESHA

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

Multiple Choice Questions

2. Following is not a capital receipt:

(a) Dividend on investment;

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

6. Expenditure incurred by an employer on medical treatment and stayabroad of the employee

9. The following is not taxable as income under the head "Salaries":-

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

13. Expenditure incurred in carrying out illegal business is—

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

16. Deduction for bad debts is allowed to an assessee carrying on business —

(a) If the rate of interest does not exceed 8% p.a.

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

(a) not exempt under Section 10(37);

(a) to be added to the cost of acquisition;

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

(a) Rs. 50,000

(a) Rs. 4,900;(c)Rs. 4,500;

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

(a) deductible in full;

(a) Rs.100crores,(c) Rs. 10crores,

(a) Generation of power

42. Surcharge of 2.5% is payable in the case of companies, by

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

46.The following is not an asset as envisaged by Sec.2(ea) of the Wealth-tax Act.

48. Additional surcharge (education cess) of 3% per cent is payable on

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

58. A.O.P should consist of :

59. Body of individual should consist of:

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

66. A local authority is taxable at flat rate of income-tax.

67. A co-operative society is taxable at flat rate of 30% on TI.

68. Education cess is leviable @:

69. Education cess is leviable in case of:

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

72. Income tax is rounded off to:

73. A’s TI for the A.Yr.2014-15 is Rs.12,00,000.His tax liability shall be

74. Residential status to be determined for :

76. Income deemed to accrue or arise in India is taxable in case of :

79. TI of a person is determined on the basis of his:

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

85. An Indian company is always resident in India

86. Dividend paid by an Indian company is:

87. Agricultural income is exempt provided the:

89. Agricultural income is :

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

103. Salary, bonus, commission or remuneration due to or received by a working partner

105. Interest on capital or loan received by a partner from a firm is:

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;

a) Five years immediately before the commencement of business

112. Preliminary expenses incurred are allowed deduction in:

116. Expenditure incurred on family planning amongst the employees is allowed to

@ Copyright: KETAN SARDANA; ketanhsardana@gmail.com ;