9.60 Income Tax Law and Practice Year of acquisition 2010-11 2018-19 CLI 167 280 She made investment in residential house for ir 16,00,000 taxable capital gain. C.1.1 2023-24 : 348 [Ans: LTCG Before Exemption Ag. Land & Building € 3,60,294; LTCG After Exer OBJECTIVE TYPE QUESTIONS et is an asset held for not mg ‘ Choose the Correct Answer 1. A short term capital asset except financial ass a) 12 months b) 24 months 0)” 36 months d) 48 months 2. Financial asset is called as short term asset if it is held for not more than ~ 312 months b) 24 months c) 36 months d) 48 months 3. A long term cap! a) 12 months b) 24 months me 36 months d) 48 months 4. Financial asset is called as long term asset if it is held for more than ital asset except financial asset is an asset held for more d p 12 months b) 24 months c) 36 months d) 48 months 5. Capital gain is classified into types. we Two b) Three c) Four d) Fivesrock in trade index for the Previous Year 2021-22 is sold a residential house and made investment in residenti assessee An laim exemption? section he can c! uf Sec. 54 b) Sec. 54D «) Sec. 54F d) Sec. 54G . An assessee sold long term capital asset except residential house and n residential house, he can claim exemption u/s a) Sec. 54 b) Sec. 54D ©) Sec. 54F 4) Cost price as on 1.4.2001 ») Market price as on 1.4.2001 ©) Actual cost : \AF Fair market price on the date of conversion9.62 Income Tax Law and Practice 12. E: ion u/s 54 is available if sale of assets is Long term only b) Short term only ¢) Either short term or long term d) None of the above 13. When a partner transfer his capital asset to firm, the sale consideration is a) Fair market value ‘ef Amount recorded in firms books ¢) Original cost to the partner d) Indexed cost plus transfer expenses 14. When a firm/AOP transfer its capital asset by way of distribution on its dis sale consideration is Fair market value b) Amount recorded in books c) Agreed value d) Indexed cost plus transfer expenses 15. If an assessee made investment in residential house, he can claim exemption under a) Sec. 54 b) Sec. 54F ~oF Either a or b d) None of the above 16. If bonus shares were allotted before 01.04.2001, its cost of acquisition is wa Fair market value on 01.04.2001 b) Cost of original shares c) Fair market value on the date of allotment d) Zero 17. If bonus shares were allotted after 01.04.2001, its cost a) Fair market value on 01.04.2001 b) Cost of original shares c) Fair market value on the date of allotment “Sf Zero 18. The cost of acquisition of the right shares is a) Fair market value on 01.04.2001 b) Cost of original shares ©) Fair market value on the date of allotment Of Zero of acquisition isee! Bes I 9. 39. The cost Income from Capital Gains 9.63 e capital gain arises on transfer of right shares will be long term capital gain will be short term capital gain will be a short term capital gain be short term or long term capital gain of acquisition of the self generated capital assets is a) Fair market value on 01.04.2001 p) Fair market value on the date of transfer ¢) Indexed fair market value of 01.04.2001 7 Zero g) may Answers ceri? 31s Answer c a c a a d d a d [a | QnNo's | | 12 | 13 | 14 | 5 16 [| 17 | 18 | 20 | Answer | © a b a c a d d [a | Say whether True or False 1. Capital gain arises on transfer of depreciable asset shall always be a short term capital gain. 2. Indexation benefit can be claimed on depreciable assets. . When a firm transfer its assets on dissolution to partner, the agi reed value is irrelevant. While calculating capital gain on transfer by way of compulsory acquisition, legal expenditure to recover claim shall not be allowed as deduction. At the time of liquidation of company any transfer by way of distribution of assets to its, shareholders is not treated as transfer. s shares allotted after 01,04.2001 is its fair market value on 6. Cost of acquisition of bonu: 01.04.2001. Answers True 1 3 5 False 2 4 6 Match the Following 4 1) Jewellery a) Long-term capital asset 2) Building held for 24 months b) Personal effects 3) Wearing apparel ki c) Income from other sources 4) Tenancy rights ‘ d) Capital assets 5) Advance money forfeited e) Self generated assets11.14 Income Tax Law and Practice 10. Mr. Natesh submits the following information for the year ending March 31, 1. Son of Natesh (date of birth: Sep. 30, 2005) has fixed deposit of % 10,00,009 ;, (rate of interest 6%) 2. Minor daughter of Natesh owns a business. For the previous year ending 31,2024, her income from business is € (-) 45,000. : 3. On Jan. 1,.2019 Natesh gifted = 3,00,000 to Mrs.Natesh. This amount own funds) is used in setting up a sole proprietary business by Mrs.Natesh, On 1, 2023, her total investment in the business is 9,00,000 and for the year ending March 31, 2024 income from the business is € 4,50,000. 4 4. Salary income of Natesh is 7 12,00,000 5. Mr. Natesh is entitled for a deduction of € 40,000 under section 80CCC, 6. Income of Mrs. Natesh for the previous year 2023-24 is = 2,00,000. 7. Interest on F.D ( deposit made by grandfather) received by his son Rs.30,000 Determine the net income of Mr.Natesh for the previous year 2023-24. [Ans: GTI & 12,93,500] OBJECTIVE TYPE QUESTIONS Choose the Correct Answer 1. In which of the following case is clubbing of income possible? a) Transfer of income without transfer of assets b) Income of spouse c) Revocable transfer of assets we All of the above 2. Income of a minor child is included in the total income of a) Transferor of asset b) Father M1 Parent whose income is greater d) None of the above 3. Which of the following sections of the Income Tax Act deal with the clubbing of incomes?” a) Sec. 40 to 45 a b)- Sec. 50 to 55 oS Sec. 60 to 65 d) Sec. 70 to 75Clubbing of: In : is ! om Comes and Aggregation of Incomes 11.15 y ’ When minor’s income clubbed with Parent's j 4 income, i ig F 4) 1,000 per child tion can be claimed up Ye % 1,500 per child : : ’ a # ¢) % 2,500 per child My d) % 3,000 per child Of In computing the total income of an asses i : ae . see; i 3 pS included in his total income? beget the following incomes shall a) Unexplained investment J on Aig b) Unexplained money 1 c) Unexplained expenditure a o . : \W Alll of the above : 3 Fei 7 a : [Q. Nos 1 2 3 as: CT [Answers d c a Say whether True or False 1. Spouse means husband or wife who are lawfully wedded. 2. Ifeither of the spouse dies, the income which accrues or arises after the death can be clubbed. : 3. The income which is to be clubbed with the income of the seer yyil be included under the same head of income in which the other person has computed. Answers aa |) Income of mi i - a) Deemed income E inor child A Tie e Unexplained Investment - db) a a rofe Income from interest on capital from firm - ¢) Sec. 60 to Sec. 65 4, Clubbing of income ~ €) Contain: previa ete . Exempted up to © 1,500 * Revocable transfer 9) es :a. House property Desulatve business loss can be set off b. Speculative business “Business d. Income from any other heads 2. Loss from speculation business can be set off against income fro \z’ Speculative business b. Non-speculative business, c. Business 4. Any head of income 4. Short term Capital loss can be set off against | Short term capital gain b. Long term Capital gain Ye Any capital gain 4. Any head of income 4 Long term Capital loss can be set off against 4. Short term Capital gain Long term capital gain © Any Capital gain ; @ Any head of income Loss j ‘Deurred from activity of owning and maintaining race horses fra Period of12.50 Income Tax Law and Practice 6. Loss from activity of owning and maintaining race horses can be set off against a. Income from other sources US ncome from the same activity ¢. Income from any other head d. Income from any other head except salary 7. Brought forward loss from house Property can be set off against “Income from house Property b. Income from business ‘ie ¢. Income from any head 4. Income from any head except Salary 8. Business loss can be set off against a. Income from business b. Income from any head v4 Income from any head except Salary d. Income from salary 9. Which of the following can be set off against winning from lotteries, ci a. Loss from other sources b. Loss from house property c. Loss under any head \ No loss can be set off 10. Unabsorbed depreciation can be carried forward for set off for a period of a. 4 Years b. 8 Years c. 12 Years \d/ infinite period 11, Loss from agriculture can be set off against a, business income b. income from other sources ¢. any income , no income 12. Loss from house Property can be set off a; a. %1,00,000 Tossword puzzles? gainst any other heads up to f 7 2,00,000 ¢. %3,00,000 d. No limitSy whether True or False 1. No loss can be set-off against agricultural income. 2 Loss from specified business can be. set off against 4. Lone term canital gain can be set off against any ©; furnished the following Particulars progath ; ae jigible de he duction u/s 80GG. Income from salary (Net) Income from other sources Contribution to RPF Premium of medi claim policy Rent paid for a house at Coimbatore From the following information ascertain eligible deductions { Morte PY 2023-24. LIC premium paid (Sum assured % 3,00,000 Policy On 20.02.2019) Deposit in PPF Repayment of housing loan to SBI Payment of LIC pension fund b Interest paid on loan is taken for the higher education Medical insurance premia paid by cheque for parents not dependent on assessee {Ans: Deduction 80C and 80CCC: Rs.1,50,000, OBJECTIVE TYPE QUESTIONS Choose the Correct Answer ce 1 Premium paid for life insurance is allowed for deduction u/s § 410% of sum assured 3 515% of sum assured 920% of sum assured 5% of sum assured tribution to the SPF or RPF is eligible for ded individual13.38 Income Tax Law and Practice 3. Payment of tuition fees is eligible for deduction u/s 80C for a) Only one child \byTwo children c) Three children d) Any number of children 4. To claim deduction u/s 80C, fixed deposit in a scheduled bank should be for a Period of a) Not less than 2 years b) Not less than 3 years C) Not less than 4 years Not less than 5 years 5. Expenses on the medical treatment of severely disabled dependent for deduction up to a) = 20,000 b) & 40,000 c) & 60,000 Sd) & 1,05 000 Person can be claimed Deduction in respect of medical treatment of a specified disease is allowed to the maximum of. a) = 10,000 b) % 20,000 of = 40,000 d) % 80,000 Deduction in respect of higher education loan is allowed in respect of say Interest only b) Principal only c) Penal interest d) All of the above 8. Mr. A has paid % 10,000 as premium for medi claim policy of his family members preventive health checkup. How much he can c laim u/s 80D? ~ay¥¥ 5,000 b) = 10,000 c) % 25,000 d) % 50,000eit for deduction u/s 80C is pene 50,000 9 €2,004000 es se a which of the following donation is eligible at 100% for deductio . E pM’s Drought Relief Fund 4p Indira Gandhi Memorial Trust «Rajiv Gandhi Foundation br National Cultural Fund 1, Deduction u/s80C is available yrOnly to individual p) To individual and HUF ¢) To individual, HUF and Firm d) To all assessee i. For Deduction u/s 80D, family does not include a) Dependent children é Independent children c) Dependent parent @ Independent parent Answers QNo’s| 1 / 2/3] 4 5 é |Answers} a | a | bl a| a e ae i Miether True or False ~ Tuition fees paid is eligible if it is for the purpose of full time or Medi claim premium paid in cash is eligible for deduction w/s 801 eon a Tees of medical treatment of @ dependent di — ok peru expenditure. Oe ‘on in kind is also eligible for deduction u/s 80G._ ao deduction allowed under Sec. 80CCC is & _ insurance premium paid is allowed ws 80D, if t Fr oe u/s 80D, health check up pay ment *her-in-law ad poe —_ —me from business Jno ne from house property (computed) Inco" = from long-term apital gain pein from lottery 6 : me from interest on SB account ue 100 ibution made towards PPE Donation to the National Defence Fund [TI RTR Rs.20,65,000, ATR Rs.22,85,000, ' Tax P the following particulars of Ms. Gowri, who is working i administrative Officer, ascertain her total income and ge 7023-24 under both regular tax regime and alterna tive tax regime. ) Basic Rs.1,50,000 p.m. D.A Rs.80,000 p.m. (Not enter into service benefits) Bonus Rs.1,20,000 p.a. : bi She contributes 14% of salary towards RPF. Her employer also She is provided with a small car for office and personal use: employer including driver salary. Special allowance @ Rs.5,000 p.m. Entertainment allowance @ Rs.3000 p.m. OBJECTIVE TYPE QUESTIONS + Choose the Correct Answer 1" An individual male assessee’s (aged 50) tax liability will be nil, ge NOt exceed for the P.Y, 2023-24 under alt 4) Rs.1,00,000 ») Rs.1,50,000 ®) Rs.2,50,000 Rs.3,00,000 x ‘0g, Surcharge is chargeable on individual assessee, ith E a) Rs.10,00,000 7 5 Rs.25,00,00014.32 Income TaxLaw and Practice \ofs.50,00,000 4), Rs.1,00,00,000 - 3, 15% surcharge is chargeable on individual assesses if hi a) Rs.10,00,000 b) Rs.25,00,000 Rs.50,00,000 fra 1.00.00.000 - ge 4, Percentage of Health and education cess for the P.Y 2023-24 a) 1% bv) 2% ) 3% wis % 5. Exemption limit for the P.Y 2023-24 in case of super senior individuals is under regular tax regime. a) Rs.1,50,000 b) Rs.2,50,000 ) Rs.3,00,000 @ Rs.5,00,000 6. Rebate u/s 87A can be claimed by Resident Individuals whose total income under regular tax regime a) Does not exceed Rs.3,50,000 UF Does not exceed Rs.5,00,000 c) Does not exceed Rs.2,50,000 d) Does not exceed Rs.2,00,000 7. Health and education cess is calculated on “ s/her income exceeds a) Total income b) Taxable income Tax on total income d) Agricultural income 8. Under Alternate Minimum Tax, tax credit can be carried forward for a) Four assessment years b) Eight assessment years ) Ten assessment years Fifteen assessment yearste Minimum Tax is calculated on — Gross Total Income Income » Aajusted Total Income o Taxable Income stands for 4) Applicable Minimum Tax : eaenble Minimum Tax ‘alternate Minimum Tax 0 ‘Allowed Minimum Tax answers Q. No’s 1 Answers | 4 ¢ Match the Following _ Maximum rebate u/s 87A |. Relief applicable . Rebate available for total income . Tax exemption for individual (57 age) . Tax exemption for individual (65 age) Answers. Q. No’s 1 2 3 4 (ose Match with |e | a0) b | seujuadal REVIEW QUESTIONS Knowledge) and K2 (Understand) Level q Suate the rebate u/s 87 A. 5 4 Explain relief u/s 89 pmo where higher education cess is charged. {Quote where surcharge is charged * Expain &ross total income. : is senior citizen for income tax P'