Dr.M.

Ramila, Assistant Professor of Commerce, Gurunak College of Arts and Science, Chennai,
Mobile No. 9566164481
Unit – XIX & XX Income Tax TRB MCQ
1. Any profit or gain arising from transfer of a capital assets effected in the previous year is
to be chargeable to tax under the head?
a) Salary
b) House Property
c) Business or Profession
d) Capital Gain
2. According to which section the term capital gain is defined?
a) Section 25
b) Section 35
c) Section 45
d) Section 55
3. According to Sec 2 (14) capital assets include
a) Any rights in relation to an Indian Company
b) Property of any kind
c) Security held by foreign institutional investor (SEBI Act)
d) All the above
4. Which of the assets are excluded from the definition of Capital assets?
a) Stock in trade held for business or profession
b) Assets held for personal use
c) Rural Agriculture land (population 10,000 or more)
d) All the above
5. Short term capital assets means
a) Non-Financial capital asset held by an assessee for more than 36 months
b) Non-Financial capital asset held by an assessee for not more than 36 months
c) Non-Financial capital asset held by an assessee for more than 24 months
d) Both (a) and (b)
6. Which does not called as Long term capital assets?
a) Financial assets held for more than 12 months
b) Unlisted shares of a company held for a period of more than 24 months
c) Immovable property held for more than 24 months
d) None of the above
7. Any gain on transfer of an assets on which depreciation is allowed as per WDV method
shall be treated as
a) Short-term capital gain
b) Period of holding
c) Long-term capital gain
d) Both (a) and (c)
8. Which transaction does not considered as transfer
a) Conversion of capital assets in to stock-in-trade
b) Maturity or redemption of a Zero Coupon
c) Transfer in a scheme for lending of any securities
d) Transfer or rights in immovable properties through companies
9. The amount for which a capital asset is transferred is called as
a) Cost of improvement
b) Full value of consideration
c) Cost of acquisition
d) All the above
 Dr.M. Ramila, Assistant Professor of Commerce, Gurunak College of Arts and Science, Chennai,
Mobile No. 9566164481

10. The transfer of one or more undertaking of the sale for a lump sum consideration without
values being assigned to the assets and liabilities is
a) Full consideration
b) Slump sale
c) Lump sale
d) Both (a) and (b)
11. Any long term capital assets sold and amount invested in purchases of specified bonds,
such transaction considered to claim exemption under
a) Section 54 D
b) Section 54EC
c) Section 54 F
d) Section 54B
12. Land and building, plant and machinery and their right for shifting industry sold and
amount invested in purchase or construction of new assets plus deposits in CGDS can claim
exemption under
a) Section 54 EC
b) Section 54 F
c) Section 54 G
d) Section 54 GA
13. Suresh purchases a house property on July 9, 2016 for Rs. 8,00,000 and incurred an
additional cost of Rs. 6,00,000 for improvement on 1.10.2017. Fair market value of the
property on July 9, 2016 is Rs. 5,00,000. Determine the cost of the asset, if it is to be sold
on May 15, 2018
a) 5,00,000
b) 8,00,000
c) 12,00,000
d) 14,00,000
14. Mr. Dharun is a film producer, during the year 2018-19 he sold a film projector for Rs.
1,70,000. Which had cost him Rs. 1,50,000 and in respect of which Rs. 40,000 had been
allowed as depreciation. Expenses on sales amounts to Rs. 5,000. Compute the capital gain.
a) STCG 45,000
b) LTCG 45,000
c) STCG 55,000
d) LTCG 55,000
15. Mr. Ram purchased a house on 1.11.2004 for Rs. 2,00,000 and it was improved in 2012-13
at a cost of Rs. 1,00,000. What will be indexed cost during 2018-19 if CII for 2004-05 is
113; for 2012-13 is 200 and for 2018-19 is 280
a) Rs. 3,35,575
b) Rs. 4,35,575
c) Rs. 5,35,575
d) Rs. 6,35,575
16. Maximum limit for claiming deduction under section 80 DDB is
a) Rs. 40,000
b) Rs. 50,000
c) Rs. 80,000
d) Rs. 1,00,000
 Dr.M. Ramila, Assistant Professor of Commerce, Gurunak College of Arts and Science, Chennai,
Mobile No. 9566164481
17. The maximum limit of deduction under section 80EE on interest on loan borrowed for
purchase of residential house property is Rs. 50,000. This deduction can claim only if
a) The maximum limit for self-acquired property is Rs. 2,00,000
b) The amount of loan sanctioned does not exceed Rs. 35 Lakhs
c) The value of residential house property does not exceed Rs. 50 Lakhs
d) All the above
18. Which item is listed under 100% donations under section 80G
a) Promoting Minority Community
b) Indira Gandhi Memorial Trust
c) National Fund for Control of Drug Abuse
d) Approved Charitable Institution for Charitable Purpose
19. The Donation given by any person to political parties can claim deductions under
a) Section 80GG
b) Section 80 GGA
c) Section 80 GGB
d) Section 80 GGC
20. Section 80 IB deals with deduction of
a) Profits from industrial undertaking or ship or hotel
b) Profits from infrastructure undertaking
c) Setting up industrial undertaking in special states
d) Profits and gains of bio-waste
21. The assessee can claim deduction for interest on saving account under section 80TTA up
to the maximum of
a) Rs. 10,000
b) Rs. 20,000
c) Rs. 30,000
d) Rs. 40,000
22. Any industrial undertaking which creates new jobs can claim deduction under section 80
JJA up to
a) 10% of additional wages
b) 20% of additional wages
c) 30% of additional wages
d) 40% of additional wages
23. The assessee can claim deduction for investment made under an equity saving scheme only
if the conditions are satisfied
a) Gross total income should not exceed Rs. 12,00,000
b) Investment is locked for a period of 2 years from the date of acquisition
c) Deduction is allowed for 2 consecutive A.Y.
d) All the above
24. The maximum limit for senior citizen under section 80D is
a) Rs. 25,000
b) Rs. 30,000
c) Rs. 45,000
d) Rs. 50,000
25. Interest on loan taken for higher education can be allowed as deduction only for?
a) 6 years
b) 7 years
c) 8 years
 Dr.M. Ramila, Assistant Professor of Commerce, Gurunak College of Arts and Science, Chennai,
Mobile No. 9566164481
d) 9 years
26. The assessee can claim deduction under section 80 DDB up to the limit of ?
a) Rs. 10,000
b) Rs. 20,000
c) Rs. 30,000
d) Rs. 40,000
27. If donations are made to any approved temples, mosques, church, gurudwara or any other
place of national importance for repairs/innovations it will come under?
a) 100% donation
b) 50% donation
c) Restricted category
d) All the above
28. Adjusted gross total income means
a) Gross Total Income (-) Long Term Capital Gain, Short Term Capital Gain on
sale of listed shares and deduction u/s 80 C to 80 U except 80G
b) Gross Total Income (-) Long Term Capital Gain, Short Term Capital Gain on sale
of unlisted shares and deduction u/s 80 C to 80 U except 80D
c) Gross Total Income (-) Long Term Capital Gain, Short Term Capital Gain on sale
of unlisted shares and deduction u/s 80 C to 80 U except 80G
d) Gross Total Income (-) Long Term Capital Gain, Short Term Capital Gain on sale
of listed shares and deduction u/s 80 C to 80 U except 80D
29. The assessee can claim deduction for profits from industrial undertaking or ship or hotel of
a) 100% of profits for first 5 years
b) 25% of profits for next 5 years
c) 30% of profits for next 5 years
d) Based on year of set up of the unit
30. The assessee can claim deduction for royalty income for developing patents under
a) Section 80QQB
b) Section 80RRB
c) Section 80TTA
d) Section 80 TTB
31. Deduction from GTI in respect of certain payments is available under
a) Section 80 C to 80 U
b) Section 80 C to 80 GGC
c) Section 80 C to 80 TTA
d) Section 90 C to 80 TTB
32. Which of the following is not to be included to compute gross qualifying amount for section
80C?
a) Contribution to PPF
b) Subscription to NSS
c) Payment of life insurance premium
d) Payment of school fees of a poor neighbour’s children
33. Maximum deduction u/s 80DD shall be
a) Rs. 10,000
b) Rs. 50,000
c) Rs. 65,000
d) Rs. 75,000/Rs. 1,25,000
 Dr.M. Ramila, Assistant Professor of Commerce, Gurunak College of Arts and Science, Chennai,
Mobile No. 9566164481
34. Deduction u/s 80DDB is in respect of
a) Maintenance of handicapped dependent
b) Treatment of specified diseases
c) Contribution to pension fund
d) Contribution to RPF
35. Deduction u/s 80E is in respect of
a) Repayment of loan taken for higher education
b) Interest on loan taken for higher education
c) Investment in NSS
d) Premium paid to LIC
36. Income tax act deals with authorities under
a) Section 141
b) Section 114
c) Section 161
d) Section 116
37. Central Board of Revenue Act constituted at
a) 1936
b) 1963
c) 1937
d) 1973
38. Class II category of Income tax officers are appointed by
a) Central Government
b) Director
c) Commissioner of Income Tax
d) Inspector of Income Tax
39. Due dates for filing of return, other than company (required to audit cases) is
a) 31st July of the assessment year
b) 31st March of the assessment year
c) 30th November of the assessment year
d) 30th September of the assessment year
40. If evaluation or estimation in the context income tax law of income of the assessee by
considering all relevant material by the assessing officer is called as
a) Self-assessment
b) Scrutiny assessment
c) Best Judgement assessment
d) Precautionary assessment
41. If assessment are made to protect the interest of the revenue, then it is known as
a) Self-assessment
b) Scrutiny assessment
c) Best Judgement assessment
d) Precautionary assessment
42. If income tax return filed after the due date is called as
a) Revised return
b) Belated return
c) Defective return
d) Voluntary return
43. If income exceeds the maximum amount which is not chargeable to tax then
a) Revised return to be filed
 Dr.M. Ramila, Assistant Professor of Commerce, Gurunak College of Arts and Science, Chennai,
Mobile No. 9566164481
b) Belated return to be filed
c) Defective return to be filed
d) Voluntary return to be filed
44. The act of using legal methods to minimize tax liability is known as
a) Tax planning
b) Tax avoidance
c) Tax evasion
d) Both (b) and (c)
45. If planning is made in order to avail all exemptions, deductions and rebates provided in act
is
a) Permissive planning
b) Tax planning
c) Purposive planning
d) All the above
46. Wealth tax act is abolished in the Union Budget presented by Union Finance Minister Arun
Jaitley on
a) 28th February 2014
b) 28th February 2015
c) 28th February 2016
d) 28th February 2017
47. The maximum limit for interest paid on loan for purchase of electric vehicle is
a) Rs. 1,50,000
b) Rs. 2,00,000
c) Rs. 2,50,000
d) Rs. 3,50,000
48. Wealth tax was replaced with an additional surcharge to the superrich with a taxable income
of over 1 crore annually
a) 10%
b) 15%
c) 2%
d) Both (a) and (b)
49. The Government announced that if the assessee withdraw the cash exceeding Rs. 1 crore
in a year from a bank account, then TDS of _____ is charged
a) 2%
b) 3%
c) 4%
d) 5%
50. For quick closure of service tax and excise related litigations, the Government announced
a) Sabaka Vishwas Legacy Dispute Resolution Scheme
b) Sahara Vishwas Legacy Dispute Resolution Scheme
c) Sabaka Vishwa Legacy Dispute Solution Scheme
d) Sahara Vishwa Legacy Dispute Solution Scheme