Q.No.

Question 1 2 Which is the objective of Tax Management Financial year is

Option 1 To reduce the tax liability to the minimum Beginning from April 1 of current year and ends on March 31 of next year

Option 2

To comply with the provisions of Tax laws Same as Previous Year

The following are Indian companies

An Institution declared by the board A company established under an act to be a company under section 2(17) passed by parliament

Income which accrue or arise outside India and also received outside India taxable in case of
X ltd, a foreign company manages its affairs partly from India and partly outside India. X Ltd is said to be Minimum alternative Tax is applicable in the following cases Extra Tax which a company has to pay because of Minimum alternate tax, can be carried forward for A company owning the following hotels can claim deduction under section 80-ID A person getting bonus shares will have to pay tax at the time of allotment of bonus shares A company will pay dividend tax if

resident only
Resident in India Limited Liability Partnership 5 Years A 5 star hotel in Jaipur On the market value of the bonus shares Bonus shares are allotted to equity shareholders

not ordinarily resident

Non Resident in India Partnership Firm 7 Years A 4 star hotel in Gurgaon On the face value of the bonus shares Bonus shares are allotted to preference shareholders Corporate tax rate and depreciation rate

5 6 7 8 9 10

11

A company want to purchase a plant (cost Rs. 80 crores). It can outrightly purchase it. Alternatively it can take the plant on lease. Corporate tax rate Which of the following factor is considered to find out the better option. Following are Incomes exempted from Tax Receipts from HUF

12

Leave salary of Central Government Employee

13

Interest on Capital or Loan received by a partner from the firm is

Exempt U/S 10(2A)

Taxable U/H Business & Profession

14

Unabsorbed Depreciation which could not be set off in the same assessment can be carried 4 years forward for Following conditions are required for charge There should be a business or of profits and gains of Business in general Profession Salary, Bonus, commisions or renumerations due to or received by a working partners from Income from Salary the firm is taxable under the head Tax Audit is Compulsory in case of a person carrying on Business whose gross 10 lakhs turnover/sales/receipts, as the case may be, exceeds Education cess is leviable in case of Residential status to be determined for Income which accrue outside India from a business controlled from India is taxable in case of Agricultural income is exempt provided the An Individual and HUF Previous year Resident only Land is situated in India

8 years The Business or Profession should be carried on by the assessee

15

16

Income From Capital Gains

17

40 lakhs A company (established under an act passed by parliament) asessee Assessment year Not ordinarily resident only Land is situated in any rural area India Profit and gains from Business and Profession

18 19 20 21

22

R, a chartered accountant is employed with R Ltd., as an internal auditor and requests the employer to call the remuneration as internal Income from salary audit fee. R shall be chargeable to tax for such fee under the head A is entitled to children education allowance @ Rs. 80 p.m. per child for 3 children Rs.200 p.m. amounting Rs.240 p.m. It will be exempt to the extent of Perquisite received by the assessee during the Salary course of carrying on his business or profession is taxable under the head

23

Rs.160 p.m.

24

Other Sources

25

26 27 28 29 30 31

Under the head Business or Profession, the method of accounting which an assessee can Mercantile system only follow shall be Where the entire block of the depreciable asset is transferred after 36 months, there will Short-term capital gain be Exemption under section 54 is available to All assesses Deduction u/s 80C in respect of LIP, Any assessee Contribution to provident fund, etc. is allowed to Deduction under section 80C is allowed from Gross total income Deduction under section 80D in respect of medical insurance premium is allowed to: The quantum of deduction allowed under section 80D shall be limited to Any assessee Rs.20,000

Cash system only

Long-term capital gain Individuals only An individual Total income An individual or HUF Rs.10,000 Non corporate assesees subject to tax audit under section 44AB

32

Advance tax has to be paid in the following cases electronically through internetbanking All corporate assesees facility offered by authorised banks

33 34 35

For an employee in receipt of hostel expenditure allowance for his three Rs.10, 800 children, the maximum annual allowance exempt under section 10(14) is Individual only AOP Should consist of
Body of individual should consist of Individual only A new business was set up on15-11-2008 and it commenced its business from 1-122008.The first previous year in this case shall 15-11-2008 to 31-3-2009 be:

Rs.7,200 Person other than individual only Person other than individual only

36

1-12-2008 to 31-3-2009

37 38 39 40

A person leaves India permanently on 1511-2008.The assessment year for income 2007-08 earned till 15-11-2008 in this case shall be Income tax is rounded off to Nearest ten rupees Taxable Income of a person is determined Residential status in india on the basis of his Taxable in India in the hands of Dividend paid by an Indian company is the recipient

2008-09 Nearest one rupee

Citizenship in India

Exempt in the hands of recipient

Option 3 Both of the above Both of the above

Option 4 None of the above None of the above

Correct Option 2 1

Section

Both of the above

None of the above

both ordinarily resident and NOR None of the above

Resident and ordinarily resident Co-operative Society 10 years A 3 star hotel in Mumbai Resident but not ordinarily resident All of the above No Carry Forward All of the above

2 4 3 1 2 4

On the value determined by the boardOn nothing Bonus shares are allotted to debenture None of the above holders, free of cost Corporate tax rate, depreciation rate, lease rent, cost of capital and useful None of the above life of plant

Both of the above

None of the above Taxable U/H Business & Profession on Account of Interest on Capital and Income from Other Sources on account of Loan to the firm None of the above

Taxable U/H Income From Other Sources

Indefinitely

The Business or Profession should be carried on for some time during the All of the above previous year Income from Business & Profession Income from Other Sources

1 Crores

None of the above

All assesee Accounting year Both ordinarily resident and Not ordinarily Resident Land is situated whether in India or outside India.

None of the above None of the above Non-resident None of the above

3 1 3 1

Income from other sources.

None of the above

Rs. 240 p.m

Rs.80 p.m

Profit and gains of Business and Profession

None of the above

Mercantile or cash system only

Hybrid system

Short-term capital gain or loss Individual + HUF An individual of HUF Tax on total income

Long-term capital gain or loss None of the above An individual or HUF who is resident in India None of the above

4 3 3 1 2 3

Individual or HUF who is resident in Individual only India Rs. 15,000 Rs. 5,000

Both of the above

None of the above

Rs.9,600 Both of the above Both of the above

Rs.3,600 None of the above None of the above

2 3 1

2008-2009

1-4-2008 to 15-11-2008

2009-10 No rounding off of tax is done

Both of the above

None of the above

None of the above None of the above

2 1 1 2

Taxable in the hands of the company and exempt in the hands None of the above