Top 250+ Solved Direct Taxation MCQ Questions Answer
Q. Expenditure on promotion of family planning is an allowance as deduction u/s. 36(1)(ix) of the Income Tax Act, 1961 in case of
a. Individual
b. Firm
c. HUF
d. Company
Q. Deduction u/s 35AD is available in respect of expenditure on specified business, one of them is:
a. Setting up and operating a cold chain facility
b. Setting up and operating a power plant
c. Setting up and operating an industrial unit
d. All of the above
Q. Deduction u/s 35AD is available in respect of expenditure on specified business provided such business commenced its operation on or after 01-04-2009 subject to an exception that:
a. Business of industrial undertaking may be commenced at any time on or after 01-04- 2007
b. Business of laying and operating a cross-country natural gas pipeline network may be commenced at any time on or after 01-04-2007
c. Business of cold chain facility may be commenced at any time on or after 01-04- 2007
d. All of the above
Q. In case of loss, a partnership firm may claim deduction in respect of remuneration topartner to the extent of:
a. Rs. 1,50,000/-
b. Rs. ,50,000/- or remuneration paid, whichever is lower
c. Rs. 1,50,000/- or 90% of book profit, whichever is lower
d. Nil
Q. Block of asset is required to be increased by an amount which is actual cost of the assetbeing covered u/s 35AD that amount is:
a. Actual expenditure
b. Nil
c. 50% of actual expenditure
d. None of the above.
Q. A payment of Rs. 25,000 is made to the road transport-operator on 20-02-2018 in cash,consequently, amount disallowed u/s 40A(3) is
a. Nil
b. Rs. 25,000
c. Rs. 5,000
d. None of the above
Q. U/s 54, capital gain will be allowed as exemption if the house property under transfer isheld for
a. Less than 12 months preceding the date of transfer
b. More than 12 months preceding the date of transfer
c. Less than 36 months preceding the date of transfer
d. More than 24 months preceding the date of transfer
Q. Capital gain on Slump sale is
a. always short-term capital gain
b. always long-term capital gain
c. Depends on period of holding of capital asset being undertaking transferred
d. Not taxable
Q. While computing capital gain on sale of immovable property, full value of consideration shall be:
a. Actual consideration
b. Actual consideration less expenses on transfer
c. Actual consideration or stamp duty value of the property transferred, whichever is higher
d. Stamp Value of the property transferre
Q. Cost of acquisition of capital asset being immovable property acquired through gift covered u/s 49(4) is:
a. Actual cost of acquisition to the previous owner
b. Nil
c. Stamp duty value of the property as considered while computing income u/s 56(2)
d. Actual cost of acquisition to the assessee.
Q. Long term capital gain on sale of equity share through stock exchange
a. is exempt u/s 10(38)
b. is exempt u/s 10(37)
c. is covered u/s 111A, hence liable to tax @ 15%
d. is taxable @ 20% and @ 10% if index benefit is not claime
Q. Caution money forfeited by the assessee is:
a. Taxable in the year of forfeiture under the head “Income from Other Sources”
b. Exempt fully
c. Taxable in the year of forfeiture under the head “Capital Gain”
d. Considered as casual income and liable to tax @ 30%.
Q. Gift of a capital asset is not considered as transfer, however exception is:
a. Shares acquired under the Employees Stock Option Plan
b. Jewellery
c. Immovable property
d. Nil
Q. Cost of acquisition of self-generated asset is nil, the exception is:
a. Goodwill
b. Route permit
c. Bonus shares acquired before 01-04-2001
d. Loom hours
Q. Interest on delayed compensation or enhanced compensation is taxable:
a. On accrual basis
b. On receipt basis
c. Exempt from tax
d. As per method of accounting of the assessee.