Basic Concepts & Definitions MCQs:

Basic Concepts & Definitions

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Q 1: Income tax is a

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Q 2: For the purpose of levying tax on income other than agricultural income, Union List contained entry

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Q3: Income-tax Act, 1961 applies to:

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Q4: Finance Bill becomes the Finance Act when it is passed by:

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Q5: Circulars issued by CBDT are binding on:

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Q6: Income Tax Act came into force on ……

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Q7: The highest Administrative Authority for Income Tax in India is

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Q8: The basic source of income-tax law is

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Q9: Income Tax is imposed on a person by

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Q10: Which of the following statements is incorrect?

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Q11: Income Tax Act 1961 is a milestone because

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Q12: _________ is empowered to levy and collect income tax

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Q13: Income tax is a ……………..

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Q14: The term assessee has been defined under section:

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Q15: Assesses is always a person but a person may or may not be an assessee.

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Q16: A person may not have assessable income but may still be assessee.

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Q17: Association of persons can include:

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Q18: A person includes:

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Q19: Every assessee is a person, and

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Q20: Describe the status of the following person (i.e. individual, HUF, Firm, Company etc.) Mr. S and Ms U are legal heirs of Mr. J. Mr. J died in 2018. After his death Mr. S and Ms U carry on his business without entering into a partnership.

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Q21: Association of persons consists of:

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Q22: Body of individuals consists of:

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Q23: According to Section 2(7) of Income Tax Act Assesses means

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Q24: The term Person includes

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Q25: Assesses is always a person but a person may or may not be an assesses.

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Q26: A person may not have assessable income but may still be assesses

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Q27: Who is Tax payer?

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Q28: As per Section 2(31), the following is not included in the definition of person—

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Q29: A municipal corporation legally entitled to manage and control a municipal fund is chargeable to income-tax in the status of:

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Q30: -----------------------------is not a head of income

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Q31: If total income of a person is Rs. 2,67,888.34, it shall be rounded off to

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Q32: Cash gift received from a non-relative is regarded as income. However, exempt amount is:

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Q33: The total income of the assessee shall be rounded off in the multiples of:

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Q34: Mr. J has won a sporting event at the international event. His sponsors have awarded him `10 Lakhs. This amount should not be taxable for him since this is not the income which accrues on the day to day basis

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Q35: Mr. J has taken a loan of `5,00,000 from HDFC bank for purchasing a car. His rental income is `50,000 pm out of which `5,000 pm directly goes to the bank as an instalment of loan.

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Q36: The total income of the assessee has been computed at `3,83,494.90. After rounding off, Total Income will be taken as:

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Q37: Income tax liability is rounded off to:

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Q38: How many heads of income are there to compute Gross total income?

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Q39: The amount of taxable income is to be rounded off to the nearest multiple of `1 for income tax calculations

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Q40: Any receipt in the nature of windfall gains is known as casual income

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Q41: The term Income includes the following types

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Q42: Which of the following income is not included in the term income under the Income-Tax Act, 1961:

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Q43: AB & Co. received `2,00,000 as compensation from CD & Co. for premature termination of contract of agency. Amount so received is

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Q44: According to section 2(24) definition of income is

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Q45: Which of the following is not included in taxable income

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Q46: Income under section 2(24) includes – (i) The profits and gains of business carried on by any person. (ii) Any advance money forfeited in the course of negotiations for transfer of capital asset., Choose the correct option with reference to the above statements

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Q47: Choose the correct alternative: Financial Year 2020 -2021 shall be considered as –

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Q48: Previous Year is defined

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Q49: Assessment Year is the period of 12 month commencing on 1st day of:

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Q50: In some cases, assessment year and previous year can be same financial year.

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Q51: Mr. J sets up a new business on 15/7/2020 and he commenced his business from 1/2/2021. The first Previous Year in this case shall be:

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Q52: Mr. J. maintains his accounts of the basis of calendar year under the Companies Act, 2013. For the PY 2020-2021 his AY under the Income Tax Act, 1961 shall be:

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Q53: Pick the correct one:

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Q54: If the master of the ship belonging to a non-resident could not file return of income before the departure of ship from India then it can be filed after the ship has left India but within:

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Q55: In the case of shipping business of a non-resident deemed income is:

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Q56: Under section 176 it is compulsory for the assessing officer to assess the income of the assessee in the same year in which the business has been discontinued.

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Q57: Income of a non-resident from the shipping business from India shall be taxable at:

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Q58: Assessment year can be a period of:

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Q59: Year in which income is taxable is known as……………………...and year in which income is earned is known as ……………………….

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Q60: All assessees are required to follow:

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Q61: First previous year in case of a business/ profession newly set up on 31/3/2021 would:

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Q62: A person follows Calendar year for accounting. For taxation, he has to follow:

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Q63: In which of the following cases, income of PY is assessable in the PY itself:

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Q64. In which of the following cases, Assessing Officer has the discretion to assess the income of previous year in previous year itself or in the subsequent assessment year:

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Q65: An Individual leaves India permanently on 15/11/2020. The AY for incomes earned till 15/11/2020 shall be:

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Q66: Previous Year can be a period of:

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Q67: In some cases assessment year and previous year can be same financial

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Q68: Previous year always starts from the month of _______.

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Q69: The year in which the income is earned is known as

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Q70: A new business was set-up on 1/7/2020 and trading activity was commenced from 1/9/2020, the PY would be the period commencing from: