R4RIN – MCQs, Mock Tests | CBES Board Class 11 CS Executive Tax Laws MCQs Set-8

Biren discontinued wholesale trade in medicines from 1st July 2017. He recovered ₹ 1,50,000 in October 2020 being a bad debt that was written-off and allowed in the assessment year 20182019. He has eligibly brought forward business loss of wholesale trade in medicines of ₹ 1,70,000. The consequence of bad debt recovery is that

1. It is chargeable to tax
2. It is eligible for set-off against brought forward business loss
3. The brought forward business loss is taxable now
4. 50% of the amount recovered now is taxable

✅ Correct Answer: 2

Unabsorbed loss from house property can be carried forward for

1. 4 years
2. 8 years
3. Indefinite period
4. Cannot be carried forward

✅ Correct Answer: 2

Loss from speculation business is eligible for carrying forward for a period of

1. 4 Years
2. 6 Years
3. 8 Years
4. 12 Years

✅ Correct Answer: 1

No loss can be set off against

1. Income from salaries
2. Income from house property
3. Income from capital gains
4. Winnings from lotteries

✅ Correct Answer: 4

The amount of depreciation not absorbed in the same year can be carried forward

1. For a period of 4 years
2. For a period of 8 years
3. For a period of 6 years
4. Indefinitely

✅ Correct Answer: 4

Loss from speculation business can be set off against

1. Income from salaries
2. Income from house property
3. Income from speculation business only
4. Any head of income

✅ Correct Answer: 3

Mr. Shahu has lost from house property of ₹ 1,10,000 (computed) for the assessment year 2021-22. He can carry forward such loss for subsequent assessment years.

1. 4
2. Nil
3. 8
4. Indefinite

✅ Correct Answer: 3

Mr. Hussey for the previous year has: (i) Business loss of ₹ 1,30,000; (ii) Income from salary ₹ 2,40,000; and (iii) Speculation gain of ₹ 1,10,000. His total income for income tax assessment is:

1. ₹ 3,50,000
2. ₹ 2,20,000
3. ₹ 2,40,000
4. ₹ 1,10,000

✅ Correct Answer: 3

Mathur Storage (P) Ltd. engaged in chain cold storage has brought forward business loss of ₹ 12 lakhs relating to the assessment year 2020-2021. During the previous year2020-2021, its income from the said business is ₹ 9 lakhs. It also has profited from trade in food grains of ₹ 6 lakhs. The total income of the company for the assessment year 2020-2021 is:

1. ₹ 15 lakhs
2. ₹ 6 lakhs
3. ₹ 9 lakhs
4. ₹ 3 lakhs

✅ Correct Answer: 2

A Co. Ltd. has business loss and unabsorbed depreciation of ₹ 10 Crore. B Co. Ltd is a profit-making company. B Co. Ltd. wanted to acquire A Co. Ltd. with the benefit of set-off of brought forward loss and unabsorbed depreciation. The legally permissible method is:

1. Reverse merger
2. Outright purchase
3. Slump sale of A Co. Ltd.
4. Converting A Co. Ltd. into a subsidiary of B. Co. Ltd.

✅ Correct Answer: 2

When an assessee has lost from house property, it is eligible for carrying forward for the subsequent assessment years.

1. 2
2. 4
3. 6
4. 8

✅ Correct Answer: 4

Mr. Siddharth is employed in a company. His income under various heads are (i) Salary ₹ 5,60,000; (ii) Loss from letting out properly ₹ 65,000; (iii) Loss from business ₹ 1,10,000 and (iv) Loss under the head other sourc-es ₹ 30,000. His total income after set off of losses would be:

1. ₹ 3,55,000
2. ₹ 4,65,000
3. ₹ 4,20,000
4. ₹ 5,30,000

✅ Correct Answer: 2

A company has the following: (i) Current scientific research ex-penditure; (ii) Current depreciation; (iii) Unabsorbed depreciation; (iv) Brought forward business loss. The order sequence of set off is:

1. (i), (it), (Hi), (iv)
2. (iv), (iii), (i), (ii)
3. (i), (ii), (iv), (iii)
4. (iv), (ii), (i), (iii)

✅ Correct Answer: 3

Speculation loss can be carried forward for subsequent assessment years.

1. 8
2. Nil
3. 4
4. 6

✅ Correct Answer: 3

In which case a partnership firm is not entitled to carry forward and set off so much of the losses proportionate to the share of a retired or deceased person exceeding his/her share of profits, if any, in the firm in respect of the previous year:

1. When the public are not substantially interested infirm
2. When the business or profession is succeeding by another person
3. When a change occurred in the constitution of the firm
4. None of the above

✅ Correct Answer: 3

Anand, a resident individual having computed for the previous year 1st April 2020 to 31st March 2021 his business loss at ₹ 60,000, short term capital gain on sale of gold of ₹ 40,000 long term capital gain on sale of house property of ₹ 3,60,000. The amount of total income to be declared in the return for the assessment year 2021-22 by Anand shall be

1. ₹ 4,00,000
2. ₹ 3,40,000
3. ₹ 4,00,000 and carry forward loss of ₹ 60,000
4. None of the above

✅ Correct Answer: 2

The loss computed under the head “Income from house property” can be set off by Intra head adjustment during the same year from:

1. Any other head of income up to a maximum of ₹ 2,50,000
2. Any other head of income up to a maximum of ₹ 3,00,000
3. Any other head of income up to a maximum of ₹ 5,00,000
4. Any other head of income up to a maximum of ₹ 2,00,000

✅ Correct Answer: 4

The benefit of carrying forward and set-off of losses under section 79 of Income-tax Act, 1961, by a closely held Indian company which is a subsidiary of a foreign company as a result of amalgamation or demerger, is subject to the condition that specified percentage of the shareholders of the amalgamating or demerged foreign company continues to be the shareholders of the amalgamated or the resulting foreign company which is:

1. 51%
2. 1096
3. 2696
4. 10096

✅ Correct Answer: 1

Business loss can be set off from income of any other business but cannot be set off from:

1. Salary Income
2. House Property Income
3. Long Term Capital Gains
4. Income from derivatives specified in section 43(5)

✅ Correct Answer: 1

Short term capital loss can be setoff as per provisions of section 72 of the Income-tax Act, 1961 from:

1. Short term capital gain
2. Short term capital gain and Long term capital gain
3. Long term capital gain
4. Short term capital gain and profit & gain from business

✅ Correct Answer: 2

The loss from the activity of owning and maintaining race horses is eligible for carrying forward and set off for a maximum period of:

1. 8 Assessment years
2. 6 Assessment years
3. 4 Assessment years
4. 2 Assessment years

✅ Correct Answer: 3

For the year ended 31 st March 2021, Paresh receives a salary of ₹ 2,80,000. Paresh’s contribution to employees’ recognized provident fund account is ₹ 59,000 and a matching contribution has been made by the employer. Taxable income of Paresh will be

1. ₹ 1,96,400
2. ₹ 2,06,400
3. ₹ 3,39,000
4. ₹ 2,80,000

✅ Correct Answer: 1

The maximum possible amount of deduction u/s 80DDB for senior citizen is

1. ₹ 75,000
2. ₹ 1,25,000
3. ₹ 1,00,000
4. ₹ 60,000

✅ Correct Answer: 3

Following is not allowed as deduction u/s 80TTA

1. Interest on deposits in savings account with a bank up to ₹ 10,000
2. Interest on time deposits with the bank up to ₹ 10,000
3. Interest on deposits in savings account with post office up to ₹ 10,000
4. Interest on deposits with co-operative society engaged in carrying on the business of banking up to ₹ 10,000

✅ Correct Answer: 2

The maximum amount of deduction u/s 80U allowed to a person with 80% or more of one or more disabilities is

1. ₹ 40,000
2. ₹ 60,000
3. ₹ 50,000
4. ₹ 1,25,000

✅ Correct Answer: 4

An Indian resident patentee is entitled to a deduction u/s 80RRB to the extent of

1. 100% of such income
2. 50% of such income
3. 100% of such income or ₹ 3,00,000 whichever is less
4. 50% of such income or ₹ 3,00,000 whichever is more

✅ Correct Answer: 3

Deduction under section 80CCG is available to an eligible resident individual whose gross total income does not exceed

1. ₹ 10,00,000
2. ₹ 12,00,000
3. ₹ 5,00,000
4. No such limit

✅ Correct Answer: 2

Sahil works in a technology company. On 1st January 2019, he took a loan of ₹ 2,40,000 from his company for the education of his daughter. During the year 2020-21, he paid an interest of ₹ 46,000 towards the said loan and repaid the principal component of ₹ 10,000. The deduction that he can claim u/s 80E would be

1. Nil
2. ₹ 24,000
3. ₹ 46,000
4. ₹ 10,000

✅ Correct Answer: 1

Under the Income-tax Act, 1961, which of the following can claim a deduction for any sum contributed during the previous year to a political party or electoral trust

1. Local authority
2. Individual
3. Artificial juridical person
4. None of the above

✅ Correct Answer: 2

Deduction in respect of donations to National Defence Fund is allowed u/s

1. 80G
2. 80CCG
3. 80C
4. None of the above

✅ Correct Answer: 1

Raman purchased a residential house property in Ahmedabad on loan for which he paid an interest of ₹ 50,000 during the previous year. He is working in Delhi and getting an HRA of ₹ 4,000 per month. He can claim exemption/deduction for

1. Only HRA
2. Only interest paid
3. Either interest paid or HRA but not both
4. Both HRA and interest paid.

✅ Correct Answer: 4

Which of the following cannot claim a deduction for the loan taken to purchase a house property?

1. Karta, in respect of property purchased by HUF
2. An individual, in respect of property purchased by him
3. Partner, in respect of property purchased by the firm
4. Spouse of an individual, in respect of property, purchased jointly by the individual and his/her spouse.

✅ Correct Answer: 3

The monetary limit for deduction in respect of royalty on patents received by a resident individual is

1. ₹ 1,00,000
2. ₹ 3,00,000
3. ₹ 5,00,000
4. Nil

✅ Correct Answer: 2

An individual has made investments in the schemes approved u/s 80C, and 80CCD of ₹ 2,50,000 and ₹ 1,00,000 respectively during the year ended 31st March 2021. Amount that can be claimed by him as deduction out of income in AY 2021-22 is

1. 50% of ₹ 3,50,000
2. ₹1,50,000 u/s 80C and ₹ 1,00,000 u/s 80CCD
3. ₹ 1,50,000
4. None of the above

✅ Correct Answer: 2

Raghu’s father is dependent on him and suffering from 90% disability. Raghu has incurred an amount of ₹ 72,500 in maintaining and medical treatment of his father. The deduction he can claim in his income-tax return for AY 2021-22 is

1. ₹ 72,500
2. ₹ 50,000
3. ₹ 1,25,000
4. None of the above

✅ Correct Answer: 3

Bharat, engaged in business, claimed that he paid ₹ 10,000per a month by cheque as rent for his residence. He does not own any residential buildings. His total income computed before deduction under section 80GG is ₹ 3,40,000. The amount he can claim as deduction under section 80GG is

1. ₹ 60,000
2. ₹ 86,000
3. ₹ 1,20,000
4. ₹ 85,000

✅ Correct Answer: 1

Rajan paid ₹ 25,000 to LIC of India for the maintenance of his disabled son and incurred ₹ 15,000 for the treatment of his handicapped wife who is working in the State Bank of India. The deduction allowable to him under Section 80DD is

1. ₹ 15,000
2. ₹ 25,000
3. ₹ 50,000
4. ₹ 75,000

✅ Correct Answer: 4

Rajan paid ₹ 25,000 to LIC of India for the maintenance of his disabled son and incurred ₹ 15,000 for the treatment of his handicapped wife who is working in the State Bank of India. The deduction allowable to him under Section 80DD is

1. ₹ 15,000
2. ₹ 25,000
3. ₹ 50,000
4. ₹ 75,000

✅ Correct Answer: 4

Deduction in respect of interest on savings accounts under Section 80TTA shall be allowed with respect to a savings account with

1. Bank
2. Co-operative society
3. Post office
4. All of the above

✅ Correct Answer: 4

Deduction under section 80C can be claimed for a fixed deposit made in any scheduled bank if the minimum period of deposit is

1. 5 Years
2. 8 Years
3. 10 Years
4. 12 Years

✅ Correct Answer: 1

In the case of which of the following co-operative society, the deduction under Section 80P is restricted to ₹ 1,00,000

1. Consumers’ co-operative society
2. Society engaged in collection and disposal of labor
3. Society engaged in fishing
4. Society engaged in processing of agricultural produce without the aid of power

✅ Correct Answer: 1

When a person suffers from severe disability, the quantum of deduction allowable under Section 80U is

1. ₹ 50,000
2. ₹ 75,000
3. ₹ 1,25,000
4. ₹ 1,00,000

✅ Correct Answer: 3

Under section 80QQB, the maximum deduction in respect of royalty is allowed up to

1. ₹ 1,00,000
2. ₹ 1,50,000
3. ₹ 2,50,000
4. ₹ 3,00,000

✅ Correct Answer: 4

An amount up to a maximum of ₹ 10,000 is deductible under Section 80TTA from the gross total income of

1. Individual only
2. HUF and Individual only
3. Company only
4. All assessee

✅ Correct Answer: 2

Deduction available u/s 80GG in respect of rent paid cannot be more than –

1. ₹ 6,000 p.m.
2. ₹ 5,000 p.m.
3. ₹ 2,000 p.m.
4. ₹ 110,000 p.m.

✅ Correct Answer: 2

Raghunath repaid during the previous year 2020-2021 education loan of ₹ 60,000 and interest on an education loan of ₹ 18,000 taken from Punjab National Bank for his son to pursue MS in India. The loan was taken in the financial year 2013-2014 and the payment commenced from the financial year 2014-2015. The amount eligible for deduction under section 80E for the assessment year 2021-22 is:

1. ₹ 60,000
2. ₹ 78,000
3. ₹ 18,000
4. Nil

✅ Correct Answer: 3

Shravan engaged in the business paid monthly rent of 15,000 by cheque for his residence during the previous year 2020-21. His adjusted total income is ₹ 3,40,000. The amount eligible for deduction under section 80GG is:

1. ₹ 86,000
2. ₹ 60,000
3. ₹ 26,000
4. ₹ 85,000

✅ Correct Answer: 3

Deduction under Section 80G on account of donation is allowed to:

1. A business assessee only
2. Any assessee
3. Individual or HUF only
4. Any resident assessee

✅ Correct Answer: 2

Donation to university for research in Social Science is eligible for deduction at:

1. 100%
2. 25%
3. 150%
4. 175%

✅ Correct Answer: 1

Mr. Mithun acquired a house property for ₹ 8 lakhs and paid stamp duty and registration fee of ₹ 80,000. He borrowed a housing loan and repaid a principal of ₹ 60,000 and interest of ₹ 20,000. The amount eligible for deduction under Section 80C would be:

1. ₹ 80,000
2. ₹ 60,000
3. ₹ 1,00,000
4. ₹ 1,40,000

✅ Correct Answer: 4