MCQ Portal

1. AB Ltd. has debited a sum of 780 lakhs towards income-tax in its Statement of Profit and Loss for the year ended 31-3-2023. It includes 34 lakhs towards surcharge and ₹6 lakhs towards HEC. How much would be the amount of disallowance of income-tax under section 40(a)(ii)?

Nil 740 lakhs 774 lakhs 780 lakhs

2. For Doomsday Ltd. there was an outstanding interest payment due to a nationalized bank of 340 lakhs, which was converted into 8% Debentures on 12-03-2023. How much of interest due to the bank would be deemed as paid and allowable under section 43B by issue of 8% debentures?

Nil 85 lakhs 170 lakhs 340 lakhs

3. Bala was found to be the owner of jewellery worth 22,60,000 during the financial year ending 31.03.2023 which was not recorded in his books of account and he could not offer satisfactory explanation of the source of income for acquiring the same. How much of income-tax is payable by Bala under section 115BBE (including surcharge and cess, if any) for the said jewellery?

17,62,800 7,05,120 5,10,120 4,32,120

4. Ramesh & Co paid 5 lakhs to Wave Inc, a foreign company not having a PE in India towards online digital advertisement charges. How much is the amount payable by Ramesh & Co as equalisation levy for the payment made?

30,000 31,200 Nil 12,000

5. The total income of Minerals (P) Ltd., a trading company, computed as per the normal provisions of Income-tax Act is 8,40,000 for the year ended 31st March, 2023. The annual turnover of Minerals (P) Ltd. was always less than 10 crores. Book profit of the company computed as per the provisions of section 115 JB is 18,40,000. What would be the final tax liability of the company for the assessment year 2023-24? Ignore the surcharge and Cess

₹2,52,000 ₹2,76,000 2,10,000 2,25,000

6. During the course of assessment in the case of M & Co (firm), the Assessing Officer found out one accommodation entry (bogus purchase) for 7 lakh from another firm by name P & Co. Both M & Co and P & Co have admitted fake invoice and accommodation entry. What would be the penal consequence of the transaction? (Ignore HEC)

Penalty on M & Co @100% of tax being 2,10,000 Penalty on M & Co @200% of tax being 4,20,000 Penalty on M & Co @200% of transaction being 2,10,000 and amount equal to the transaction being 7,00,000 Penalty on M & Co @200% of tax being 4,20,000 plus the amount equal to the transaction being ₹7,00,000. Also penalty equal to the amt of transaction on P&Co being 7,00,000

7. Mr. A filed his return of income for the assessment year 2023-24 on 20th December, 2023. He noticed in January, 2024 that he has omitted to admit income from business of 4 lakhs in the ITR filed by him for the assessment year 2023-24. What is the maximum time limit available for Mr. A to file updated return?

31.03.2024 31.03.2025 31.03.2026 31.03.2027

8. Little Co. Ltd., Delhi, proposes to enter into a transaction for purchase of raw material from UK and sale of finished goods to its group company located in Australia. It has obtained advance ruling in respect of the transactions but it is aggrieved with the ruling given by Board for Advance Rulings. What is the legal remedy available to Little Co. Ltd?

File an appeal before Commissioner (Appeals) against the ruling. File an appeal before ITAT against the ruling. File an appeal before High Court against the ruling. File a revision petition under section 264 with Commissioner.

9. Income-tax authority having jurisdiction of Azeem & Co conducted a survey under section 133A and seized the books of account and other documents on 10.10.2022. What is the maximum time limit that the books of account and other documents can be retained by the Income-tax authority without obtaining permission of higher authorities?

Up to 15 days exclusive of holidays Up to the end of the previous year i.e. 31.03.2023 Up to 30 days exclusive of holidays Up to the date of completion of assessment under section 143(3)

10. Srinath (P) Ltd. filed its return of income with suo moto adjustment of 300 lakhs in respect of ALP of its transactions with its associated enterprise. Within how many days the amount of secondary adjustment must be repatriated to India in order to avoid interest under section 92 CE read with rule 10CB?

Within 90 days from the end of the assessment year Within 120 days from the date of filing ITR Within 90 days from the 'due date' specified in section 139(1) Within 30 days from the end of the assessment year

11. How much is the minimum tax effect that should be involved to invoke GAAR provisions?

No minimum limit 3 crores 5 crores 10 crores

12. Which model of DTAA, does Government of India generally follow in its treaty with other countries?

UK Model US Model UN Model OECD Model

13. Mesne (P) Ltd. engaged in international transactions entered into APA on 1st June, 2022. Its appeal before CIT (Appeals) was pending for the assessment year 2021-22 and the ITAT has given decision in favour of the Revenue for the assessment year In 2020-21. It wants to avail rollback benefit. Assume that the returns of income of all the assessment years were filed before the 'due date' specified in section 139(1). For which of the assessment years the rollback benefit would be available?

Assessment year 2018-19 to assessment year 2021-22 Assessment year 2019-20 to assessment year 2022-23 Assessment years 2019-20, 2020-21 and 2022-23 Assessment years 2019-20, 2021-22 and 2022-23

14. Ramji Ltd. entered into international transactions during the previous year 2022-23 for a sum exceeding 10 crores. It has omitted to furnish report from an accountant as required under section 92E. What is the quantum of penalty leviable for the failure to furnish report from the accountant?

₹50,000 ₹ 1,00,000 ₹1,50,000 0.5% of the transactions being ₹ 5,00,000

15. In the assessment of Amit (P) Ltd. there was increase in income by way of arm's length price adjustment of 200 lakhs. The assessee decided to pay additional income-tax instead of making secondary adjustment. What is the tax rate at which the additional income-tax is payable by the assessee?

10.92% 16.692% 20.9664% 23.296%

Dec 23 DT Paper