Dibrugarh University (6th Semester General) - Income Tax Important Questions and Answers

byKumar Nirmal Prasad -
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 Important Questions and Answers for May' 2017 Exam

 Unit 1
Q. Define the term “Previous year”. And “Assessment year? “Income taxis charged on the income of the previous year.” Do you fully agree with this statement? If not, what are the exceptions?

Q. “The incidence of tax depends upon the residential status of an assessee.” Discuss. How Residential Status of the following is Determined:
Ø  Individual
Ø  HUF
Ø  Company
Ø  Firm
Ø  AOP and BOI

Q. “The incidence of tax depends upon the residential status of an assessee.” Discuss. Distinguish Tax Evasion, Tax Avoidance, Tax Mitigation and tax planning.

 Q. "Every assessee is a Person, but every person is not an assessee". considering this statement, define the term “assessee” and “person” under the income tax act.What is regarded as income under the income tax act?

Q. Write short notes on: (a) Assessment year (b) Previous Year (c)Charge of income tax (d) Capital asset (e) Agricultural income (f) Person (g) Assessee (h) Revenue Vs Capital expenditure (i) Gross Total Income (j) Capital receipts (k) Revenue Receipts Vs Capital Receipts (l) Tax Return (m) Method of accounting (n) Income Tax rates for the Assessment year 2016 - 17


Unit 2
Q. Explain in brief various incomes which are exempted u/s 10 of the Indian income Tax Act.

Q. What are the tax benefits for industrial unit established in:
Ø  SEZ
Ø  EOU  (Export Oriented Undertakings)
Ø  FTZ (Free Trade Zone)


Unit 3
Q. Explain the provisions of the income – tax Act, 1961 with regard to the following:
Ø  Gratuity
Ø  Commuted and Uncommuted Pension
Ø  Voluntary Retirement Compensation
Ø  Approved Super Annuation fund
Ø  Encashment of earned leave
Ø  Profit in Lieu of Salary
Ø  Retrenchment Compensation
Ø  Deduction u/s 80C and Under sec. 16
Ø  Relief u/s 89(1) of the Income tax Act.

Q. What Constitutes Salary Under sec. 17 of Income tax act, 1961? Explain the basis of charge of salary. What are the essential characteristics of Salary?

Q. Define ‘perquisite’ as per income tax act. Explain how perquisites are taxable in the hand of employee.

Q. Explain the various types of Provident fund with their respective treatment as per Income Tax Act, 1961.

 Q. What is Allowance? What are various types of Allowances given by employers to their employees?


Unit 4
Q. Explain the Basis of Charge of Income under the head Income from House Property.

Q. Define annul value. How does it differ from annual rental value? How would you determine the annual value of the house used by assessee as let-out and self occupied residence in computing taxable income from house property?

Q. What deductions are allowed from the annual value in computing taxable income from house property? Also mention the deductions which are not allowed from house property.

Q. Write Short Notes on:
Ø  ExemptedHouse Property Income
Ø  Deemed Ownership
Ø  Income From Co-owned Property
Ø  Unrealised rent and its Treatment


Unit 5 (Part A - For old course only)
Q. What do you mean by capital gains. Explain in detail capital gain exempted from tax.

Q. How would you determine cost of acquisition? Describe the procedure of ascertaining Short Term capital Gains and long term capital Gains.

Q. Explain the concept of Transfer under the head capital gains. Mention the transactions which are not regarded as transfer.

Q. Write notes on capital assets and transfer. How will you distinguish between capital gain’ and income?

 Q. Write short notes on taxability and set-off and carry forward of losses under the head capital gain.

Unit 5 (Part B - for old course only)
Q. What are the incomes and deemed incomes chargeable under the head “Income from other sources”?
Q. What do you mean by Income from other sources? Explain the allowed and disallowed deductions under the head income from other sources.
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Posted by Kumar Nirmal Prasad