1. SHEC is half of the education case.

 TRUE – While the Education Cess is 2% of the Amount of Tax, Second

and Higher Education Cess is 1% of the amount of tax.
2. Salary received by the members of parliament is exempted from tax.
 False – The salary recieved by members of Parliament is taxable under
the head “Income from Other Sources”.
3. Deduction under section 80 C is allowed to the extent of Rs 1,40,000.
 False – For AY 2015 – 16, the amount of deduction u/s 80 C is Rs
1,50,000.
4. Body of individual should consist of individual only.
 True – Body of Individual is a group of Individuals only.
5. Casual income received by the assesses is fully exempt.
 False – Casual Income is fully Taxable.
6. Conversion of personal effects into stock-trade shall be subject to capital
gain.
 False – Personal Effects and Stock in trade both are not included in the
definition of Capital Assets and thus are not subject to Capital Gain.
7. Loss under the head capital gain in a particulars assessment year can neither
be set off nor carried forward.
 False – While STCL can be set – off with LTCG or STCG, or any other
income, the LTCL can be setoff only against LTCG. Both LTCL and
STCL if not fully set-off can be carried forward for 8 immediately
succeeding previous years.
8. Agricultural land is exempt provide the land is situated in any rural area in
India.
 TRUE – Agricultural Income from Rural Land is exempted from Income
Tax.
9. A person may not have assessable income but may still be an assesses.
 TRUE
10. Family pension is taxable under the head of income from salary.
 FALSE – It is taxable under the head Income from Other Sources.
11. Net Annual value of self-occupied residential house property can be
negative.
 FALSE – In case of Self – Occupied Residential House Property, the
GAV is taken as NIL and no deduction for Municipal Taxes paid will be
allowed. Hence the NAV will be NIL.
12. As per sec 64 (1A) income accruing to a minor child shall be clubbed in the
income of father or mother at their option.
 FALSE – The income of Minor shall be clubbed in the hand of that
parent who has higher taxable income before such clubbing. However if
the parents are living seperatly or divorced, then Income shall be clubbed
in the hand of that parent who is maintaining the minor during the
relevant previous year.
13. Agriculture income in India is exempt from tax even if the agriculture land is
situated outside India.
  False – Agricultural income from land in Rural India is exempt and not
from land outside India.
14. SHEC is half of the education cess.
 TRUE
15. A resident in India can become resident in any other country for the same
assessment year.
 TRUE – For the purpose of Income Tax, a person is resident if he
satisfied any one of the basic condition of period of stay in India during
the relevant previous year.
16. Profit in lieu of salary is taxable under the head “Income from other source”
 FALSE – It is taxable under the head “Income From Salary”.
17. Municipal Tax is a deduction from Net Annual Value.
 FALSE – Municipal Taxes are deducted from GAV to arrive at NAV,
 i.e. NAV = GAV – Municipal Taxes
18. Internal on securities is always taxable under the head Income from other
sources.
 TRUE
19. Rural agriculture land situated in India is a capital asset.
 FALSE – Rural Agricultural Land in India is excluded from the
definition of Capital Asset.
20. Dividend received by a company from a domestic company is exempted.
 TRUE – Dividend received from an Indian Company is exempted in the
hands of shareholders u/s 10.
21. In some cases assessment year and previous year can be same financial year.
 TRUE
22. No person other than individual or H.U.F can be resident but not ordinary
residential in India.
 TRUE – Every person other than Individual or HUF can either be
resident or non resident.
23. Uncommuted pension received by a Government employee is fully
exempted.
 TRUE
24. Gross Annual value of the house property cannot exceed standard rent.
 FALSE – GAV of a house property will be Standard Rent or Actual Rent
whichever is higher.
25. Income from subletting of house property is taxable under the head Income
from Other sources.
 TRUE
26. Deduction u/s 80C is allowed to the extent of RS 1, 40,000.
 FALSE for AY – 2015 – 16
27. An Indian company is always resident in India.
 TRUE
28. Assesse is always a person, but a person may or may not be an assessee.
 TRUE – Any person who is liable to pay Income Tax in India is
Assessee.
29. Salary received by a member of a parliament is taxable under the head of
Income from salary.
 FALSE – It is taxable under the head Income from Other Sources.
30. Net annual value of let out property can be negative.
 TRUE – NAV = GAV – Municipal Taxes Paid, therefor it can be
negative also.
31. Depreciation is allowed in case of tangible assets only.
 FALSE – In case of Intangible assests, amortisation is allowed.
32. The exemption under section 54B is allowed to an individual assessee only.
 FALSE – Exemption u/s 54B (Capital Gain arrising from the transfer of
land used for agricultural purpose) is allowed to both INDIVIDUAL and
HUF.
33. Dividend received from a domestic company is taxable under the head
“Income from other sources”
 FALSE – It is exempted u/s 10.
34. Loss under the head house property cab be set-off only against income from
house property.
 FALSE – U/s 7, the losses under the head Income from house property
can be set off against any income.
35. Family pension received by a nominee on the death of an employee is
taxable under the head “salaries”
 False – It is taxable under the head Income from Other Sources.
36. Hindu undivided family is never a “Not ordinarily Resident”
 False – Depending upon the stay of Karta, an HUF can be” resident and
ordinarily resident” or ” Resident but not Ordinarily resident”.
37. Salary received by a Member of Parliament is taxable under the head
salaries.
 False – It is taxable under the head Income from Other Sources.
38. Salary of a Member of Parliament is taxable under the head “salary”
 False – It is taxable under the head Income from Other Sources.
39. Income of self-occupied house cannot be negative.
 False – although the NAV of a self-occupied residential house will be
zero and no standard deduction u/s 24a will be allowed, but deduction for
Interest paid u/s 24b will be allowed and therefore the Income of self-
occupied house can be negative.
40. There can be long-term capital gain on sale of deprecation assets.
 FALSE – In case of depreciate assets, there will be either Short Term
Capital Gain or Short Term Capital Loss.
41. There is no difference between Gross Total Income and Total income.
 FALSE – Net Taxabel Income = Gross Total Income – Deductions u/s
80C to 80U.
42. Cash gift of less than RS 50,000 is exempt from tax.
 FALSE – Cash Gifts upto Rs 5000 are exempted from tax.
43. Agriculture land in India situated outside the municipal borders is not capital
assets.
 TRUE
44. A senior citizen is one who is of 60 year of more on or before 31st March of
the previous year.
 TRUE
45. There can be long-term capital gain on sale of deprecation assets.
 FALSE
46. Salary is taxable on due basic or receipt basis whichever moment is earlier.
 TRUE
47. Previous year precedes assessment year.
 TRUE
Deduction u/s 80C is allowed to Individual and HUF ONLY TRUE
48.