📘Topics: Interest, Penalties & Prosecution | Tax Collection & Recovery | Refunds | Corporate Taxation 100 MCQs
🔹 Interest, Penalties & Prosecution
1.
Interest under Section 234A is charged for:
A. Late payment of advance tax
B. Late filing of return
C. Short payment of TDS
D. Concealment of income
Answer: B
2.
Interest under Section 234B applies when:
A. Return not filed
B. Advance tax paid < 90%
C. TDS not deducted
D. Refund claimed wrongly
Answer: B
3.
Section 234C relates to:
A. Delay in return filing
B. Deferment of advance tax
C. Penalty for concealment
D. TDS default
Answer: B
4.
Interest under Section 234A is calculated on:
A. Gross income
B. Net income
C. Tax payable
D. Assessed tax
Answer: D
5.
Penalty under Section 270A relates to:
A. Late filing
B. Under-reporting of income
C. TDS default
D. Refund delay
Answer: B
6.
Misreporting of income penalty rate is:
A. 50%
B. 100%
C. 200%
D. 300%
Answer: C
7.
Section 271AAC deals with penalty on:
A. Undisclosed income
B. TDS default
C. Late return
D. Advance tax
Answer: A
8.
Penalty under Section 271AAC is:
A. 10%
B. 20%
C. 30%
D. 60%
Answer: A
9.
Prosecution for wilful attempt to evade tax is under:
A. 276C
B. 271A
C. 234B
D. 80C
Answer: A
10.
Failure to file return may lead to prosecution under:
A. 276CC
B. 270A
C. 234A
D. 80G
Answer: A
11.
Interest under 234B is charged from:
A. Date of return
B. 1st April of AY
C. 31st March
D. Date of notice
Answer: B
12.
Interest rate under 234A/B/C is:
A. 0.5%
B. 1% per month
C. 2%
D. 5%
Answer: B
13.
Penalty under 271AAB relates to:
A. Search cases
B. TDS
C. Refund
D. Advance tax
Answer: A
14.
Failure to maintain books penalty is under:
A. 271A
B. 270A
C. 234A
D. 276C
Answer: A
15.
Penalty for failure to get accounts audited is:
A. 271A
B. 271B
C. 271C
D. 271D
Answer: B
🔹 Tax Collection & Recovery
16.
Advance tax is payable if tax liability exceeds:
A. ₹5,000
B. ₹10,000
C. ₹20,000
D. ₹50,000
Answer: B
17.
Due date for 1st installment of advance tax:
A. 15 June
B. 15 Sept
C. 15 Dec
D. 15 March
Answer: A
18.
TDS is governed by:
A. Section 192–196D
B. Section 80C
C. Section 10
D. Section 234A
Answer: A
19.
TCS is governed under:
A. Section 206C
B. Section 194
C. Section 80G
D. Section 10
Answer: A
20.
Self-assessment tax is paid under:
A. 140A
B. 139
C. 234A
D. 80C
Answer: A
21.
Notice of demand is issued under:
A. 156
B. 143
C. 148
D. 271
Answer: A
22.
Time limit to pay demand after notice:
A. 15 days
B. 30 days
C. 60 days
D. 90 days
Answer: B
23.
If tax not paid, assessee becomes:
A. Defaulting assessee
B. Deemed assessee
C. Regular assessee
D. Exempt assessee
Answer: A
24.
Recovery proceedings initiated under:
A. 222
B. 234
C. 80C
D. 10
Answer: A
25.
Tax Recovery Officer is appointed under:
A. Section 2
B. Section 222
C. Section 139
D. Section 80G
Answer: B
26.
Modes of recovery include:
A. Attachment
B. Arrest
C. Sale of property
D. All of these
Answer: D
27.
Certificate of recovery is issued under:
A. 222
B. 143
C. 80C
D. 234A
Answer: A
28.
Stay of demand can be granted by:
A. AO
B. CIT(A)
C. ITAT
D. All of these
Answer: D
29.
Refund is governed under:
A. Section 237
B. Section 80C
C. Section 234A
D. Section 270A
Answer: A
30.
Interest on refund is under:
A. 244A
B. 234A
C. 271A
D. 80C
Answer: A
🔹 Refunds
31.
Refund arises when:
A. Tax paid < liability
B. Tax paid > liability
C. No tax paid
D. Income exempt
Answer: B
32.
Interest on refund is:
A. 0.5%
B. 1%
C. 2%
D. 5%
Answer: A
33.
Refund can be adjusted against:
A. Future tax
B. Past dues
C. Both
D. None
Answer: B
34.
No refund if amount less than:
A. ₹50
B. ₹100
C. ₹500
D. ₹1000
Answer: B
35.
Refund claim time limit:
A. 1 year
B. 2 years
C. 4 years
D. No limit
Answer: C
🔹 Corporate Taxation
36.
Domestic company tax rate (normal):
A. 25%
B. 30%
C. 35%
D. 40%
Answer: B
37.
Section 115BAA provides tax rate of:
A. 15%
B. 22%
C. 25%
D. 30%
Answer: B
38.
115BAB applies to:
A. Old companies
B. New manufacturing companies
C. Individuals
D. Firms
Answer: B
39.
Tax under 115BAB:
A. 15%
B. 22%
C. 25%
D. 30%
Answer: A
40.
MAT is under section:
A. 115JB
B. 80C
C. 234A
D. 270A
Answer: A
41.
MAT rate approx:
A. 10%
B. 15%
C. 18.5%
D. 25%
Answer: C
42.
Dividend income is taxed in hands of:
A. Company
B. Shareholder
C. Government
D. None
Answer: B
43.
Surcharge applies based on:
A. Turnover
B. Income
C. Profit
D. Capital
Answer: B
44.
Health and education cess is:
A. 2%
B. 3%
C. 4%
D. 5%
Answer: C
45.
Corporate tax applies to:
A. Individuals
B. Companies
C. Firms
D. HUF
Answer: B
46.
Foreign company tax rate:
A. 25%
B. 30%
C. 40%
D. 50%
Answer: C
47.
Book profit is relevant for:
A. Normal tax
B. MAT
C. TDS
D. Refund
Answer: B
48.
MAT credit can be carried forward for:
A. 5 years
B. 10 years
C. 15 years
D. Unlimited
Answer: C
49.
115BAA companies cannot claim:
A. Depreciation
B. Certain deductions
C. Revenue expenses
D. Capital expenses
Answer: B
50.
Corporate tax return filed under:
A. 139(1)
B. 80C
C. 234A
D. 271A
Answer: A
🔹 Interest, Penalties & Prosecution (Advanced)
51.
Interest under Section 234A is not applicable if:
A. Return filed on time
B. Tax fully paid before due date
C. Both A and B
D. Income below exemption
Answer: C
52.
Interest u/s 234B is not levied when:
A. No advance tax payable
B. Tax fully paid by TDS
C. Both A and B
D. Return filed late
Answer: C
53.
Under-reporting excludes:
A. Income reassessed
B. Income determined under MAT
C. Income as per return
D. Deemed income
Answer: C
54.
Penalty for under-reporting is:
A. 50% of tax
B. 100% of tax
C. 200% of tax
D. 300% of tax
Answer: A
55.
Wilful evasion involving ₹25 lakh may result in imprisonment up to:
A. 6 months
B. 2 years
C. 7 years
D. 10 years
Answer: C
56.
Failure to deposit TDS attracts penalty under:
A. 271C
B. 270A
C. 234B
D. 80C
Answer: A
57.
Interest u/s 220(2) applies when:
A. Delay in refund
B. Delay in payment after demand
C. Late filing
D. Advance tax default
Answer: B
58.
Compounding of offences is:
A. Mandatory
B. Discretionary
C. Prohibited
D. Automatic
Answer: B
59.
Penalty proceedings are:
A. Criminal
B. Civil
C. Administrative
D. Judicial
Answer: B
60.
Mens rea is required in:
A. Penalty
B. Interest
C. Prosecution
D. Refund
Answer: C
🔹 Tax Collection & Recovery (Advanced)
61.
If assessee defaults, AO can recover from:
A. Employer
B. Debtor of assessee
C. Bank
D. All of these
Answer: D
62.
Garnishee proceedings are under:
A. 222
B. 226(3)
C. 234A
D. 80C
Answer: B
63.
Recovery certificate is issued by:
A. AO
B. CIT
C. TRO
D. ITAT
Answer: A
64.
Arrest for tax recovery requires approval of:
A. AO
B. TRO
C. CIT
D. ITAT
Answer: B
65.
Stay of demand requires:
A. Full payment
B. Partial payment
C. No payment
D. Only appeal
Answer: B
66.
Tax recovery from legal heir limited to:
A. Total tax
B. Estate inherited
C. Income
D. Assets
Answer: B
67.
Recovery proceedings can be stayed by:
A. AO
B. CIT(A)
C. ITAT
D. All
Answer: D
68.
Recovery of tax includes:
A. Penalty
B. Interest
C. Tax
D. All
Answer: D
69.
Certificate once issued under 222:
A. Can be withdrawn
B. Cannot be withdrawn
C. Modified only
D. Cancelled automatically
Answer: A
70.
Recovery proceedings can continue despite:
A. Appeal filed
B. Stay granted
C. Tax paid
D. Refund issued
Answer: A
🔹 Refunds (Advanced)
71.
Interest on refund is calculated from:
A. Date of return
B. Date of tax payment
C. Date of assessment
D. End of AY
Answer: B
72.
Refund due to excess TDS is:
A. Automatic
B. On application
C. Not allowed
D. Discretionary
Answer: A
73.
Delayed refund interest rate:
A. 0.5% per month
B. 1%
C. 2%
D. 5%
Answer: A
74.
Refund withheld under section:
A. 241A
B. 80C
C. 234A
D. 270A
Answer: A
75.
Refund can be denied if:
A. Return filed late
B. Assessment pending
C. Demand exists
D. All
Answer: D
76.
Refund adjustment requires:
A. Notice
B. Approval
C. Consent
D. None
Answer: A
77.
Interest on delayed refund beyond time limit:
A. Simple interest
B. Additional interest
C. Compound interest
D. No interest
Answer: B
78.
Refund claim can be revised:
A. Yes
B. No
C. Only once
D. Only by AO
Answer: A
79.
Refund includes:
A. Tax
B. Interest
C. Penalty
D. All
Answer: D
80.
No interest if refund due to:
A. Delay by assessee
B. Delay by department
C. Court order
D. Advance tax
Answer: A
🔹 Corporate Taxation (Advanced)
81.
115BAA requires:
A. MAT applicability
B. No deductions
C. Higher tax
D. Mandatory adoption
Answer: B
82.
Companies opting 115BAA cannot claim:
A. 80C
B. 80IA
C. Depreciation
D. Business expense
Answer: B
83.
MAT not applicable to companies under:
A. 115JB
B. 115BAA
C. 234A
D. 80C
Answer: B
84.
Book profit includes:
A. Net profit
B. Adjustments
C. Both
D. None
Answer: C
85.
MAT credit allowed when:
A. MAT > normal tax
B. Normal > MAT
C. Both
D. None
Answer: B
86.
Dividend from domestic company:
A. Exempt
B. Taxable
C. Partially exempt
D. Not income
Answer: B
87.
Surcharge on domestic company applies if income exceeds:
A. ₹50 lakh
B. ₹1 crore
C. ₹2 crore
D. ₹5 crore
Answer: B
88.
115BAB condition includes:
A. Manufacturing activity
B. No old machinery
C. Both
D. None
Answer: C
89.
Foreign company surcharge threshold:
A. ₹50 lakh
B. ₹1 crore
C. ₹10 crore
D. ₹5 crore
Answer: B
90.
MAT credit utilization is allowed up to:
A. Tax liability
B. MAT liability
C. Lower of both
D. Higher of both
Answer: A
91.
Corporate tax includes:
A. Income tax
B. Surcharge
C. Cess
D. All
Answer: D
92.
Set-off of MAT credit allowed against:
A. Normal tax
B. MAT
C. Both
D. None
Answer: A
93.
115BAA rate excludes:
A. Surcharge
B. Cess
C. Both
D. None
Answer: C
94.
Book profit for MAT excludes:
A. Income tax
B. Reserve
C. Depreciation
D. Both A & B
Answer: D
95.
Minimum Alternate Tax ensures:
A. Zero tax
B. Minimum tax
C. Maximum tax
D. No compliance
Answer: B
96.
Corporate return due date (audit cases):
A. 31 July
B. 31 Oct
C. 30 Sept
D. 31 Dec
Answer: B
97.
Transfer pricing applies to:
A. Domestic only
B. International transactions
C. Individuals
D. Firms only
Answer: B
98.
Arm’s length price ensures:
A. Tax avoidance
B. Fair pricing
C. Profit shifting
D. Loss creation
Answer: B
99.
Advance tax for companies payable in:
A. 2 installments
B. 3 installments
C. 4 installments
D. 1 installment
Answer: C
100.
Corporate tax liability arises on:
A. Income
B. Turnover
C. Capital
D. Assets
Answer: A
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