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Hi all
Here's the Updated Question Bank of Income Tax MCQs for CA-Inter May 23

It contains all ICAI MCQs as well as additional MCQs for practice

Detailed Solution of every MCQ has been provided as per Updated Provisions of Finance Act 2022

From 2moro, we will start with daily practice of MCQs on our Telegram group.

2 MCQ questions will be posted everyday in form of Poll

Till exam, we will be able to practice more and more MCQs through telegram

Income Tax Question for Today:- During the P.Y. 2022-23, Mr. Samar, a non-resident, received Rs.75,00,000 on account of sale of agricultural land in Mauritius. The money was first received in Mauritius and then remitted to his Indian bank account. Is the sum taxable in India?
(a) No, as agricultural income is exempt u/s 10(1).
(b) No, as the income has accrued and arisen outside India and is also received outside India.
(c) Yes, since it is remitted to India in the same year.
(d) Yes, as agricultural income earned outside India is not exempted in India in the hands of a non-resident

The correct answer to above question would be (B). Any capital gains arising from transfer of an agricultural land is not covered in definition of Agricultural income and hence exemption u/s 10(1) shall not be applicable. However, since the land is located outside India, such capital gain would be considered as accrued as well as received outside India which can’t be taxed in hands of NR

Income Tax Question for Today:- Ms. Sowmya has three farm buildings situated in the immediate vicinity of a rural agricultural land. In the P.Y.2022-23, she earned
- Rs. 3 lakh from letting out her farm building 1 for storage of food grains,
- Rs. 10 lakh from letting out her farm building 2 for storage of dairy products and
- Rs. 15 lakh from letting out her farm building 3 for residential purposes of Mr. Sumanth, whose food grain produce is stored in farm building 1.

What is the amount of agricultural income exempt from income-tax?
(a) Nil
(b) Rs. 3,00,000
(c) Rs. 13,00,000
(d) Rs. 18,00,000

The correct answer to above question would be (B). As per Sec 2(1A), income from farm building located in rural area shall be considered as agricultural income if such building is, by reason of connection with the land, used as a dwelling house or a store house or an out-house by the cultivator or receiver of rent in kind. In the given case, Building 1 is covered in above purposes but Building 2 and 3 don’t satisfy the above condition

Income Tax Question for Today:- Gross total income of Arpita for P.Y. 2022-23 is Rs. 6,00,000. She had taken a loan of Rs. 7,20,000 in the financial year 2019-20 from a bank for her husband who is pursuing MBA course from IIM, Kolkata. On 02.04.2022, she paid the first installment of loan of Rs. 45,000 and interest of Rs. 65,000. Compute her total income for A.Y. 2023-24.
(a) Rs. 6,00,000
(b) Rs. 5,35,000
(c) Rs. 4,90,000
(d) Rs. 5,55,000

The correct answer to above question would be (B). Since education loan has been taken higher education of spouse, interest paid during PY 22-23 shall be eligible for deduction u/s 80E. Hence Total Income = Rs. 6,00,000 - Rs. 65,000 = Rs. 5,35,000

Income Tax Question for Today:- Mr. Krishna, a resident Indian aged 61 years, maintains a saving account with a co-operative land development bank and he earns Rs. 20,000 as interest on saving account for the Financial Year 2021-22. Mr. Krishna also maintains a fixed deposit and recurring deposit account with Mani Finance (A Non-Banking Finance Company) and earns Rs. 25,000 and Rs. 10,000 as interest on fixed deposit and recurring deposit, respectively. What would be the deduction allowable to Mr. Krishna under Chapter VI-A if he does not opt for the section 115BAC for the A.Y. 2023-24?
(a) Rs. 55,000
(b) Rs. 10,000
(c) Rs. 20,000
(d) Rs. 50,000