Income-tax and Corporate Tax Planning - Income Tax and Corporate Tax Planning Section 1

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1. If a taxpayer, in spite of the requirement of section 44AB, fails to get his accounts audited, then he shall be liable for penalty under section 271B of one-half percent of total sales, turnover or gross receipts, etc., or whichever is less.

  • Option : B
  • Explanation : Section 44AB prescribes when the accounts of the taxpayer are to be audited. If a taxpayer, in spite of the requirement of section 44AB, fails to get his accounts audited, then he shall pay penalty under section 271B. The penalty under section 271B will be levied for failure to get the accounts audited or failure to furnish a report of audit as required under section 44AB. The penalty will be a one-half percent of total sales, turnover or gross receipts, etc., or Rs. 1,50,000, whichever is less.
    Thus, option (b) is the correct option.
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2. Section 269SS provides that no person shall take or accept a loan or deposit or specified sum exceeding Rs. 50,000 by any mode other than account payee cheque or account payee demand draft or by use of electricity clearing system through a bank account. Contravention of the provisions of section 269SS will attract penalty under section 271D of an amount equal to loan or deposit taken or accepted or specified sum.

  • Option : B
  • Explanation : Section 269SS provides that no person shall take or accept a loan or deposit or specified sum exceeding Rs. 20,000 by any mode other than account payee cheque or account payee demand draft or by use of electricity clearing system through a bank account. Contravention of the provisions of section 269SS will attract penalty under section 271D. The penalty under section 271D shall be levied of an amount equal to loan or deposit is taken or accepted or specified sum.
    Thus, the statement given in the question is false and hence, option (b) is the correct option.
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3. The penalty under section 271FA shall be levied for failure to file a statement of financial transaction or reportable account (previously called asAnnual Information Return). The penalty under section 271FA is Rs. for every day during which the failure continues.

  • Option : C
  • Explanation : The penalty under section 271FA shall be levied for failure to file a statement of financial transaction or reportable account. The penalty under section 271FA is Rs. 100 for every day during which the failure continues.
    Thus, option (c) is the correct option.
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4. What is the rate of penalty for underreporting of income under Section 270A?

  • Option : D
  • Explanation : The rate of penalty shall be fifty per cent of the tax payable on under-reported income. However, in a case where under-reporting of income results from misreporting of income, the taxpayer shall be liable for penalty at the rate of two hundred per cent of the tax payable on such misreported income.
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5. As per section 271H, where a person fails to file the statement of tax deducted/collected at source i.e. TDS/TCS return on or before the due dates prescribed in this regard, then he shall be liable to pay penalty under section 271H. The minimum penalty can be levied of Rs. 10,000 which can go up to Rs.

  • Option : A
  • Explanation : As per section 271H, where a person fails to file the statement of tax deducted/collected at source i.e. TDS/TCS return on or before the due dates prescribed in this regard, then he shall be liable to pay penalty under section 271H. The minimum penalty can be levied of Rs. 10,000 which can go options. 1,00,000. The penalty under section 271H will be in addition to late filing fee prescribed under section 234E.
    Thus, option (a) is the correct option.
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      • Income tax questions can be used to gain a credit score in various undergraduate and postgraduate commerce courses like B com and Mcom
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