XX Taxation in Securities Markets - 12

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Q 1. What method is used to determine the period of holding for securities held in Demat form?

Last-in-First-out (LIFO) method

First-in-First-out (FIFO) method

Weighted average method

None of the above
 
Q 2. How is the market price of gold determined for Sovereign Gold Bonds (SGBs) on redemption?

Fixed by the Government of India

Based on the investor's purchase price

Based on RBI's valuation

Determined by the World Gold Council
 
Q 3. How is a person's residential status determined under the Income-tax Act?

Based on their citizenship only

Based on their period of stay in India only

Based on their total income from Indian sources only

Based on their employment status in India
 
Q 4. Which market participant maintains records of holders of securities issued by a body corporate?

Share Transfer Agents

Credit Rating Agencies

Investment Advisors

None of the above
 
Q 5. What is the purpose of SEBI Turnover Charges?

Regulating stock exchanges

To facilitate shared transfers

To provide liquidity to the market

Encourage long-term investment
 
Q 6. What constitutes the sale consideration for the transfer of bonus shares?

Fair market value as of the date of the transfer

The original cost of acquisition

The amount received or receivable by the seller

Fair market value as of 01-04-2001
 
Q 7. What is the primary objective of the National Pension System (NPS)?

Provide immediate financial assistance to retirees

Encourage citizens to rely solely on government pensions

Offer a voluntary retirement savings scheme for disciplined savings and prudent investment

Provide universal basic income to all citizens post-retirement
 
Q 8. What is the formula to calculate the fair market value of unquoted shares using the Book Value Method?

Book Value of Assets / Book Value of Liabilities

Book Value of Liabilities / Book Value of Assets

Paid-up value of equity shares / Total amount of paid-up equity share capital

Total value of assets / Total value of capital and liabilities
 
Q 9. What is the purpose of the negative list of transactions provided by CBDT regarding the requirement of paying STT on the acquisition and transfer of equity shares?

Exempt certain transactions from taxation altogether

Identify transactions where STT payment is not mandatory

Ensure compliance with international taxation standards

None of the above
 
Q 10. In which case is a tax required to be deducted from the payment of interest to a resident person in respect of securities of the Central Government or State Government?

For all government securities

Only for Cash Management Bills

Only for Treasury Bills

Only for specific savings bonds
 
Q 11. In Scenario 1, what was the amount of interest incurred by XYZ Ltd.?

- Rs. 40,000

- Rs. 50,000

- Rs. 60,000

- Rs. 80,000
 
Q 12. What is the valuation method prescribed by ICDS-II for inventories in case of dissolution of a partnership firm or AOP or BOI?

Market value on the date of dissolution

Historical cost

Net realizable value on the date of dissolution

None of the above
 
Q 13. Under what circumstances is profit arising from the sale of securities chargeable to tax under the head "Profits and gains of business or profession"?

If securities are held as an investment

If securities are government securities

If securities are held as stock-in-trade

None of the above
 
Q 14. What is the consequence regarding MAT credit if it relates to the difference between foreign tax credits allowed against MAT and taxes computed under regular provisions?

MAT credit can be carried forward indefinitely

MAT credit cannot be carried forward

MAT credit can only be carried forward for 5 years

MAT credit can only be carried forward for 15 years
 
Q 15. According to the SEBI (FPI) Regulations, 2019, what amendment has been made to Section 9 of the Income-tax Act, 1961 regarding the relaxation of indirect transfer of capital assets held by non-residents through investment in Category-I FPIs?

Relaxation is only available for investments in Indian securities

Relaxation is only available for investments in offshore derivative instruments

Relaxation is only available for Category-II FPIs

Relaxation is available for investments in Category-IFPIs registered under the SEBI (Foreign Portfolio Investors) Regulations, 2019

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