XX Taxation in Securities Markets - 15
XX Taxation in Securities Markets - 15
Q 1. What is the preferred method for opening an NPS account for an eligible person?
By visiting a bank branch
By applying PFRDA directly
By visiting Points of Presence - Service Providers (POP-SP)
By applying through the Income Tax Department
Q 2. Can an individual investor who becomes a non-resident continue to hold SGBs?
No, they must sell their bonds immediately
Yes, they can continue to hold SGBs until maturity
Yes, but only if they transfer ownership to a resident individual
Yes, but they must convert their bonds into government bonds
Q 3. What does the term "Originator" refer to in the context of Securitised Debt Instruments?
Acquirer of debt or receivables from SPV
Issuer on debt securities
Holder of securities
Regulator of the securitisation process
Q 4. What category does income arising from the redemption or transfer of units of the REIT belong to?
Pass-through Income
Non-Pass-through Income
Capital Gains
Dividend Income
Q 5. How is income from capital gains computed?
By subtracting the cost of acquisition from the selling price
By subtracting the expenses incurred in connection with the transfer from the full value of consideration
By adding the cost of improvement to the full value of consideration
By subtracting the net result of all calculations from the cost of improvement
Q 6. Which type of transactions are excluded from the scope of 'transfer' under Section 47 of the Income-tax Act?
All types of transactions.
Only transactions involving money.
Only transactions involving immovable properties.
None of the above.
Q 7. According to the Securities Contracts (Regulation) Act, 1956 (SCRA), which of the following is NOT included in the definition of "Securities"?
Shares of an incorporated company
Bonds issued by a government entity
Units issued by a mutual fund scheme
None of the above
Q 8. What is the consequence of a revocable transfer of assets according to Section 61 of the Income-tax Act?
The income is included in the total income of the transferee
The income is included in the total income of the transferor
Income is exempt from taxation
The income is distributed among family members
Q 9. When will the transfer of units in the consolidating scheme of a mutual fund not be treated as a transfer for taxation purposes?
Only for equity-oriented funds
Only for debt-oriented funds
Only for hybrid funds
Only for schemes of an equity-oriented fund or schemes of a fund other than an equity-oriented fund
Q 10. What expenditure is NOT deductible when computing short-term capital gains?
Expenditure incurred wholly and exclusively in connection with the transfer
Cost of acquisition
Cost of improvement
Capital gains taxable under Section 45(4) attributable to remaining assets after reconstitution
Q 11. Can a long-term capital loss be set off against income taxable under any other head?
Yes
No
Only if the loss is substantial
Only if the taxpayer is a corporation
Q 12. What happens if the net result under the head of income is a loss after intra-head adjustment?
The loss is ignored
The loss is carried forward indefinitely
Losses can be set off against income from other heads in the same previous year
Taxpayers must apply for special permission to carry forward the loss
Q 13. Which of the following best describes Exchange-Traded Funds (ETFs)?
Investment funds that trade only once a day
Funds that are not listed on any exchange
Funds that track indexes and trade like stocks
Funds that are managed by individual investors
Q 14. When is an artificial juridical person considered a resident in India?
If its directors are Indian citizens
If it has subsidiaries in India
If its Place of Effective Management (POEM) is in India
If it operates in regulated industries in India
Q 15. How are Non-Performing Assets (NPAs) managed by Asset Reconstruction Companies (ARCs)?
By liquidating the assets immediately
By issuing security receipts to Qualified Buyers
By transferring NPAs to the RBI
By acquiring NPAs at a higher price
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