CMA VIPUL SHAH TEST HOUSE PROPERTY

HOUSE PROPERTY

Q 1. Mr. Vipul is having a plot of land. He has let out this to earn some extra income.
Rent of plot of land will be taxable as
(a) Income from house property
(b) Income from Business and profession
(c) Income from other sources
(d) Any of the above at the choice of Mr. Vipul.
Q 2. Treatment of unrealized rent for determining income from house property
(a) To be deducted from expected rent
(b) To be deducted from actual rent
(c) To be deducted under section 24 from annual value
(d) To be deducted from both expected rent and actual rent

Q 3. Municipal taxes to be deducted from GAV should be

(a) Paid by the tenant during the previous year
(b) Paid by the owner during the previous year
(c) Accrued during the previous year
(d) Paid during the previous year either by tenant or owner

Q 4. Deduction under section 24(a) is

(a) 1/3rd of NAV
(b) repairs actually incurred by the owner
(c) 30% of NAV
(d) Interest on borrowed capital

Q 5. Interest on borrowed capital accrued up to the end of the previous year prior to the
year of completion of construction is
(a) allowed as a deduction in the year of completion of construction
(b) allowed in 5 equal annual installments from the year of completion of construction
(c) allowed in the respective year in which the interest accrues
(d) not allowed

Q 6. The ceiling limit of deduction under section 24(b) in respect of interest on loan taken
on 1/4/2020 for repairs of a self-occupied house for AY 2021-2022 i.e. PY 2020-
2021

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(a) Rs. 30,000 p.a.
(b) Rs. 1,50,000 p.a.
(c) Rs. 2,00,000 p.a.
(d) No limit

Q 7. Where an assessee has two house properties for self-occupation, the benefit of NIL
annual value will be available in respect of—
(a) Both the properties
(b) The property which has been acquired/ constructed first
(c) Any one of the properties, at the option of the assessee
(d) Any one of the properties and once option is exercised cannot be changed in subsequent
years

Q 8. Mr. Vipul received Rs. 90,000 in May, 2019 towards recovery of unrealised rent,
which was deducted from actual rent during the PY 2016-2017 for determining
annual value. Legal expense incurred in relation to unrealized rent is Rs. 20,000. The
amount taxable under section 25A for AY 2021-2022 i.e. PY 2020-2021 would be—
(a) Rs. 70,000
(b) Rs. 63,000
(c) Rs. 60,000
(d) Rs. 49,000

Q 9. Mr. Vipul and Mr. Shah are co-owners of a self- occupied property. They own 50%
share each. The interest paid by each co-owner during the previous year on loan
(taken for acquisition of property during the year 2004) is Rs. 2,05,000 each. The
amount of allowable deduction in respect of each co-owner is—
(a) Rs. 2,05,000
(b) Rs. 1,02,500
(c) Rs. 2,00,000
(d) Rs. 1,00,000

Q 10. Mr. Vipul has taken a house on rent and sublets the same to Mr. Anil. Income of
Mr. Vipul from such house property shall be taxable under the head:
(a) income from house property
(b) income from other sources
(c) income from salary
(d) shall not be taxed at all

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Q 11. Mr. Vipul owns a house property which has fair rent of Rs. 1,50,000, standard rent
Rs. 1,20,000 and actual rent of 1,30,000. Municipal taxes paid during the AY 2021-
2022 i.e. PY 2020-2021 for the past 7 years is Rs. 1,40,000. The annual value
shall be:
(a) Rs. 20,000
(b) Nil
(c) Rs. (10,000)
(d) None of the above

Q 12. Municipal tax shall not include:

(a) House tax
(b) Scavenging tax
(c) State government tax
(d) Water tax

Q 13. A house property whose fair rent is Rs. 1,20,000 is vacant throughout the previous
year. Municipal taxes paid for the house property are Rs. 20,000. Its net annual
value will be:
(a) Rs. 1,20,000
(b) Nil
(c) Rs. 1,00,000
(d) Rs. 20,000

Q 14. Any person who has taken loan before 1/4/1999 for purchase or construction of
the house which is self-occupied, maximum deduction for the interest shall be:
(a) Rs. 1,20,000
(b) Rs. 30,000
(c) Rs. 2,00,000
(d) Rs. 1,50,000

Q 15. Any person who has taken loan before 1/4/1999 for repairs, renovation,
reconstruction, addition or alteration then interest allowed shall be:
(a) Rs. 20,00,00
(b) Rs. 30,000

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(c) Rs. 45,000
(d) None of the above

Q 16. Mr. Vipul borrowed Rs. 5,00,000 @ 12% p.a. on 1/4/2015 for construction of house
property which was completed on 2/4/2019. The amount of loan is still unpaid. What
will be the deduction of interest for PY 2020-2021 if the house property is let out?
(a) Rs. 30,000
(b) Rs. 96,000
(c) Rs. 1,08,000
(d) Rs. 2,40,000

Q 17. Mr. Vipul was allowed deduction of unrealized rent to the extent of Rs. 40,000 in
the past when unrealized rent was also Rs. 40,000. He is able to recover from the
tenant Rs. 35,000 as full and final settlement during the AY 2021-2022 i.e. PY
2020-2021. He is liable for tax on:
(a) Rs. 35,000
(b) Rs. 24,500
(c) Rs. 40,000
(d) Fully Exempt.

Q 18. In case the property is owned by co-owners and it is let out, income from such
property shall be computed:
(a) separately for each co-owner
(b) it will be first computed ignoring the co- ownership and then distributed amongst
coowners.
(c) Shall not be calculated at all

Q 19. Mr. Vipul is owners of a big house which is let out at the rent of Rs. 20,000 pm.
Municipal Value of the house Rs. 15,000 pm, Fair rent Rs. 21,000 pm, Standard
rent Rs. 18,000pm and Municipal Tax paid are Rs. 5,000 pa. The HP is vacant for 2
months. Calculate GAV, NAV and HP income
(a) Rs. 2,00,000 / Rs. 1,95,000 / Rs. 3 65,000
(b) Rs. 1,05,000 / Rs. 1,50,000 / Rs. 2,00,000
(c) Rs. 2,40,000 / Rs. 1,95,000 / Rs. 2,35,000
(d) Rs. 2,40,000 / Rs. 60,000 /11,26,000

Q 20. Mr. V took loan from a bank for Rs. 1,00,000 on 1/1/2016 @ 12% pa for the
construction of the house which is self-occupied. Construction of the house got
completed on 1/1/2020 and full amount of loan was paid back on 31/1/2019.

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Compute interest allowed as deduction under section 24(b) for AY 2021-2022
i.e. PY 2020-2021.
(a) Rs. 19,400
(b) Rs. 7,4000
(c) Rs. 12,000
(d) Rs. 49,000

Q 21. Mr. V gifted his house property to his wife, Mrs. J, in 2011. She has let out the
house property @ Rs. 50,000pm. The Income from such house property will be
taxable in the hands of:
(a) Mrs. J since she is the owner of the house.
(b) Taxable for Mr. V as he will be treated as deemed owner of the house property and liable
to tax. However, income will be first computed as Mrs. J’s income and thereafter clubbed
in the income of Mr. V.
(c) Taxable for Mr. V as he will be treated as deemed owner of the house property and liable
to tax.

Q 22. Mr. V gifted his house property to his married minor daughter. The income from
such house property shall be taxable in the hands of:
(a) Taxable for Mr. V as deemed owner
(b) Taxable for Mr. V. However, it will be first computed as minor daughter’s income &
clubbed in the income of Mr. V.
(c) Taxable as income of married minor daughter

Q 23. If net annual value of the house property which is let out is negative then which
deduction shall be allowed u/s 24
(a) Section 24(a) and Section 24(b)
(b) Only Section 24(a)
(c) Only Section 24(b)
(d) Section 24(a) or Section 24(b) at the choice of assessee.

Q 24. In case the property is owned by co-owners and it is let out then income from such
property shall be computed:
(a) separately for each co-owner
(b) it will be first computed ignoring the Co- Ownership and then distributed amongst co
owners.

Q 25. If an assessee has borrowed money for purchase of a house & interest is payable
outside India. Such interest shall:

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(a) be allowed as deduction
(b) not be allowed as deduction
(c) be allowed as deduction if the tax is deducted at source
(d) be allowed as deduction if the tax is deducted at source or receiver if interest has paid
tax on it in India

Q 26. Mr. V is owner of the flat which has municipal value Rs. 45,000; fair rent Rs.
50,000; standard rent Rs. 48,000 and actual rent is Rs. 44,000 for 11 Months.
There is a vacancy of 1 month. Calculate GAV
(a) Rs. 50,000
(b) Rs. 40,000
(c) Rs. 44,000
(d) Rs. 48,000

Q 27. The municipal value determined by the municipal authority is Rs. 1,20,000 whereas
its annual rent received is Rs. 1,50,000. Municipal taxes of the house property are
Rs. 20,000 out of which Rs. 15,000 has been paid during the AY 2021-2022 i.e. PY
2020- 2021. The NAV of the house property in this case shall be
(a) Rs. 1,30,000
(b) Rs. 1,35,000
(c) Rs. 1,20,000
(d) Rs. 1,50,000

Q 28. Composite rent of let-out house property is taxable as

(a) Profits and gains from business or profession
(b) Income from other sources
(c) Income from house property
(d) Either (a) or (b) above depending upon certain conditions

Q 29. Mr. Vipul owns two house properties. First property was used half for running his
business and the other half was let-out at Rs. 40,000 per month. The second
property was wholly used as a residence by Mr. Vipul Municipal value of the two
properties was the same at Rs. 7,20,000 each per annum and municipal taxes paid
are 10%. Mr. Vipul’s income from house property for the AY 2021-2022 i.e. PY
2020-2021 will be
(a) Rs. 3,13,600
(b) Rs. 3,23,400
(c) Rs. 2,28,560
(d) Rs. 6,32,160

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Q 30. When share of each co-owner in a house property is not definite, the income from
such property shall be:
(a) Taxed equally
(b) Exempt from tax
(c) Taxed as association of persons
(d) Taxed as body of individuals

Q 31. Ms. Vipul let out a property for Rs. 20,000 per month during the AY 2021-2022 i.e.
PY 2020-2021. The municipal tax on the let-out property was enhanced
retrospectively. Hence, she paid Rs. 60,000 as municipal tax which included arrears
of municipal tax of Rs. 45,000. Her income from house property is
(a) Rs. 1,80,000
(b) Rs. 1,26,000
(c) Rs. 1,57,500
(d) Rs. 1,36,500

Q 32. Mr. Vipul acquired a property in April, 2019 for self-residential use. The loan
interest payable to State Bank of India for the AY 2021-2022 i.e. PY 2020-2021
amounts to Rs. 2,10,000. The amount eligible for deduction u/s 24(b) is
(a) Rs. 30,000
(b) Rs. 2,10,000
(c) Rs. 2,00,000
(d) Rs. 1,50,000

Q 33. When a house property is let out for a monthly rent of Rs. 25,000 during the AY
2021-2022 i.e. PY 2020-2021 and maintenance expenses by way of salary to
sweeper and watchman is Rs. 6,000 per month, the income from house property
would be:
(a) Rs. 2,28,000
(b) Rs. 2,10,000
(c) Rs. 3,00,000
(d) Rs. 2,50,000

Q 34. Mr. V is owner the House which has two floors. The ground floor is let out at Rs.
40,000 pm and first floor is self-occupied. Municipal Taxes paid for full house are

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Rs. 80,000 pa and interest on borrowed capital for full house payable is Rs. 45,000
pa. Calculate income from House Property AY 2021- 2022 i.e. PY 2020-2021.
(a) Rs2,63,000
(b) Rs. 2,85,000
(c) Rs. 2,22,500
(d) Rs. 22,500

Q 35. J Ltd. is owner of the House Property which is let out on Rent @ Rs. 60,000 pm. J
Ltd. has paid Municipal Taxes of Rs. 80,000 pa. It took a loan from bank in
Australia for purchasing this house. It has paid interest to the bank of Rs. 1,20,000
pa. Calculate House Property income if J Ltd. has not done TDS on such interest and
neither has Australian bank paid tax on this.
(a) Rs. 4,48,000
(b) Rs. 7,20,000
(c) Rs. 4,48,000
(d) Rs. 6,40,000

Q 36. Xyz LTD IS ENGANGED IN construction of residential flats. One building consisting
of 25 residential apartments was constructed and completion certificate was obtained
on 15-6-17. Out of 25 flats 5 flats remained unsold by 31-3-2020. THE RER is
30000 per month. You are required to determine IFHP.
a) Nil
b) 3,60,000
c) 18,00,000
d) 12,60,000

Q. 37 Find out the expected rent of house property A, if the following is given : Municipal
value = Rs. 70,000; Fair Rent = Rs.88,000; Standard Rent = Rs.1,12,000. Actual Rent =
Rs.1,25,000
a) Rs. 1,00,000
b) Rs. 88,000
c) Rs. 1,12,000
d) Rs. 1,25,000

Q. 38 Find out the expected rent of house property Q, if the following is given:
Municipal value = Rs.65,000; Fair Rent = Rs. 88,000; Standard Rent = Rs.60,000 Actual
Rent = Rs.1,25,000
a) Rs.65,000

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b) Rs.88,000
c) Rs.60,000
d) Rs.1,25,000

Q.39 Find the Gross Annual Value of house property of A if the following is given :
Municipal value = Rs.1,00,000; Fair Rent = Rs.1,20,000; Standard Rent = Rs. 1,50,000;
Actual Rent = Rs.1,55,000
a) Rs.1,60,000
b) Rs.1,20,000
c) Rs.1,50,000
d) Rs. 1,55,000

Q.40 Which of the following deduction are to be made from income house property?
a) Statutory deduction
b) Interest on borrowed loan
c) Both (a) & (b)
d) Option (a) but not (b)

Q. 41 The construction of a house was completed on 31st January,2021. The owner of the
house took a loan of Rs.20,00,000 @6% p.a. on 1 st May,2021. In this case the deduction
allowable for the previous year 2020-21 towards interest on borrowings is----
a) Rs.22,000
b) Rs.24,000
c) Rs.1,10,000
d) None of the above

Q.42 Sandeep purchased a house for his residential purpose after taking a loan in January,
2019. During the previous year 2020-21, he paid interest on loan Rs.2,17,000. While
computing income from house property, the deduction is allowable to the extent of____
a) Rs.30,000
b) Rs.1,00,000
c) Rs.2,17,000
d) Rs.2,00,000

Q.43 Calculate the Gross Annual value from the following details : Municipal Value –
Rs.45,000; Fair rental value – Rs.50,000; Standard rent – Rs.48,000; Actual Rent
Receivable (11 months) – Rs.46,000 Vacancy : 1 month
a) Rs.50,000

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CMA VIPUL SHAH TEST HOUSE PROPERTY
b) Rs.46,000
c) Rs.45,000
d) Rs.48,000

Q.44 Calculate the Gross Annual value from the following details : Municipal Value –
Rs.45,000; Fair rental value – Rs.50,000; Standard rent – Rs.48,000; Actual Rent
Receivable (11 months) – Rs.40,000 Vacancy : 1 month
a) Rs.50,000
b) Rs.40,000
c) Rs.45,000
d) Rs.48,000

Q. 45 Mr. Kamal had two children Sumit & Sushmita (married with Aman) of age 15 & 17
respectively & wife named Anu. In which of the following case he will not be considered as
deemed owner?
a) Transfer of property to Anu.
b) Transfer of property to Sushmita
c) Transfer of property to Sumit
d) None of the above

Q.46 What are the conditions to be fulfilled in order to claim exemption of unrealized
rent?
a) The defaulting tenant is in occupation of any other property of the assesse.
b) Steps have been take to compel him to vacate the property.
c) The tenancy in bona fide
d) Both (b) & (c)

Q.47 The net annual value of house let – out is Rs.1,00,000 & actual amount spent by the
assesse on repairs & insurance premium is Rs.20,000, the amount of deduction allowed
under section 24(a) shall be Rs._____
a) Rs.20,000
b) Rs.30,000
c) Rs.25,000
d) Rs.22,000

Q.48 Jagdhish after sale of his house property during August, 2018, received arrears of
rent amounting to Rs.40,000 on 2nd February,2020. The said income is chargeable to tax
under the head_____& the taxable income would be RS._____

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a) Income from house property; RS.28,000
b) Income from other sources; RS.28,000
c) Income from house property; RS.40,000
d) Income from other sources RS.40,000

Q. 49 XYZ Ltd. is engaged in construction of residential flats. One building consisting of

25 residential apartments was constructed & completion certificate was obtained on
15/07/2018. Out of 25 residential apartments 5 apartments remained unsold up to
31/03/2021. The expected rent of each apartment is Rs.30,000 per month. You are
required to determine Income from House property for AY 2021-22
a) NIL
b) Rs. 3,60,000
c) Rs. 18,00,000
d) Rs. 12,60,000

Q. 50 XYZ Ltd is engaged in construction of residential flats. One building consisting of 25

residential apartment was constructed & completion certificate was obtained on
15/07/2017. Out of 25 residential apartment 5 apartment remained unsold up to
31/03/2021. The expected rent of each apartment is Rs.30,000 per month. You are
required to determine Income from House property for AY 2021-22.
a) NIL
b) Rs. 3,60,000
c) Rs. 18,00,000
d) Rs. 12,60,000

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ANSWERS TO ABOVE QUESTIONS

1 c 2 b 3 b 4 c 5 b 6 a 7 A 8 b 9 c 10 b

11 c 12 c 13 C 14 b 15 b 16 c 17 b 18 b 19 a 20 b

21 C 22 b 23 c 24 b 25 C 26 c 27 b 28 d 29 b 30 D

31 B 32 c 33 b 34 a 35 A 36 d 37 a 38 c 39 d 40 c

41 c 42 d 43 b 44 d 45 b 46 d 47 b 48 a 49 a 50 d

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