## Response:

Here are some more MCQs based on the content:

Q1. Which of the following is not one of the main reasons for Double Taxation as
per the document?
a) A company may be resident of one country but derive income from another
country as well
b) A company may be subjected to tax on its world income in two or more
countries
c) A non-resident company may be subjected to tax in two countries on income
derived from one of them
d) A company may have to pay value-added tax (VAT) in addition to income tax in
foreign countries
A1. d) A company may have to pay value-added tax (VAT) in addition to income tax
in foreign countries
Q2. Under Section 91 of the Income Tax Act which provides unilateral relief,
which of these conditions need not be satisfied to claim the relief?
a) The person or Company has been a resident in India in the previous year
b) The same income should be gained and received by the taxpayer outside India
in the previous year
c) The person or the Company has paid taxes as per the foreign country Income
Tax Rules
d) The foreign country should have a tax treaty or agreement with India
A2. d) The foreign country should have a tax treaty or agreement with India
Q3. Under the bilateral relief provided in Section 90 of the Income Tax Act,
which of these methods is not used for providing relief from double taxation?
a) Exemption method, where a particular income is taxed in only one of the two
countries
b) Tax credit method, where the country of residence allows credit for tax
charged by the source country
c) Tax sparing method, where the country of residence allows deductions for tax
spared by source country
d) Tax relief method, where an income is taxable in both countries as per their
tax laws read with DTAA
A3. c) Tax sparing method, where the country of residence allows deductions for
tax spared by source country
Q4. Which anti-avoidance doctrine requires the taxpayer to justify the business
reasons for entering into a particular transaction?
a) Substance over form rule
b) Business purpose rule
c) Controlled Foreign Corporation rule
d) Place of Effective Management rule
A4. b) Business purpose rule
Q5. Which of these best describes the OECD Model Tax Convention?
a) It favors capital-importing countries over capital-exporting countries
b) It imposes fewer restrictions on the taxing rights of the source country
compared to the UN model
c) It favors capital-exporting countries and requires source country to give up
some tax on certain incomes
d) It was devised by developing countries as the OECD model was not appropriate
for them
A5. c) It favors capital-exporting countries and requires source country to give
up some tax on certain incomes

## Response:
The MCQs provided so far cover a significant portion of the material, but there
are still some key concepts that haven't been addressed yet. Here are a few more
MCQs to ensure more comprehensive coverage:
Q6. What is the purpose of Double Taxation Avoidance Agreement (DTAA)?
a) To impose tax on the same income twice
b) To avoid taxing the same income twice between two or more countries
c) To increase the tax rates for foreign companies
d) To provide tax exemptions to all foreign entities
A6. b) To avoid taxing the same income twice between two or more countries
Q7. Which section of the Income Tax Act provides relief to specified
associations in India that have an agreement with a specified association in a
foreign country?
a) Section 90
b) Section 90A
c) Section 91
d) Section 92
A7. b) Section 90A
Q8. What is the purpose of the Base Erosion and Profit Shifting (BEPS)
initiative?
a) To facilitate tax avoidance strategies by multinational companies
b) To tackle tax avoidance strategies that exploit gaps and mismatches in tax
rules
c) To increase the tax rates for multinational companies
d) To provide tax exemptions to multinational companies
A8. b) To tackle tax avoidance strategies that exploit gaps and mismatches in
tax rules
Q9. What is the General Anti-Avoidance Rule (GAAR)?
a) A rule that promotes aggressive tax planning
b) A tool for checking aggressive tax planning and transactions entered into
with the objective of avoiding tax
c) A rule that provides tax exemptions to certain transactions
d) A rule that applies only to domestic companies
A9. b) A tool for checking aggressive tax planning and transactions entered into
with the objective of avoiding tax
Q10. What is the significance of the Place of Effective Management (POEM)
concept?
a) It determines the residential status of a foreign company for tax purposes in
India
b) It is used to provide tax exemptions to foreign companies
c) It is a type of tax avoidance strategy
d) It is used to determine the tax rates for foreign companies
A10. a) It determines the residential status of a foreign company for tax
purposes in India
These additional MCQs, along with the previous ones, should provide a fairly
comprehensive coverage of the material provided.