Which of the following statements is correct regarding the taxation of income under the Income-tax Act, 1961?

CA Intermediate · Taxation · MTP · January 2026
Which of the following statements is correct regarding the taxation of income under the Income-tax Act, 1961?
(A) Income from agricultural operations on land situated outside India is exempt from income-tax.
(B) Under the default tax regime, all deductions under Chapter VI-A are allowed.
(C) Income of a previous year is always assessed in the immediately following assessment year.
(D) Unexplained credits or investments not satisfactorily explained to the Assessing Officer may be treated as income and taxed accordingly

Suggested Answer and Working Notes:

Correct Answer: Option (D)

Unexplained credits or investments not satisfactorily explained to the Assessing Officer may be treated as income and taxed accordingly

Topics: Paper 3A: Income Tax Laws

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