Test Booklet Code & Serial No.

A
COMMERCE
Signature and Name of Invigilator Seat No.
1. (Signature) ......................................... (In figures as in Admit Card)
(Name) ................................................ Seat No. ..............................................................
2. (Signature) ......................................... (In words)

(Name) ................................................ OMR Sheet No.

JAN - 50318 (To be filled by the Candidate)
Time Allowed : 2½ Hours] [Maximum Marks : 150
Number of Pages in this Booklet : 40 Number of Questions in this Booklet : 75
Instructions for the Candidates
1. Write your Seat No. and OMR Sheet No. in the space provided 1.
on the top of this page.
2. This paper consists of 75 objective type questions. Each question
will carry two marks. All questions of Paper-III will be compulsory, 2.
covering entire syllabus (including all electives, without options).
3. At the commencement of examination, the question booklet
will be given to the student. In the first 5 minutes, you are
requested to open the booklet and compulsorily examine it as 3.
follows :
(i) To have access to the Question Booklet, tear off the
paper seal on the edge of this cover page. Do not accept
(i)
a booklet without sticker-seal or open booklet.
(ii) Tally the number of pages and number of questions
in the booklet with the information printed on the (ii)
cover page. Faulty booklets due to missing pages/
questions or questions repeated or not in serial
o rder or any other discre pancy should not be
accepted and correct booklet should be obtained
from the invigilator within the period of 5 minutes.
Afterwards, neither the Question Booklet will be
replaced nor any extra time will be given. The same
may please be noted.
(iii) After this verification is over, the OMR Sheet Number
should be entered on this Test Booklet. (iii)
4. Each question has four alternative responses marked (A), (B),
(C) and (D). You have to darken the circle as indicated below on
the correct response against each item. 4. (A), (B), (C) (D)
Example : where (C) is the correct response.

A B D
(C)
5. Your responses to the items are to be indicated in the OMR
Sheet given inside the Booklet only. If you mark at any place A B D
other than in the circle in the OMR Sheet, it will not be evaluated.
5.
6. Read instructions given inside carefully.
7. Rough Work is to be done at the end of this booklet.
8. If you write your Name, Seat Number, Phone Number or put 6.
any mark on any part of the OMR Sheet, except for the space 7.
allotted for the relevant entries, which may disclose your 8.
identity, or use abusive language or employ any other unfair
means, you will render yourself liable to disqualification.
9. You have to return original OMR Sheet to the invigilator at the
end of the examination compulsorily and must not carry it with 9.
you outside the Examination Hall. You are, however, allowed
to carry the Test Booklet and duplicate copy of OMR Sheet on
conclusion of examination.
10. Use only Blue/Black Ball point pen. 10.
11. Use of any calculator or log table, etc., is prohibited. 11.
12. There is no negative marking for incorrect answers. 12.
 JAN - 50318/III—A

2
 JAN - 50318/III—A
COMMERCE
Paper III

III
Time Allowed : 2½ Hours] [Maximum Marks : 150
Note : This paper contains Seventy Five (75) multiple choice questions. Each
question carrying Two (2) marks. Attempt All questions.
(75) (2)

1. A medium enterprise is an 1.
enterprise where investment limit in
plant and machinery is ..............

(A) ` 7.5 crores (A) ` 7.5

(B) ` 5 crores (B) ` 5

(C) ` 10 crores (C) ` 10

(D) ` 20 crores (D) ` 20

2. The scope of MRTP Act, since 1992 2. 1992

has been confined only to the
regulation of :

(A) Consumer monopolies (A)

(B) Restrictive and unfair trade (B)

practices

(C) Restrictive Trade Practices (C)

(D) Monopolistic Trade Practices (D)

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 JAN - 50318/III—A

3. Which one of the following cannot 3. 24 1991

be considered as one of the salient
features of major changes
announced in industrial policy on 24
July, 1991 ?

(A) Delicensing with certain

(A)
exception

(B) Liberalisation of Foreign

Investment and technological (B)
participation

(C) Effective promotion of small

industries widely dispersed in (C)

rural areas and small towns

(D) Scraping of MRTP regulation

(D)
pertaining to concentration of
economic power

4. Which one of the following is not 4.

a technique of environmental
analysis ?
(A)
(A) Verbal or written information

(B) Spying (B)

(C) Networking (C)

(D) Forecasting and formal
(D)
studies
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 JAN - 50318/III—A

5. Which of the following factors should 5.

not be considered in a make or buy

decision ?

(A) Potential use of manufacturing

capacity (A)

(B) Variable cost of production (B)

(C) Potential rental income from

(C)
space occupied by production

area

(D)
(D) Uncharged fixed cost

6. A budget that gives a summary of 6.

all the functional budgets and a

projected profit and loss account is

known as ..........
(A)
(A) Master Budget
(B)
(B) Capital Budget

(C)
(C) Flexible Budget

(D) Fixed Budget (D)

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 JAN - 50318/III—A

7. Which of the following is not a 7.

responsibility centre ?
(A)

(A) Expense centre

(B)
(B) Profit centre

(C)
(C) Investment centre

(D)
(D) Control centre

8. Which of the following methods of 8.

depreciation is recognised for income

tax purposes ?
(A)
(A) Straight line method

(B)
(B) Annuity method

(C) Written down value method (C)

(D) Revaluation method (D)

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 JAN - 50318/III—A

9. If the cross elasticity of demand for 9.

two goods is negative, then they

are :
(A)
(A) Complements

(B)
(B) Substitutes

(C)
(C) Luxuries

(D) Consumer goods (D)

10. Other factors remaining unchanged, 10.

if the income of the buyer increases,

his budget/price line will :

(A)
(A) Shift backwards to the left

(B)
(B) Remains unchanged

(C) Shifts upwards to the right (C)

(D) Becomes vertical (D)

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 JAN - 50318/III—A

11. Which of the following formulas can 11.

be used to calculate Marginal

Utility (MU) ?

(A) TU/N
(A) TU/N

(B) TU – AU
(B) TU – AU

(C) AU × N
(C) AU × N

(D) TUn – TUn–1 (D) TUn – TUn–1

12. When the marginal cost (MC) of a 12.

firm is rising, it will :

(A)

(A) pull the average cost (AC) up

(B)

(B) push the AC down

(C)

(C) split the AC

(D)

(D) leave the AC unaffected

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 JAN - 50318/III—A

13. To test whether the two population 13.

means are equal we use ........... test.

(A) t (A) t

(B) F (B) F

(C) Chi square (C) (Chi-square)

(D) Kolmogorov-Smirnov (D)

14. Sampling distribution of a statistic 14.

will be approximately normal when

(Statistic)

the sample size is ............

(A)
(A) Small

(B)
(B) Large

(C)
(C) Sufficiently large

(D) Optimum (D)

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 JAN - 50318/III—A

15. In a pie diagram, 5 percent is equal 15. 5%

to ............ degree angle.

(A) 3.0 (A) 3.0

(B) 4.5 (B) 4.5

(C) 9.0 (C) 9.0

(D) 18.0 (D) 18.0

16. The standard deviation of a 16.

binomial distribution is ............

(A) np (A) np

(B) npq (B) npq

(C) npq (C) npq

(D) np2 q2 (D) np2 q2

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17. ................... is not a component of 17.

planning.

(A) Policy (A)

(B) Programme (B)

(C) Delegation of authority (C)

(D) Tactic (D)

18. ............. is a step in the process of 18.

controlling.

(A) Decentralisation of Authority (A)

(B) Setting standard

(B)

(C) Determining span of control

(C)

(D) Developing feedback control

(D)

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 JAN - 50318/III—A

19. ............ is not a part of the 19.

organisational structure.

(A) Committee (A)

(B) Matrix organisation (B)

(C) Informal organisation (C)

(D) Centralisation of authority (D)

20. ............ is a part of the process of 20.

communication.

(A) Strategy formulation (A)

(B) Policy formulation (B)

(C) Decoding (C)

(D) Situation identification (D)

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21. Selling concept focuses on the needs 21.

of sellers, while marketing concept

focuses on the needs of .............

(A) Dealers (A)

(B) Suppliers (B)

(C) Buyers (C)

(D) Distributors (D)

22. A mass communication programme 22.

about a product or an organisation,

for which no payment is made, is

called as ...........

(A) Publicity (A)

(B) Advertising (B)

(C) Salesmanship (C)

(D) Sales Promotional Schemes

(D)

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 JAN - 50318/III—A

23. Niche marketing refers to marketing 23.

of products and services to a .............

group of buyers.
(A)
(A) Large

(B)
(B) Small

(C)
(C) Substantial

(D) Diversified (D)

24. Initially charging the high price and 24.

then gradually reducing the same

after some time period, is called

as .............

(A)
(A) Skimming Pricing Policy

(B)
(B) Penetration Pricing Policy

(C) Uniform Pricing Policy (C)

(D) Unique Pricing Policy (D)

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25. From the following details of project 25.

A, calculate pay back period.

Cost of project ` 80,000, estimated ` 80,000,

scrap value ` 10,000, estimated cash ` 10,000,

inflow (savings) :

` `

1 year 16,000 1 16,000

2 year 24,000 2 24,000

3 year 24,000 3 24,000

4 year 24,000 4 24,000

5 year 12,000 5 12,000

(A) 3 years, 8 months (A) 3 8

(B) 3 years, 3 months (B) 3 3

(C) 5 years, 8 months (C) 5 8

(D) 5 years, 3 months (D) 5 3

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 JAN - 50318/III—A

26. From the following information, 26.

calculate operating leverage :

Sales ` 2,00,000, contribution

` 2,00,000, ` 1,00,000,
` 1,00,000; Fixed cost ` 50,000,
` 50,000,
Earnings before interest and tax
(EBIT) : ` 50,000.
(EBIT) : ` 50,000.
(A) 2
(A) 2

(B) 1
(B) 1

(C) 0.50 (C) 0.50

(D) 0.25 (D) 0.25

27. Which one of the following is not 27.

used to estimate cost of equity

capital ?

(A) External yield criterion (A)

(B) Dividend plus growth model (B)

(C) Equity capitalization approach (C)

(D) Capital Asset Pricing Model (D)

(CAPM)

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28. The debt policy of a firm is 28.

significantly influenced by the ...........

(A) Cost concept (A)

(B) Cost consideration (B)

(C) Cost capital (C)

(D) Cost control (D)

29. Working conditions are a part of : 29.

(A) Job environment (A)

(B) Job enlargement (B)

(C) Job evaluation (C)

(D) Job enrichment (D)

30. Provisions relating to health and 30.

safety in industrial organisations are

there in the ...............

(A)
(A) Industrial Disputes Act

(B)
(B) Workmen’s Compensation Act

(C) Factories Act (C)

(D) ESI Act (D)

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 JAN - 50318/III—A

31. Sound Human Resource Manage- 31.

ment requires understanding of

(n/PWR), (n/AFF)
n /PWR, n /AFF and n /ACH
(n/ACH)
developed by :

(A) Skinner (A)

(B) McClelland (B)

(C) Adams (C)

(D)
(D) Vroom

32. Which of the following is usually 32.

not an approach to on-the-job

training ?
(A)
(A) Coaching

(B)
(B) Job rotation

(C) Planned progression (C)

(D) Sensitivity training (D)

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 JAN - 50318/III—A

33. By mobilizing savings and lending 33.

them as credit, banks act as :

(A) Capital Market (A)

(B) Financial Intermediaries (B)

(C) Forex Dealer (C)

(D) Lender of last resort (D)

34. Which among the following is 34.

incorrect ?
(A)

(A) RBI is the Bank of Issue

(B) RBI acts as Banker to the

(B)
Government

(C)
(C) RBI is Banker’s Bank

(D) RBI is lender to the large (D)

industrial corporations

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 JAN - 50318/III—A

35. Basel II accord is mostly concerned 35.

with :

(A) Central Vigilance Commission (A)

(B) Non-performing Assets (B)

(C) Capital Adequacy Ratio (C)

(D) Foreign Direct Investment (D)

36. Banking Ombudsman means :

36.

(A) A person appointed to recover

(A)
dues

(B) A person to whom customer can (B)

approach for redressal of his

grievances

(C)
(C) A person appointed to settle

disputes between employees and

management
(D)
(D) A person appointed by RBI to

oversee the functioning of

foreign banks

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 JAN - 50318/III—A

37. Which of the following has the 37.

highest percentage share in Indian

imports ? (A)

(A) Petrol (B)

(B) Gas (C)

(C) Diesel (D) (Petrol, oil and

(D) POL (Petrol, oil and lubricants) lubricants)

38. Special Drawing Rights are : 38. (SDRs)

(A) International Reserve Assets

(A)

(B) Indian Regulatory Authority

(B)

(C) International Regional Assets (C)

(D) Component of FDI (D)

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 JAN - 50318/III—A

39. World Bank can grant loans to its 39.

member country upto : (A)

10
(A) 10% of its share in paid up

capital of World Bank (B)

20
(B) 20% of its share in paid up

capital of World Bank

(C)

(C) 30% of its share in paid up 30

capital of World Bank

(D)
(D) 40% of its share in paid up 40

capital of World Bank

40. Balance of trade takes into 40. (BOT)

account :

(A) Only export and import of

services (A)

(B) Export and import of goods and

(B)
services

(C) Export and import of capital

(C)

(D) Export and import of only

merchandise goods (D)

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 JAN - 50318/III—A

41. The marketing manager of a product 41.

line is the example of .............

(A) Cost Centre (A)

(B) Revenue Centre (B)

(C) Investment Centre (C)

(D) Profit Centre (D)

42. Accounting Standard-16 is related 42. 16

with ............

(A) Segment reporting (A)

(B) Amalgamation (B)

(C) Borrowing cost (C)

(D) Depreciation accounting (D)

43. Which of the following risk area is 43.

not considered before venture capital

financing ?

(A) Product risk (A)

(B) Market risk (B)

(C) Dividend risk (C)

(D) Technological risk (D)

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 JAN - 50318/III—A

44. Cartel is a type of ............... 44.

(A) Vertical combinations (A)

(B) Allied combinations (B)

(C) Horizontal combinations (C)

(D) Mixed combinations (D)

45. When a right to purchase securities 45.

is acquired, it is known as ............

(A) Call option (A)

(B) Put option (B)

(C) Double option (C)

(D) Option (D)

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 JAN - 50318/III—A

46. Foreign equity includes ........ 46.

(A) ADR’s (American Depository

Receipts) (A)

(B) Bonds (B)

(C) Commercial Papers (C)

(D) Gold bonds (D)

47. The first mutual fund scheme in 47.

India was introduced by ..............

(A) Reserve Bank of India (RBI) (A)

(B) State Bank of India (SBI) (B)

(C) Unit Trust of India (UTI) (C)

(D) Government of India (D)

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 JAN - 50318/III—A

48. Market segmentation is a process of 48.

taking the total heterogenous

market for a product and dividing

it into several segments each of

which tends to be ............. in all

significance.
(A)

(A) Different
(B)
(B) Special
(C)
(C) Homogeneous

(D)
(D) Indigeneous

49. In sellers’ market situation, ............... 49.

dominate the decisions and activities

in the market.

(A) Manufacturers and dealers

(A)
(B) Consumers
(B)
(C) Competitors
(C)
(D) Banks and Insurance

Companies (D)

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 JAN - 50318/III—A

50. Which of the following is not

50.

included in the micro-environmental

factors ?

(A) Customers (A)

(B) Dealers (B)

(C) Competitors
(C)
(D) Other departments in the

(D)
company

51. Out of the following which is not 51.

included as a personal factor

influencing consumers’ buying

behaviour ?
(A)
(A) Occupation

(B)
(B) Lifestyle

(C)
(C) Age

(D) Social group (D)

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 JAN - 50318/III—A

52. Green products are those products 52.

which ..................
(A)
(A) are packed only in green

coloured paper

(B) include raw materials in green (B)

colour only

(C) try to protect the environment

(C)
(D) are the products harmful to
(D)
environment

53. Day to day buying of fruits and 53.

vegetables by the consumers

indicates an example of ............

buying behaviour.
(A)
(A) Variety seeking

(B) Complex decision-making (B)

(C) Special (C)

(D) Brand Loyal

(D)

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 JAN - 50318/III—A

54. For the distribution of toilet soaps 54.

.................. distribution strategy is

preferred.
(A)
(A) Intensive
(B)
(B) Selective

(C)
(C) Exclusive

(D)
(D) Inclusive

55. Which of the following is not the 55.

method of workers’ participation in

management ?
(A)

(A) Co-partnership
(B)

(B) Profit-sharing

(C)
(C) Member on Board of Directors

(D)
(D) Bonus Scheme

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 JAN - 50318/III—A

56. Under whose plan workers who 56.

produce alone standards receive

higher wages than those who

produce below standards ?

(A) Fayol
(A)

(B) Taylor
(B)

(C) Follet (C)

(D) Halsey-Rowan (D)

57. ............... is constructed/designed to 57.

discover interests, existing skills and

potential for acquiring skills.

(A) Intelligence Test (A)

(B) Proficiency Aptitude Test (B)

(C) Vocational Test (C)

(D) Personality Test (D)

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 JAN - 50318/III—A

58. Which one of the following is not 58.

non-financial incentive ?

(A) Giving additional responsibility (A)

(B) Creating a sense of achievement (B)

(C) Granting recognition (C)

(D) Declaring bonus (D)

59. The blocking of goal-attainment is 59.

referred to as :

(A) Perception (A)

(B) Goal congruence (B)

(C) Frustration (C)

(D) Dissonance (D)

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 JAN - 50318/III—A

60. Instead of searching for the perfect 60.

or ideal decision, managers
frequently settle for one that will
adequately serve their purpose. In
Simon’s terms, they :
(A)
(A) Optimise

(B) Maximise (B)

(C) Satisfice (C)

(D) Actualise (D)

61. The following are the basic human 61.

needs mentioned by Maslow :

(i) Physiological needs (i)

(ii) Esteem needs (ii)

(iii) Security needs (iii)
(iv) Self-actualisation needs
(iv) (Self-actualisation)
(v) Affiliation needs
(v)
The ascending order of these as done
by Maslow would be :
(A) (i), (ii), (iii), (v), (iv)
(A) (i), (ii), (iii), (v), (iv)
(B) (i), (iii), (v), (ii), (iv)
(B) (i), (iii), (v), (ii), (iv)
(C) (i), (v), (ii), (iv), (iii)
(C) (i), (v), (ii), (iv), (iii)
(D) (i), (iii), (iv), (v), (ii)
(D) (i), (iii), (iv), (v), (ii)
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 JAN - 50318/III—A

62. In Indian context TRIPS will have 62.

its greatest impact on :

(A) Automobile
(A)

(B) Banking and insurance

(B)

(C) Pharmaceuticals (C)

(D) Aviation (D)

63. Which of the following is not agreed 63.

upon by members of WTO ?

(A) Observance of minimum labour

standard
(A)

(B) Protection of Intellectual

(B)
Property Rights

(C)
(C) Dispute Settlement Mechanism

(D) Agricultural Subsidies (D)

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 JAN - 50318/III—A

64. Which of the following was 64.

established to help and finance

world’s less developed countries ?

(A) IMF (A)

(B) IBRD (B)

(C) IDA (C)

(D) RBI (D)

65. Which of the following is not a major 65.

trading partner of India ?

(A) UAE (A)

(B) China (B)

(C) Germany (C)

(D) Finland (D)

66. Global depository receitps are issued 66. (GDRs)

by :

(A) America (A)

(B) Depository Country (B)

(C) Depository Bank (C)

(D) Investors (D)

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 JAN - 50318/III—A

67. Removal of restrictions on payments

67.

relating to import and exports of

goods, services and factor income is

called as : (A)

(A) Trade Liberalism

(B)

(B) Free Trade

(C)
(C) Current Account Convertibility

(D)
(D) Trade Promotion

68. SAFTA is related to : 68.

(A) UN (A)

(B) EU (B)

(C) SAARC (C)

(D) ASEAN (D)

35 [P.T.O.
 JAN - 50318/III—A

69. Under Income Tax Act 1961 a status

69.

of foreign University having campus

1961
in India is ............

(A)
(A) Company

(B)
(B) Association of Person

(C) Artificial Judicial Person (C)

(D) Trust (D)

70. Which of the following allowances is

70.

fully exempted under the Income

Tax Act, 1961 ?

(A)
(A) Travelling allowance

(B)
(B) Conveyance allowance

(C)
(C) Hostel allowance

(D) Uniform allowance (D)

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 JAN - 50318/III—A

71. Maximum deduction u/s 24 of 71.

Income Tax Act 1961 in respect of

1961

interest on borrowed capital for

24
repairs of the house property is

restricted to ..............
(A) ` 30,000
(A) ` 30,000 p.a.

(B) ` 1,50,000
(B) ` 1,50,000 p.a.

(C) ` 2,00,000
(C) ` 2,00,000 p.a.

(D) ` 50,000 p.a. (D) ` 50,000

72. Long-term capital gain taxable in 72.

the hands of an individual assessee

at the rate of ...............

(A) 20%
(A) 20%

(B) 15%
(B) 15%

(C) 25% (C) 25%

(D) Relevant slab rates (D)

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 JAN - 50318/III—A

73. Due date of filing return of income

73.
by a non-corporate assessee having
tax audit is ..............

(A) 30th June of the relevant

Assessment Year
(A) 30
(B) 31st July of the relevant
Assessment Year
(B) 31
(C) 30th Sept. of the relevant
Assessment Year (C) 30

(D) 31st Oct. of the relevant

(D) 31
Assessment Year
74.
74. Suppression of Income is an example
of .............

(A) Tax Planning (A)

(B) Tax Avoidance (B)

(C) Tax Exemption (C)

(D) Tax Deduction (D)

75. Rate of tax deducted at source for 75.

interest on fixed deposits exceeding ` 10,000
` 10,000 for the assessee not
providing Permanent Account
Number is .............

(A) 10% (A) 10%

(B) 20% (B) 20%

(C) 30% (C) 30%
(D) relevant slab rate of tax
(D)

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ROUGH WORK

39 [P.T.O.
 JAN - 50318/III—A

ROUGH WORK

40