. . Income-tax – Page 5 – Tax Questions and Answers

Tax Questions and Answers

Category: Income-tax

  • Cash credits- Share application money

    AO has right to make addition of share application money received by the assessee in very first year of incorporation, irrespective of the fact, whether the assessee has done business or not, on the basis of proviso inserted by the Finance Act, 2012 w.e.f. April 1, 2013 i.e., assessment year 2013-14.

  • Cash credits .Receipt of Share Application Money

    No. The Supreme Court in Lovely Exports Ltd. [216 CTR 195] held that when share application money received from the shareholders whose name and PA Nos. are on record then the Assessing Officer is free to proceed to reopen the assessment of the shareholders and no addition should be made in the hands of the company. Similar observation you would find in CIT v. Steller Investment Ltd. [251 ITR 263 (SC)]

  • Clubbing of income – Spouse

    Husband has invested his own funds in house property but the property was purchased in his wife’s name. So he has transferred the property to his wife. On sale of the said property the capital gains would be chargeable in the hands of husband

  • Clubbing of income -Clubbing of income u/s. 64 and Deduction u/s. 54F

    The income will have to be computed as if it is being assessed in the hands of the spouse or minor child and then translated into the hands of other spouse or parent, as the case may be

  • Clubbing of income – HUF -Sum of money attracts section 64(2)

    Yes, Normally property has been understood in widest possible terms. The Explanation 1 to section 64(2) clarifies that the word “property” has been defined very widely. Property includes any interest in property, movable or immovable, the proceeds of sale thereof and any money or investment for the time being representing the proceeds of sale thereof and where the property is converted into any other property by any method such other property. Therefore “any sum of money” is property.

  • Income from other sources- Transfer to associated Company

    In this case, individual has transferred or sold gold for inadequate consideration on March 1, 2016 to associate company i.e. for assessment year 2016-17 therefore amended provision would not be applicable.

  • Income from other sources – Gift of shares by one company to another company

    Section 2(31) of the Income-tax Act, 1961 defines “person”, which includes a company. A company is a separate juristic entity distinct from its shareholders. Thus company is taxable entity distinct from its shareholders. Section 56(2)(viia) applies to unlisted company, so if one unlisted company receives a gift of shares of unlisted company from another unlised company this section would be applicable.

  • Income from other sources- Gift to HUF by uncle

    There is no restriction from accepting gift from your real uncle (your father’s younger brother) for your HUF consisting of yourself, your wife and children, but the same would be taxable in the hands of your HUF.

  • Income from other sources- S. 56(2)(vii) not applicable to firm – Before amendment by the Finance Act, 2017

    S. 56(2)(vii) is applicable to only individual or HUF who receives any money, an immovable property or any property, other than immovable property without consideration or for consideration which is less than the aggregate stamp duty value, if fair market value of the property or value exceeds Rs. 50,000/-.

  • Income from other sources- Stamp duty v. Purchase price

    This section is opposite of section 50C of the Act. Section 50C is applicable to seller of land or building or both, while this section is applicable to the purchaser of land or building or both.