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
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
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.
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.
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.
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.
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/-.
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.
||A’s HUF consists of karta A and Members Mrs. A, S-1 and D-1. The HUF derives income of ₹ 3 lakhs as interest on FD with bank and agri. income of ₹ 10 lakhs.
Now HUF can make a reasonable gift to its members. Also income received by a member out of the HUF income is also exempt u/s. 10 (2).
What are the tax implications of receiving gift in the hands of member taking into account provisions of Sec. 10 (2) and Section 56 (2) (x) ?
It appears that there would be no liability in the hands of member concerned u/s. 56(2)(x) since the income itself is exempt u/s. 10(2). Is it correct?
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||CA. H. N. Motiwalla
||Income from other sources- Gift by HUF
S. 56(2)(vii) was applicable up to March 31, 2017
A gift by a member to HUF is not taxable as per section 56(2)(vii) read with Explanation to section 56(2)(x).