Clubbing provisions

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 February 2015 If lady transfers to her father in law rs 5 Lac, and father in law deposits RS. 5 Lac in Bank A/c as fd on which interest received is RS. 50,000. then in whose income it will be added?

CA NAVEEN SINGLA

CA NAVEEN SINGLA (Expert)
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03 February 2015 It would be clubbed in the Income of lady as Deposit of FD is not due to the skill of Father in Law

Querist : Anonymous

Querist : Anonymous (Querist)

03 February 2015 But tds deducted on interest income will be shown in father in law's 26 as then how can we show such interest in lady income ? or we can say that lady will not be able to be get benfit by such tds.

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CA NAVEEN SINGLA

CA NAVEEN SINGLA (Expert)
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04 February 2015 No Both lady and Father in law would file the ITR. TDS deducted on FD would be claimed by FIL by showing Nil Income.

Lady would pay the Tax on Interest Income.

CA NAVEEN SINGLA

CA NAVEEN SINGLA (Expert)
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04 February 2015 Sorry for my earlier replies by further study I have found that Such Income would be taxed in the income of FIL however the clubbing Rule would be reversed if FIL gift to her DIL.

Querist : Anonymous

Querist : Anonymous (Querist)

05 February 2015 it means originally, there will be no clubbing in 1st case.Both interest income and tds will be shown in FIL's ITR.

Clubbing would be reversed?Please expand.I didn't get your point as there is no clubbing so how it can be reversed?

CA NAVEEN SINGLA

CA NAVEEN SINGLA (Expert)
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06 February 2015 Reversed means If FIL gift to her DIL. the Clubbing of Income Would be there as per section 64 of IT Act.

Clubbing would not be there in our case as DIL has gifted to FIL.

Querist : Anonymous

Querist : Anonymous (Querist)

07 February 2015 The treatment will be same if lady transfers to her spouse and spouse further transfers that amount i.e. Rs 5 Lac to his father and father deposits as fd and get interest?

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Querist : Anonymous

Querist : Anonymous (Querist)

07 February 2015 The treatment will be same if lady transfers to her spouse and spouse further transfers that amount i.e. Rs 5 Lac to his father and father deposits as fd and get interest?