Gift by HUF
shrikant (CA) (178 Points)
24 January 2020And will it be treated as other income in the hands of receipient as gift received from HUF?
shrikant (CA) (178 Points)
24 January 2020
Roshni
(Studwnt)
(1141 Points)
Replied 24 January 2020
Kapadia Pravin
(17259 Points)
Replied 24 January 2020
Roshni
(Studwnt)
(1141 Points)
Replied 24 January 2020
CA. Rohan Somani
(Chartered Accountant)
(94 Points)
Replied 24 January 2020
U/s 56(2) "relative" means,—
(i) in case of an individual—
(A) spouse of the individual;
(B) brother or sister of the individual;
(C) brother or sister of the spouse of the individual;
(D) brother or sister of either of the parents of the individual;
(E) any lineal ascendant or descendant of the individual;
(F) any lineal ascendant or descendant of the spouse of the individual;
(G) spouse of the person referred to in items (B) to (F); and
(ii) in case of a Hindu undivided family, any member thereof;
Vice Versa is not true. In the definition of relative for individual it is not given that HUF in which he is member is Relative for that individual.
So, If Individual receives any gift from HUF may not be Exempt u/s 56(2). As Definition is not clear.
Roshni
(Studwnt)
(1141 Points)
Replied 24 January 2020
FCA surbhi jain
(FCA)
(897 Points)
Replied 24 January 2020
as per sec 56(2), relative does not include HUF as a relative.. instead its member is treated as relative in which he is the member. so transfer of shares to its members cannot be exempted under sec 56(2).
Roshni
(Studwnt)
(1141 Points)
Replied 24 January 2020
shrikant
(CA)
(178 Points)
Replied 24 January 2020
What about taxability in the hands of HUF on trasnfer of shares in the form of gift. Capital Gain?
Roshni
(Studwnt)
(1141 Points)
Replied 24 January 2020
CA. Rohan Somani
(Chartered Accountant)
(94 Points)
Replied 24 January 2020
Originally posted by : Roshni | ||
@ CA Rohan somani that's true...other side of it is if not gift it will be a partial partition on which no tax implications exists. |
There is no Partial Partition in HUF. there are only 2 thing: 1. Patition 2. No Partition.
Therefore, if Asset is transferred to Member of HUF without consideration otherwise than by Partition then it will be taxable in the the hands of Transferee (Member of HUF).
rama krishnan
(12239 Points)
Replied 24 January 2020
Kapadia Pravin
(17259 Points)
Replied 24 January 2020
CA. Rohan Somani
(Chartered Accountant)
(94 Points)
Replied 25 January 2020
@ Kapadia Pravin
"There is a view in one of above post that it will be taxable in the hands of Transferee (Member of HUF) but taxable as what ?"
See, you have to look into Sec. 56(2). It is taxable in the hands of Transferee (Member of HUF) if Transfer took place otherwise than by Partition. There are 5 types of category may be created to understanding of taxability of Gift under Other source:
(a) Monetary Gift
(b) Immovable Property (Without Consideration)
(c) Immovable Property (Without Adequate Consideration)
(d) Movable Property as capital assets (Without Consideration)
(e) Movable Property as capital assets (Without Adequate Consideration)
Accordingly we have to check GIFT Received AS WHAT it is Taxable under the Head Other Source.
Kapadia Pravin
(17259 Points)
Replied 25 January 2020
Landmark Judgments: Important Provisions of the EPF & ESI Act interpreted by the Honorable Supreme Court of India