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Subodh Kumar Goel (Querist)

22 January 2014 If husband transfers Rs. 1 Crore to his wife @ 5% interest and wife earns from the same @8%. Whether the difference of 3% (8%-5%) will be clubbed as income in hand of Husband.

CA Mohit Bansal

CA Mohit Bansal (Expert)

22 January 2014 section 64(iv) read as follows:
"subject to the provisions of clause (i) of section 27, to the spouse of such individual from assets transferred directly or indirectly to the spouse by such individual otherwise than for adequate consideration or in connection with an agreement to live apart"
Hence in your case difference 3% is taxable in your hand

Subodh Kumar Goel

Subodh Kumar Goel (Querist)

23 January 2014 How we will analyse that the amount has been given for adequate consideration

Subodh Kumar Goel

Subodh Kumar Goel (Querist)

23 January 2014 How we will analyse that the amount has been given for adequate consideration

CA Mohit Bansal

CA Mohit Bansal (Expert)

23 January 2014 In your case. Since you have transferred cash without any consideration from your wife, it is the case of inadequate consideration only

Subodh Kumar Goel

Subodh Kumar Goel (Querist)

24 January 2014 Sir we have given the cash in form of loan bearing interest 5%

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