Gift tax

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abhay

abhay (Querist)

16 January 2015 I want to know whether karta of HUf can give gift to HUF,it is allowable or not

CA. Anoop Bhatia

CA. Anoop Bhatia (Expert)

16 January 2015 The answer to your query has a reference to the provisions of section 64(2) as well as section 56 of the Income Tax Act 1961.

From point of view of section 64(2) any income from the gift made to HUF by Karta shall revert to the hands of Karta for taxation in short clubbing provisions to apply.

Whereas as per section 56 HUF can received money etc from its members and still such money etc shall not be taxable in the hands of HUF.

Thus it may be also understood that there is no double taxation.

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Rupesh Jain

Rupesh Jain (Expert)

17 January 2015 gift give by karta to HUF but clubbing provision for income earned from gift will applicable.
but gift will exemption hand of recipient.

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abhay

abhay (Querist)

21 January 2015 The provision of clubbing apply in case of transfer of capital assets.whether transfer of cash cover in the definition of assets under clubbing proviso.Transfer of cash and its investment are two different things therefor i want to know if cash gift given by karta to HUF allowable. Any income accrue on investment made out of such gift is clubbed in the hands of karta.

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