Gold jewellery transfer between HUF

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This discussion explores the tax implications of transferring gold jewellery from one Hindu Undivided Family (HUF), Ram HUF, to another, Ravi HUF, following the passing of Ram HUF's karta. Experts clarify that direct gifts between HUFs with different PANs are generally taxable. However, if Ram HUF is formally dissolved through a family settlement deed, the subsequent inheritance by Ravi HUF can be tax-free.

mohamed ali & co

mohamed ali & co (Querist)

01 March 2023 There are two HUF. Ram HUF and Ravi HUF. Ravi karta of Ravi HUF is also a member of Ram HUF. Ram karta of Ram HUF passes away. The gold jewelry of Ram HUF transferred to Ravi HUF.
Ram grandfather and Ravi his grandson.
Is it taxable under income tax. Can the experts throw light on such a transaction please....

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

01 March 2023 Ram HUF & Ravi HUF are different assesses having different PANs, hence any gift from one to another will be taxable.
If Ram HUF gets dissolved, and as such if Ravi HUF gets inheritance, it will be tax free.

mohamed ali & co

mohamed ali & co (Querist)

01 March 2023 Ram, karta of Ram HUF passed away. Can the other members of thid HUF give an affidavit stating that the HUF is dissolved and the gold jewellery goes to Ravi HUF, who is the grand son of Ram? Kindly clarify sir....

Dhirajlal Rambhia

Dhirajlal Rambhia

(Expert)

01 March 2023 Even when karta passes away, HUF subsists. Next eldest coparcener can continue to be karta of Ram HUF.
Once Ram HUF is dissolved by way of family settlement deed, Ravi HUF can get its share without any tax liability.

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