Purchase of fixed asset
Querist : Anonymous
Mr J is a retired government employee and is now receiving pension since last 2 years. He decides to buy a plot of land for Rs. 12.00 Lakhs in the name of his major son Mr S who is a professor in a college. Mr S has never filed his IT Return. I want to know the taxability of the said transaction in the hand of father and son.
Does it make any difference if Mr J buys the land and gift the same to his son?
Ur query is based on the provisions of clubbing.
Gift is exempted if gift is given to the relative.
so gift will not be taxable in hands of Father or son.
1. In my opinion father should give cash gift to the son and then son should purchase the asset in his own name. This channel of transaction will be tax free for both the parties involved in your case.
2.Now as u say if father buys land & then gift it to the son the provision of section 50C would apply & taxability will have to be checked.
So ur suggested to go for option 1.
Querist : Anonymous
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