21 February 2024
FACTS: There are some house properties and vacant lands that are jointly owned by myself, my sister, and my mother. Rent is being credited directly to my mother's account based on the NOC given by my sister and myself. We don't want to claim anything from that rent. These properties were inherited equally by all three of us from my Late father based on Hindu Succession. TDS where applicable is also being deducted by the tenant only in my mother's name.
DOUBTS: Whether the income from rent need to be shown in the ITR of all co-owners or only in my mother's returns? Is this a case of diversion of income by overriding Title or merely an application of income?
23 February 2024
Above is as per Section 60 & 61. But please refer Section 62, regarding Transfer irrevocable for a specified period.
62. (1) The provisions of section 61 shall not apply to any income arising to any person by virtue of a transfer—
(i) by way of trust which is not revocable during the lifetime of the beneficiary, and, in the case of any other transfer, which is not revocable during the lifetime of the transferee; or
(ii) made before the 1st day of April, 1961, which is not revocable for a period exceeding six years:
Provided that the transferor derives no direct or indirect benefit from such income in either case.
So, if the NOC says that there is transfer of asset and it is irrevocable upto the lifetime of the beneficiary meeting other conditions as above...income may be included in the income of mother only
CAclubindia
