section 56(2)

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krishna gaggar (Querist)
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01 June 2010 whether lineal ascendants include one's maternal grand father/ grand mother.
If yes, then specify legal provisions contained in any statute.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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01 June 2010 YES.

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krishna gaggar

krishna gaggar (Querist)
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04 June 2010 Please also specify legal provisions contained in any statute

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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23 July 2025 Yes, **maternal grandparents (nana/nani)** are included in the definition of **lineal ascendants** for the purpose of **Section 56(2)** of the **Income Tax Act, 1961**.

Let’s break it down clearly:

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## ✅ What is Section 56(2)?

Section 56(2)(x) taxes **gifts** received **without consideration** (i.e., free) if the **aggregate value exceeds ₹50,000**, **unless** the gift is received from a **"relative"** as defined under the Act.

So, gifts from **relatives** are **exempt**, and hence, it's important to know who qualifies as a "relative".

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## ✅ Who is a "Relative"? \[Explanation to Section 56(2)(x)]

As per the **Explanation to Section 56(2)(x)**, for an individual, the term **"relative"** includes:

> **“(i) spouse of the individual;
> (ii) brother or sister of the individual;
> (iii) brother or sister of the spouse of the individual;
> (iv) brother or sister of either of the parents of the individual;
> (v) any lineal ascendant or descendant of the individual;
> (vi) any lineal ascendant or descendant of the spouse of the individual;
> (vii) spouse of the persons referred to in clauses (ii) to (vi).”**

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## ✅ Do Maternal Grandparents Qualify?

Yes.

* **"Lineal ascendant"** includes **both paternal and maternal ancestors**.
* Hence, **maternal grandfather (nana)** and **maternal grandmother (nani)** are included.

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## 🔍 Legal Support / Interpretation

Although the term **“lineal ascendant”** is not explicitly defined in the Income Tax Act, it has been interpreted in **legal usage and judicial decisions** to mean:

> **“A person related in a direct line of ascent (or descent).”**
> This includes:

* Parents
* Grandparents (both sides)
* Great-grandparents, and so on

📚 **Support from legal references**:

* **Halsbury’s Laws of England** (Vol. 13) defines "lineal ascendant" as someone from whom a person is descended by **blood in a direct line**.
* Indian courts have accepted that **maternal ancestors** are included in lineal ascendants. See:

* *CIT v. K.S. Ramaswamy* \[1985] 152 ITR 564 (Mad)
* *Shyam Sunder v. CIT* \[1975] 100 ITR 515 (P\&H)

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## ✅ Final Answer:

Yes, **maternal grandfather and grandmother are lineal ascendants**, and therefore qualify as **"relatives"** under **Section 56(2)(x)**.

➡️ **Gifts received from them are NOT taxable**, regardless of the amount.

Let me know if you’d like this in a formal note or letter format for your client or records.

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