Can my granpa gift me money by demand draft

Hello, You can received money from your grandfather & it will not taxable.  

Any amount received from specified relatives is totally tax free in the hands of recipient. So if a relative gives you gift in form of cash/cheque or in consideration, you will not have to pay any tax on the amount received.

Following is the list of relations which are considered as “relatives” for this

• Your spouse
• Your brother or sister
• Brother or sister of your spouse
• Brother or sister of either of your parents
• Any of your lineal ascendants or descendants
• Any lineal ascendant or descendant of your spouse
• Spouse of the persons referred  in above points

@ erdeep:

There is no tax implications on whether the gift is recd in cash/ cheque /dd or any other mode. Only thing the said gift should be recdfrom a relative as defined for the purpose of sec 56(2)(vii). Also make a gift deed at the earliest. That will be a sufficient proof for tax purpose and will be useful in event of family issues as well