Gift in cash

In case wife gives ₹ 50000 as gift to husband who further deposits it as FD in bank. Now in whose hand is the interest on FD taxable?

Replies (6)
Quick Summary
When a wife gifts cash to her husband, who then invests it in an FD, the interest earned is generally taxable in the hands of the wife due to clubbing provisions under Section 64(1)(iv) of the Income Tax Act. This applies even if the asset's nature changes. Gifts received exceeding £50,000 in aggregate during a year may also be subject to tax under Section 56(2), though cash gifts up to £50,000 are typically exempt.

It is taxable under the hands of recipient
Under clubbing provisions nterest income will be taxable in the hands of wife

FD income will be taxable in the hands of wife.

 In all such instances where nature of asset is changed by the transferee spouse provisions of section 64(1)(iv) are attracted and clubbing of income takes place.

Yes it is taxable under the hands of wife

Clubbing provisions attracts, so same is taxable in hands of wife.

Section 56(2) of the Income Tax provides for taxation of gifts received during the year in case aggregate value of all the gifts, whether in cash or in kind during a year, exceed fifty thousand rupees. ...
If gift exceeds Rs. 50,000/- entire amount taxable, cash gift not exceeding 50,000/- is exempt from tax
As per contract Act gift without quid pro quo- without consideration, that means something for something need no be there, but love and affection even friend can give gift
If gift is immovable property, say house property then clubbing provision will apply, if it is let out then rental income taxable in the hands of donor, if it is occupied by donee notional rental income taxable in the hands of donor

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