Gift made to mother in law

sir, 

if your wife gifts cash to your mother then that cash gift is just a diversion of the amount and she can not claim it as a tax deduction for gifting money to her mother in law.Though the amount will be exempt in the hands of your mother in law.

If your wife has gifted cash to her mother in law , that amount will not be taxable in hands of her mother in law...

But your wife cannot claim any deduction for the same...

Thanks

Your wife cant claim deduction on same but in the hands of mother in law, it shall be fully exempt

Since mother-in-law is 'relative' as per explanation to Section 56(2)(vii),

gifted income would be exempt in the hands of your mother.

It is the income of your wife, and would be taxable in her hands.

Moreover any income derived by mother, from the money gifted by her daughter in law, will not attract the clubbing provision.