Mr. X jobs in a private company. He has one elder married sister. Mr. X purchases a house & after one year decided to gift this house to his sister. Kindly provide your views that he gifted after some consideration or without consideration. Also provide tax impact after five years his sister wants to sales this house.
In the given case, capital asset is house property
if
a)house property transfered for inadequate considertion,the following consequences will apply
if stamp value of given property exceeds sale consideration,then excess will be taxable in the hands of X,but not in hands of his married sister(but recent budget provides for taxation in both parties)i.e sec 50C will apply
b)for free consideration
no capital gain tax as,gift from relative is exempted from tax under INCOME FROM OTHER SOURCES
How ever at the time of transfer by x's sister,capital gain will be taxable in the hands of mr X
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