Gifting a motor vehicle

It's taxable under your friends hand under other source head under section 56(2)(x)...and how to show in return wait for other reply

Its taxable no blood relation.

Purchase the car in your name & gift it to your friend, its tax free gift.

Listen, brother ,Car is not covered In the Definition of movable property.
In income tax.
If you give a gift.
To your friend a car It will be exempt for him In Income Tax Act.There is not any case of relative and non relative.As it is not a movable property. When your friend sells the car then also capital gain is not applicable on it unless it is used in his business.
Your tax implication is you have to pay nothing and also you cannot take deduction of that 16,00,000.For better advice you can Consult a CA or a financial expert.

A car gifted in kind is not taxable for your friend. A cash gift would be.

• Sec 56(2)(x) taxes a non-relative recipient on gifts above Rs 50,000 of:

(a) money

(b) immovable property

(c) "property", which is defined (Explanation to 56(2)(vii)) as shares and securities, jewellery, archaeological collections, drawings, paintings, sculptures, works of art and bullion (and certain virtual digital assets).

A motor car is not in this list.

• So:

– You buy the car in your name and gift and transfer it to your friend: not taxable for your friend.

– You give him Rs 16 lakh to buy the car: taxable for him as income from other sources (money from a non-relative).

• For you (donor): a gift is not deductible. There is no "purchase" to show in your ITR unless your total income exceeds Rs 1 crore (Schedule AL threshold from AY 2025-26). Pay through banking channels.

• Transfer: RC transfer (Form 29/30) with a gift letter. The friend pays RTO charges. Insurance must be transferred within 14 days.

• Tax is about the asset type, so check the facts if it is a luxury vintage car that might count as a "work of art".