Gifting bonus shares at 0 price to a friend

1. No tax liability on either of you when you gift shares to your father.
2. When father sell the shares depending upon the holding period by you both capital gain would be charged as STCG or LTCG.
3. If it is LTCG & all the conditions as per sec. 54F are satisfied,he can claim exemption under the section.

I hope there is no limit on the amount of gift fo this treatment.

No limit provided it is on record.

If this is to a friend what are the implications 

Tax liability over the gift receiver... if value more than 50K.

Is the tax liability an income from other source ?

can i not determine it as "bonus share at 0 price" making 0 income 
is it valued at fair market price as buy price and capital gains is computed on his sale price when my friend sells it 

Tax liability when gift received is income from other sources, based on its current FMV.

When sold by the gift receiver it will be capital gain...

For the donor there is no tax liability when gifted.. 

Yes, you can gift the shares to your father without consideration. A gift from a son to his father is exempt from tax in your father’s hands under the relative-gift exception in section 56(2)(x), regardless of the shares’ value. The gift is not treated as a sale by you, so there is generally no capital-gains tax for you at the time of gifting.

On a later sale, your father generally inherits your cost and holding period under sections 49(1) and 2(42A). For bonus shares, the cost is generally nil, so the taxable capital gain is broadly the sale proceeds less eligible transfer expenses—not automatically the current market price of ₹2,700. The holding period and whether the shares are listed, and their acquisition date, determine whether the gain is short-term or long-term and how it is taxed.

• Section 54F may be available if the gain is long-term and your father meets its conditions. Buying a qualifying residential house within the prescribed period can count, subject to the rules on other residential houses, ownership and investment of the net consideration. The fact that it is his only home is relevant but does not, by itself, establish eligibility.
• A recent purchase may qualify if it falls within the statutory window (generally up to one year before the share sale, or two years after). The dates, cost of the house, sale proceeds and any other house ownership need checking. Section 54F does not apply to a short-term gain.

A gift-and-sale sequence should be documented, and the bonus issue, allotment dates, share listing status, gift date and intended sale date will matter for the calculation and return reporting.

For this transaction, the key workflow is documenting the gift, tracing the bonus-share cost and holding period, and testing the section 54F conditions before the sale is reported. Manual practice work across these records and calculations is difficult; automation reduces repetitive work while professional judgment remains in control. At Jir AI, our 2,000+ AI agents and 650+ integrations streamline GST, ITR, TDS, TCS and other compliance workflows, helping reduce manual workload by up to 70%. For a smoother compliance workflow, connect with us on WhatsApp: https://wa.me/message/3HVOZ7HIY4ESC1