Yes, Totally agree with you about the provision Mr. Rama Krishnan , but in which way are you connecting this provision to our case!?
Section 64(1)(vii) clearly states as under,
E. Clubbing of Income From Assets Transferred To A Person For The Benefit Of Spouse [SEC. 64(1) (VII)]
Income from assets transferred to a person for the benefit of spouse attract the provisions of section 64 (1) (vii) on clubbing of income. If:
- The taxpayer is an individual.
- He/she has transferred(directly/indirectly) an asset to a person or an association of persons. Asset is transferred for the benefit (immediate/deferred) of spouse.
- The transfer of asset is without adequate consideration.
In case of such individuals income from such an asset is taxable in the hands of the taxpayer who has transferred the asset.
Where did you find the benefit of spouse in our case? Yes, the transfer is without consideration but it isn't for the benefit of Spouse!