Gifts Income

As per clause(v) of Sec 56(1), where any sum exceeding Rs. 50,000 (w.e.f 01.04.2007)is received without consideration by an Individual / HUF from any person, such sum is trated as income i the hands of the recipient for the F.Y. This clause will not apply for any sum received from a relative, or on occasion of marraige of an individual or under will or inheritance...etc. for the purpose of this clause, relative means spouse, brother or sister, brother or sister of either parents, lineal ascendent or descendent of individual or the spouse of the individual.

Now coming to your query, gift received in kind from any one, of any value is not taxable. Only cash gifts received from other than relatives(explained above) is taxable if the aggregate value exceeds Rs. 50,000 in a financial year.

Any gift received from your grand father of any value, whether cash or kind, is not taxable in your hands as grans father is your realtive as per the definition of "Relative" in the aforementioned section.

Gift received from grand father, whether in cash or in kind is exempt.

It is not taxable