Huf - immovable property-gift or partition u/s 171 ?

There is no gift tax here because gift is given to a relative (son) as per IT Act. However, the karta and his wife, the owners of the property, will have to obtain NOC or release deed from other legal heirs and then prepare a gift deed in favor of one son. The gift deed will attract stamp duty and registration charges.

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a) Sounds logical but can not find a judgement.

b) HUF immovable property can not be gifted even with consent. See Mullah's Hindu law.

c) Both daughters, son and father have equal share (HSA Amendment 2005). In the partition agreement, girls and father can reinquish their shares.

d)  Change of records based on the partition agreement.

Let me know if you have any doubts. 

Sir have u got the answer of the above queries ?

if yes then please let me know the answers.

Dear All,

This is a very important query. we barely come across HUF and problems related to it.

So far as the Karta wants to gift the property to his son, its barred under Income Tax. Huf cannot gift any property to its coparcenor.

so wats the remedy
the HUF will have to make a total partition and It would be better to go equal partition among all heirs. Total partition would exempt from Income Tax. There after, separate gift deeds may be drafted to gift the share in house property to the son by all the coparcenors. Again, gift from relatives will be exempt in the hand of Son receiving the gift.

therefore no tax implication will hit in the above planning.

First, there would be deed of partision, Ao will be informed,

registration is secondary matter and can be done any time after the whole process

A HUF can gift movable or immovable property to its members. It will not be taxed under section 56(2)(v) of the Income Tax Act 1956, [vineetkumar Raghavjibhai Bhalodia v/s ITO], as HUF is a 'Relative' for gifts exemption under section 56(2)(v), (vi), (vii).

you are true in the sense that Huf can gift the property.and also that there will be no tax implication. But such gift are not recognised in the eye of law.. the Huf will remain the owner of property for tax purose and income from such property will be taxed in the hands of Huf. Further, such gifts May face serious legal litigations from other co parcenor

Since there is judgement in this regard which i have mentioned in my last reply so it can not be said that such gifts are not recognised in the eyes of law. As far as i know there is no such provision or judgement whuch confers that even after gifting the property HUF will remain owner of that property and the income from it will be taxed in the hand of HUF, if there is any then please let me know.

yes u r absolutely true that other coparcenor may have this point to litigate but since the manager of HUF is karta so others should not have any problem but safer side is to have noc from other coparcenors.

I have gone through the whole judgement in the case law. It was held by the ITAT that althogh 56 (2) vii does not include the HUF, but it contains relatives like father, mother, brother and so on. As these relatives forms the HUF in true sense, the definition of 56 (2) vii shall deem to include HUF. and accordingly gift from huf in the hand of Coparcenor be exempt.

In the judgement, ITAT itself agreed that 56 (2)vii does not include HUF.

The verdict did not considered some relevant terms of HUF and 56 (2) vii.
we need to understand, what constitute HUF. Huf contains Father, son and daughter. Mother is coparcenor in the huf of her father. further wife of sons are not co parcenor. husbands of daughter are not coparcenors.. However, definition of Relative under 56 (2) vii specifically enlist relatives, which is an exhaustive list of relatives. such relatives are even beyond the scope of coparcenory and Huf. Even after specifying such detailed list of relatives in 56 (2) vii, HuF was not included. It was an intentional move to exclude HuF from the definition of relative so as to comply with law of Joint Hindu Family, which states that HUF cannot gift its properties to any member or coparcenor. Accordingly I tax laws were framed to adopt the convention and specifies that Gift by Huf to coparcenor will not be recognised. The only way out of it is Partition.

If HUF are inter alia used for Relative.. Can you say that Relative can be used for Huf.. These two proposition are different..they cannot be used in place of one another. they are not at all synonyms. Relatives does not means Huf. Whereas the Tribunal in judgement considered Relative as HUF. To this extent, the judgement is not dependable. Further, this judgement is from I tat, Some higher authority could have been more dependable

If required I will forward you the sections governing taxation of HUF and HUF laws.

As far as Karta is considered, he is in fiduciary capacity and cannot favour any specific coparcenor. This is the fundamental principal of HUF laws.
Mere execution of NoC will not be sufficient to transfer of share in property to specific co parcenor.

Yes you are true in your points that the action is debatable and the safer point is partition.

Can you tell me the procedure to get the order u/s 171 regarding partition of HUF ?