Income generated out of a gift

The answer for your question is in "Clubbing of Income"

Income generated will be taxed in the hands of the donor.

When donee has further invested such income into something else generating other income, that would be taxable in donee's hands.

Regards

Prateek

Thanks for the replies.

I was waiting for some more replies to comein. Anyway.

Now 

if an individual received gift worth 5,00,000 from all the 4 categories described above (1,50,000 INR from 1, 2 and 3 and 50,000 INR from 4) by cheques/drafts during 5th - 10th April 2011 and deposited the cheques/drafts in his savings account that had a credit balance of 25,000 INR, along with the salary cheque of 50,000 INR and invested the said money in the month of May 2011 in different instruments like FDs (3,00,000) INR @ 10%, Shares (1,00,000), Future trading  (50,000 INR) and left a portion in saving account and earns as follows:

27,000 INR as interest from FD less 2,700 INR as TDS on FD interest, 

9,000 INR as interest from savings account (whole year 2011-12)

25,000 INR as short term capital gains by selling shares till march 2012

5,000 INR as dividend 

(-) 15,000 INR as trading loss from future trading

Now the question arises if clubbing of income is applicable, then the above income and loss will be that of his donors including his own. 

1. How the income and loss will be distributed to the 4 donors.

2. And who acoounts for this TDS and how.

And if clubbing on income is applicable to donor for income from all gifts, then why examples of spouse, minor child(ren) and son's wife are taken exclusively (and not other relations) while describing clubbing of income, in the act, articles and descripttions. Nowhere it is mentioned for other relations.

Thanks