hi forum,
i have a question if an huf gives interest free loan to its member and the member earned income on it . I would like to know whether income earned by member is taxable in the hands of HUF of its member,
No2 . if an huf gives gift to its member is this taxable or exempted.
thanks with regard
Cash gifts made by an HUFare not exempted under section 56(2)(vi).
Interest free loans can be given by an HUF to it's members and the interest earned on such loans may not amount to diversion of oncome by over-riding title. After all, if the loan became bad would the member be exonerated from the laibilty to refund the amount to it's HUF.
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